CSI - Center for Strategic Initiatives
CSI - Center for Strategic Initiatives

5G as an element of upcoming revolution

Written by Adilgerey Namazbayev

July 1, 2019

The fourth industrial revolution, on the threshold of which the whole world stands, promises to be the beginning of a completely new era. It is based not only on inventions of mechanisms, machines, or machine tools, but also on new solutions in the field of communications, and they already go far beyond the generally accepted concept of “communications”.

The history of industrial revolutions dates back to the end of the 18th century. Then, in 1781, James Watt patented the first ten horsepower crank steam engine that used coal and water in its work. This invention, along with innovations in textiles and metallurgy, marked the beginning of the first industrial revolution in the UK. It also led to a sharp increase in labor productivity, economic growth (which had stagnated for millennia before) and transformed an agrarian society into an industrial one, initiating the process of urbanization and a massive transition from manual labor to machine labor.

The second industrial revolution, which took place at the turn of the 19th and 20th centuries, was due to the beginning of the use of electricity on an industrial scale, which in turn led to the opening of conveyor production, resulting in the further increase in labor productivity and rapid economic growth.

The third industrial revolution is characterized by the widespread use of information and communication technologies that caused automation of production and the emergence of a post-industrial society in the form in which we know it.

Now humanity is on the verge of the fourth industrial revolution. In terms of its scale and power of influence on the structure of society, it will not only not yield to previous industrial revolutions, but also affect all aspects of human life: the environment, technological order, the structure of the labor market and even the political systems of states. The fourth industrial revolution will lead to the customization of goods and services for the needs of each individual person, a sharp increase in the level, and duration of life.

All this will happen due to the further development of modern ICT technologies. The fourth industrial revolution will be based not so much on the industry itself but rather on technologies for obtaining and exchanging information: the use of big data, Internet of things, blockchain, virtual and augmented reality, 3D printing, as well as various other technologies that will be developed due to the transition to a new platform communication technology of the fifth generation 5G. In fact, 5G technology will be the foundation of the fourth industrial revolution, the same as the steam engine for the mechanization of production, electricity for conveyors, and computers for automation.

Communication technology of the fifth generation is characterized by a fundamental improvement in the quality of communication: a multiple increase in the data transfer rate, a radical decrease in the signal delay time, and a multiple increase in the traffic capacity per unit area.

Figure 1. The potential of 5G technology significantly surpasses the capabilities of 4G in 8 main criteria for evaluating telecommunications technologies

Source: ITU Telecommunication Development Sector
Key advantages of 5G
› Fiber-like speed (over 1 Gbps peak download and upload speed)
› Uniform network coverage (reliable operation at a speed of about 100 Mbps, even in dense buildings and at the edge of the cell)
› Low latency (around 1ms for interactive content, as well as reduced buffering requirements
› Low bit transfer cost

5G promises to be more than just a new standard for quality communications. This is a huge mass of opportunities for all industries, since it will allow the implementation of projects such as remote surgery using robots, autonomous transport, and industrial robotics with a minimum data transfer delay.

At the same time, the deployment of 5G technologies is a rather capital-intensive project. According to preliminary calculations made by the International Telecommunication Union, coverage of one square kilometer with a 5G network will cost approximately $2.3 million.

Figure 2. Potentially, 5G will create $ 12 trillion in global economic activity by 2035, which is 4.6% of total global real output in 2035

Source: IHS Economic Impact Analysis 2015

Deploying the technology, despite the high costs, will lead to tangible economic benefits. According to IHS Markit calculations, the effect of using 5G technologies on global GDP by 2035 will amount to about $12 trillion, which will affect almost all sectors of the economy and thanks to this technology, about 22 million new jobs will be created.
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