The exponential spread of the Coronavirus pandemic has disrupted the world in unprecedented ways. As the outbreak continues to wreak mayhem on our daily routines, our health security, markets, and industries in the United States and across the globe are facing their worst crisis since the 1929 stock market crash. After a widening shutdown, the U.S. stock market plummeted with the DOW’s largest 1-day drop of nearly 13 percent.
As a result, businesses are encountering unique challenges, all of which require thoughtful and comprehensive planning in the new bear market.
The consumer tech industry is no exception when it comes to responding to the pandemic. Big tech behemoths like Apple are already affected by the coronavirus outbreak, experiencing shortages as its primary manufacturer in China, Foxconn, halted production of necessary supplies. In February, the company sold fewer than 500,000 smartphones in China during the outbreak.
It may still be too early to assess the full financial impact of the virus on the consumer tech industry, but the signs don’t look good in the short term as stocks for major tech companies (who make up the large portion of the market) continue to tumble. But that doesn’t mean that all is lost for consumer tech products. Despite the coronavirus’s historic setback of the economy, I believe we can expect to see some promising movements into where the market is headed over the next year.
Accelerating the Need for 5G Technologies
In the United States, our infrastructure is largely 4G-enabled. The move to 5G has been stalled because of the high cost to install entirely new infrastructure and that we don’t have a new, integrated system offered at reasonable prices. According to market research firm NPD Group, 5G was available on only 1 percent of phones sold in 2019.
During the coronavirus pandemic, however, remote communications have become a growing necessity for those who work and attend school from home. Verizon reported the increases in bandwidth use increased by 75 percent on March 18th. As the foundations for this type of work become more normalized, it continues to highlight the need for an efficient 5G framework. These technologies, which feature lightning-fast speeds and almost instant connection, are primed for remote communication and can potentially accelerate adoption. Telehealth and telemeetings are two main software applications that are proving critical for companies during the pandemic. The increased reliance on these key areas may enhance the appeal of 5G. In China, 5G was used and continues to be used to support health tech and apps that monitor a user’s temperature. A program using this technology was recently deployed at a coronavirus hospital in Wuhan that was staffed by 5G-powered robots who protected medical professionals from the virus.
As a result, the most obvious path to install 5G would be to retrofit existing 4G systems, locking the existing wireless companies into existing hardware providers like Nokia or Ericsson. While these consumer tech companies are not as sophisticated as the highly efficient Chinese provider Huawei, the market demand for 5G systems and tech that supports it will continue to grow.
Increased Need for Virtual Technology
In many sectors, the inclusion of powerful online tools is often slowed by legacy institutions, who often work in collaboration with overcautious officials. A good example of this is Medicare allowing billing for telemedicine. It was a long-overdue and now allows healthcare professionals to revisit HIPPA and use similar tools to how we communicate every day like Sykpe, Facetime and email.
Even when Facebook purchased Oculus for $2 billion in 2012, VR was thought of as the next big thing but still had trouble entering mainstream culture. Internal data at Facebook showed most people didn’t want to use a VR headset more than once a week. Ultimately, consumer-facing VR startups shuttered. However, the coronavirus outbreak could emphasize the need for virtual reality in big businesses, entertainment and healthcare, boosting its presence in sectors across the board. When there are canceled conferences or business trips, for instance, VR technologies can allow attendees to avoid missing business opportunities and interact with potential partners and other professionals who are vital to fostering their ROI.
Elizabeth Bradley, the president of Vassar College and a scholar on global health, believes that VR will allow us to have experiences we want and need even when we’re isolated or quarantined. Bradley says, “Maybe that will be how we adapt and stay safe in the next outbreak. I would like to see a VR program that helped with the socialization and mental health of people who had to self-isolate.”
Future Investments in Smart City Solutions
The world won’t be the same in the aftermath of the coronavirus. Cities are utilizing their smart city technologies to help mitigate the impact of the virus. In China, police used drones with thermal sensors to identify people in public with a high fever. South Korea developed a smartphone app that connects self-quarantined people with caseworkers so they can report their status and ask questions about their condition. Similarly, Australia launched a chatbot to answer questions about the pandemic and dispel misinformation.
Each of these crisis management technologies falls into line with smart city infrastructure, which proves to be crucial investments during a worldwide crisis, so major cities can prepare and prevent more pandemics like this in the future.
While the majority of smart city solutions only support daily operations of a city, foundational infrastructure, — city-wide IoT connectivity, surveillance, or citizens communication platforms — can be flexible to meet the needs of a government in trying times, as the coronavirus has shown. Some estimates show that some smart city investments will reach $131 billion this year and soar to $463.9 billion by 2027. As smart city consumer technologies prove to mitigate the pandemic, governments and business leaders may feel more confident in further investing in smart city technologies, accelerating the rate at which we install these solutions.
It’s hard to feel hopeful about the future during the midst of a pandemic, but investments in these technologies are now and will continue to prove helpful in the long term. VR can help us socialize and operate our daily tasks, as smart city technology helps protect us and 5G technology accelerate our ability to access information and the connection we need. Data from Kensho shows that although tech stocks are historically the biggest losers when the S&P 500 drops more than 10 percent over a 6-month period, consumer tech still tends to fare the best of any S&P sector, especially as stocks head into a bear market. Perhaps, there’s no better time to invest in the future of tech to help the future of humanity thrive.
Written by Paige Soya. Have you read?
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