2020: An Unprecedented Year in Telecom
Podcast episode 38
Can’t wait to put 2020 behind you? The telecom industry feels your pain.
But as the novel coronavirus wreaked havoc worldwide, technology stepped up. For insight into what changed in 2020 - and what to expect in 2021, we turned to industry consultant Monica Paolini of Senza Fili, and to Nokia’s head trend spotter Leslie Shannon.
Below is a transcript of this conversation. Some parts have been edited for clarity.
Michael Hainsworth: This episode was recorded on March 276th, or so it felt. We can't wait to put 2020 behind us, but as the novel coronavirus reap havoc worldwide this past year, technology stepped up. Work from home meant telecom companies saw their five-year plans for bandwidth growth eclipsed in a matter of months. Companies which previously shunned a hybrid work life adopted video conferencing and other technologies.
But what surprised us the most, was the adoption of largely abandoned technologies like QR codes, and nascent ones like augmented reality. For insight into what changed in 2020, and what to expect in 2021, I turned to Monica Paolini, the founder and principal at Senza Fili, a consulting firm that provides market research, financial analysis and advisory support on wireless data technologies, and to Nokia's head Trendspotter, Leslie Shannon. Shannon believes 2020 was the year augmented reality really took off.
Leslie Shannon: Some of the implementations of augmented reality that had been done before COVID, and I'm thinking here particularly, on some work of the company Atheer. They were working with Porsche, and in 2018, they put together the kind of virtual “expert looking over your shoulder and helping the person on the plant floor, with the expert knowledge from afar,” which we see as extremely common in enterprise.
They built that in 2018, and it saved a huge amount of time and they made 40 percent savings on the amount of time it took to fix a car, but in reality, people weren't actually using it that much, because it's a big ask to ask somebody to change the way that they do things. To put this thing on their head, and also importantly, putting it on their head and calling an expert, meant that they didn't know themselves. And so there's this innate pride that had to be gotten over as well.
But then they found with COVID-19, this thing that they had built that was not getting full take-up, COVID was now the thing that shifted people to, “Oh, now I am completely on my own, and the only way I'm actually going to be able to do this, is by putting this thing on my head and calling the expert who is not here,” and so usage actually grew by 300 percent. And this is indicative of ... we saw this happening all over the place with these remote training, remote access, remote experts, companies that... where they used to send in large numbers of teams to do things like, take new water plants, put new water plants online.
Well, with social distancing, they couldn't have that same number of people physically working together. So, companies started using this similar kind of augmented reality technology to have the minimum possible people actually on hand at the site, but then connected to the rest of the team who was able to be offsite and in a safe place. But then see what was going on and then to tell them so, functionally having a much larger team. In that enterprise space, augmented reality really saw a spectacular moment this year because of the absence of -
Monica Paolini: If I may add, that I think it's really important is the need for it, and the data clearly is available. That helps, but it is the need and the fact that, not only the employees, but also management, were okay to allow people to use it. Everybody felt safe to use it. Safe in the sense that, because of the environment, it was the right thing to do, and so people could leave older worries behind. Because let's say you are doing some tasks, and it doesn't work all that well on the first day, it doesn't matter because there's nothing to lose. There's no alternative. That gives people the ability, and the freedom to really try new things. I think that you mentioned QR codes, but the one that I would just... it makes me think about is video.
I mean, I remember when we started looking at video and like, what would you do with video? Why would anybody upload a video of themselves speaking? People are uncomfortable doing that. Now we just do it all the time without even thinking, without even getting ready for it. This is something that ... COVID is really, as terrible as it is, it's been a really huge learning ground.
One other thing that I have to say, however, is the fact that you were sort of starting to see a better headset... I mean, better devices that I think are going to be huge because, going around with this thing, this huge thing on the head, just makes the technology not look so cool. Now that you have new devices that are less obtrusive, I think that's going to make a huge difference as well.
Necessity is the mother of invention.
Michael: It sounds like COVID gave us the opportunity to fail by experimenting with these new technologies.
Leslie: That's a terrific point that you made. I think you're exactly right. And we see it over in the VR world as well. There's a lot of companies that have sprung up actually in this COVID moment, particularly in Europe. Companies like Arthur, or Realm, or Immersed, or MeetinVR, which are virtual reality meeting spaces, where people can come together from all kinds of different areas of the world, and then have "physical presence" together to work on things, and to have meetings and brainstorm sessions. Especially when writing things up on whiteboards, or on sticky notes, having some kind of a virtual physical group presence makes a difference, a concrete difference in the way that the meeting flows.
But I was talking to the people who run Arthur actually, and saying, well, not that many people have virtual reality headsets at home. So, surely you're limited by that hardware footprint.
They said, well, actually out of necessity, we have had to get into the VR headset management thing. Because, one of their customers is a large well-known consultancy, and they do workshops for their customers, and what they do is they mail out a physical VR headset to the customers who are going to take part in this workshop ahead of time. These people quite often have never worked in VR before, they'd never even touched a headset, and they're getting them in the mail and they're putting them on, and then they're joining these meetings.
Honestly this would not be happening, if it weren't for COVID. But what these VR meeting space people told me also, is that a significant proportion of people after they get this VR headset sent to them at home, and then of course they have to mail it back right after the meeting is over. They say... “Can I keep this? Because now that I've experienced this, this is really cool.” That necessity is the mother of invention. Necessity is the mother of trying new stuff and discovering, there is something in this. I think we're actually seeing an acceleration of VR as well as with augmented reality.
Michael: But what do We know will stick in what won't stick? The global AR, VR market, by 2030 is projected by some accounts, to be a $1.3 trillion industry. But the vast majority of that, 90 percent of that is expected to be AR not VR. How do we know what will and will not stick that we've been experimenting with through 2020?
Monica: The distinction between AR and VR, might actually disappear. In the sense that what's the difference? I would imagine that it's going to become much more of, how can I say, a whole change in the way we really relate to basically video content. Video content, initially was, you just download it. And then we learned that we can upload it too, and now it becomes really much more interactive. The video is tied to action, and to learning, and to do things, and now you want to call it AR, VR or whatever, and you need a headset or not. I think that this is just going to eventually disappear and become just a different way we interact with each other, our ‘why’, and there's going to be a lot of variations on it.
Leslie: HTC actually, the China President of HTC, Alvin Graylin speaks specifically about HTC's vision, of the headset being something that does have a spectrum, a sliding scale. Sometimes your vision will be fully occluded and you will have a completely artificial world that you see, and that's the kind of virtual reality. But then that same headset would then shift to allowing video pass-through, so that you do see the world, and then you would see the mixed reality elements integrated with that world. And so really looking at creating headsets that are a spectrum, between augmented reality and virtual reality, and you move between them depending on the use case and whatever you're trying to accomplish at any given moment.
Monica: I did once a demo where it was not just a headset, but it was a chair that would move and it simulates movement, and it was so realistic. I have fear of heights, and I was about to jump off the chair. So it might have other things, not just the headset, it's just a full body experience. Clearly, that's not most of the time, but you might have that as well.
Michael: Then what are the big lessons that enterprise learned as a result of accelerating the use of tech, that really wasn't expected to become a thing, for a few more years. Leslie: The companies that I see that are really leaning into this. They're discovering what we all know is true anyway, in that, technology is not an end in itself. It is an enabler, and it is an enabler to help you reach your business goals.
This COVID moment has helped people see beyond the new-shiny-toy aspect of virtual reality and augmented reality, and help people understand, these are actually just tools for helping me accomplish something and get something done. Now that I don't have another path to get this done, I can't go and do this physically, Monica, as you pointed out, now I realize, there is actually serious utility in these. They are tools, and I can stop worrying about the newness factor, and actually, just use them to now accomplish my business goals. I think that's the significant shift that's happened this year.
Monica: This is really important. Another aspect which is not really technology driven, but allows technology to penetrate, is the fact that companies are learning to trust their employees working from home, which before was also a limitation, or the patients in healthcare. The doctors are trusting that an online interaction works. So not only do you have to do it and it works, but you develop a sense of trust. That is really important to get those technologies to be seen as something that you can rely on. People can work from home and be efficient and maybe even more efficient. That is going to change, because then even if you go back to the office, you're not necessarily in the same place. That, I think, is going to be really important for the long term adoption.
Michael: Telecom companies had their five-year bandwidth demand plans met within months of COVID hitting. How did they handle that accelerated adoption?
Leslie: Well, I think when we look at the connectivity shock that happened back in March of this year, March and April. It became very clear that everyone in the world is fine with business people suffering through bad connectivity. But as soon as you talk about school children, suddenly action will be taken.
One of the big things that we saw is shining a spotlight on places in the world where there were connectivity gaps. Many countries around the world at the government level, and also at the individual company level, really got going with incentives to actually make sure that everybody, all the school children in this country, including in rural areas have a decent connection.
Italy did a lot of work on this, New Zealand did a lot of work on this, the United States has been mobilized with this. So, not only do companies have to look at redoing their five-year plan as you point out Michael, but also, the bigger shock was, we left some gaps, and we have to go back and we have to do some remedial back filling. Which I think is very necessary work, and I'm actually pretty glad it's happened. But that's actually where I've seen a lot of our customers focusing.
It's not a service that you get to get your kids to play games or whatever. It's really important.
Monica: One thing that actually surprised me was that the networks are actually relatively doing pretty well. Yes, there was a surge, but the ability that operators have to actually manage traffic really helped a lot in making sure that the right priorities were met. That actually, was good.
The telecom industry, we did a very important role in keeping things going. I think that we should pat ourselves on the back in that respect. But, at the same time, that really caught the attention of how important it is to provide connectivity to everybody. It's not a service that you get to get your kids to play games or whatever. It's really important. The whole discussion about digital divide, or making sure everybody has the right connectivity really grew a lot.The tone changed. It's like, this is really important.
Also, because of that, because of the ability to work from home, a lot of people are starting to think, well, do I really need to live in a city? There is a trend of people thinking of moving outside the city, and that is going to be very good for rural communities that we'll see even a further increase in requirements, I think moving forward. And that again, will make it much more of a priority to make sure everybody is connected. I think that in terms of long-term, this is going to be quite important.
Leslie: You mentioned that, our entire industry really deserves a pat on the back, and I completely agree with you there. But we also have to thank Netflix and YouTube, because they voluntarily reduced the default Kodak that they were using for their broadcasts from HD down to SD. That is what actually, if they hadn't done that the networks would not have survived.
There was... this general coming together across industries, there was a lot of altruism that we've seen. That goes to that theme of trust, Michael, that you were just talking about. Microsoft, they ... if you were building an augmented reality application that had some COVID use, they actually gave you the use of augmented reality for six months for free. There were a lot of companies that were doing things to really open up, and show that we're all in this together. Let's solve this problem together.
But at the same time, we also see opportunities in connecting everybody. Where companies can actually pivot just a bit, and then find new business opportunities. AT&T did a partnership with Airstream trailers, so the idea of getting a trailer, and going out to the woods somewhere, but still having good connection, so you can actually work from your trailer. That is a really interesting partnership that I enjoyed this year.
Also seeing Verizon, they rejigged their 4G, which was more prevalent in rural areas, to actually have that become a broadband offering for people who really don't have any other opportunity. But to be able to have 4G providing at least a certain amount of broadband coverage, in the areas where nothing else is available. Lots of creative rethinking about this whole theme of getting people connected away from where they used to spend their time.
Michael: And some fun creativity too. You were talking about the educational component to this, educating children under COVID-19 required some remarkable resourcefulness, not just on the part of the parents, but certainly the teachers as well. Even an elementary school graduation took on a decidedly high-tech tone, in a way that definitely appealed to the children.
[Animal Crossing music interlude]
Leslie: The tech futurist Cathy Hackl, she told me that her child's kindergarten graduation was shifted over to Minecraft. And actually, one of my friends came across a wedding that was happening in Australia, in Animal Crossing.
For me, this is one of the most exciting things about this year. Yes, there's the platforms that are created for online action. They're really designed for that. Zoom, and all these really took off. But it's, for me, the platforms that were not designed for this specific kind of thing, but people moved into them anyway, particularly, in a lot of gaming platforms. Concerts happening in Fortnite, I mean, that was happening already. But people meeting and having business meetings in Red Dead redemption, and all this stuff actually, goes to show for me, that one of the biggest messages out of this whole COVID year has been that we as human beings, are ready to accept a digital presence as having equal validity with our physical presence.
And so, okay, we can't have a physical graduation, we will have it in Minecraft and it will still count. This actually opens up the whole door, to us moving many things that happened in the physical world, into the digital world going forward. This is the nose of the camel coming into the tent, and it's really just the beginning of our digital selves taking on just a significance that we really hadn't realized before.
Michael: Where do you see that happening? When you say that, I think about industries like the real estate industry, which are still using fax machines, like it's 1993 or something. What industries are ripe for that kind of disruption that COVID-19 told us was now possible? When the bean counters and the corner office said no, we can't do that.
Leslie: Technology takes off when it solves a problem. So COVID has thrown problems at everybody at all industries, and the ones that can actually get over the ah! fear of the new, and then use these new approaches to solve problems are really going to be the ones that can leapfrog.
I mean, you mentioned real estate, there's companies now that are using 360 degree cameras, connected over 5G, ideally. And somebody can walk up a 360 view camera through a commercial real estate area to do real estate inspections, for somebody wearing a virtual reality headset on the other end of it, to be able to tour the space and to inspect it. The advantage of that, over say, somebody just walking around with an iPhone on FaceTime, is that the person who's wearing the VR, they can see everything. They're not limited by the things that the other person is pointing the camera towards, right? Maybe they're not showing the rat nest over that corner. But, if it's a 360 degree camera that's being carried by somebody, the person with the VR headset really has the freedom to explore everything in the environment with no holds barred. That to me, seems like a real opening up of possibilities for commercial real estate inspection, where you can't physically be present.
Monica: It's very difficult to see which vertical is going to be more effective. I think all of them equally, because everybody's facing the same similar situation, which is highly unusual because usually you just have different time frames.
One thing that I would like to say though, I think that healthcare and education are particularly important because there has been a lot of resistance and there is one category of people that might benefit a lot in the long term, and it's people with disabilities. I was talking to somebody about kids that might not be able to go to school because of a disability, or they might have limited mobility or whatever. This kind of development actually, is going to help them in the long term, because a lot of tools that are very helpful for them, way more than even to the other kids, are available to use.
I think the question is, we have all this kind of activity now, but what is going to stick in the long term? If you think about, for instance, education, now that we got it out of the bag, it's like, why would a class not be also available online even afterwards? Why not? What's the reason not to do that? And that opens a whole possibility, for instance, for disabled kids, or for students that cannot live in the place where the city is, where the school is.
There was a discussion about, how is that going to change for instance, colleges? Because colleges might offer that their degree is also offline, or part of it is offline. How is it going to change? The distribution of them. I think they're really going to see a lot of long term changes, even though some people think that, as soon as this thing is over, we'll all go back to work in the office, and go to school. I don't think so.
Leslie: I agree with that. I think healthcare is extremely vital here, but we have to look at regulations as well, and regulations are going to have to catch up with this new world. For example, here in the United States, teleconferences with your doctor have just completely taken off, and surveys are showing that people are saying, I'm going to keep doing that after this is over.
But in some countries, teleconferences with your doctor's not even actually possible, because of local rules and regulations. Another example, there's a company in Denmark that's been doing VR recreations of medical labs to be able to do training, to be able to do lab work. That's actually really taken off again in this COVID time.
But, the thing is that many places in the world, if you have received your training in virtual reality, as opposed to in a lab, that actually doesn't count towards you getting licensed as a lab technician. So licensing bodies need to actually incorporate these more virtual ways of education and training, and to accept them as something that is, yes, we can actually license you if you only received your training in virtual reality. That's the kind of advances that we're going to need to see, to really be able to get the full promise of the changes that we're seeing now.
Monica: You proved that you can do it, the technology can do it. You proved that people can actually do it and be happy with it, companies are fine as well. The question is that in the longer term, because regulation is going to happen after COVID, probably, the question is, will we keep the momentum? And I hope we do, but to me, that'll be the biggest question mark.
Michael: Well, then let's talk about 2021. Because COVID, lockdowns, restrictions, they will still be with us regardless of the rollout of vaccines that we're seeing now. What role will 5G play, as these rollouts continue? Because it strikes me that 5G is infinitely more flexible than previous generations to accommodate for big spikes in demand, in areas where they weren't originally planned in the first place.
Leslie: My one regret about this whole COVID thing, if it had to happen, if it could only have happened about two years later when we had a lot more 5G already in place. Because it's undeniable that the physical rollout of it has actually been delayed, at least partially by the restrictions of COVID unfortunately.
But, that said, it is progressing and especially with getting more 5G consumer-enabled devices like the iPhone, take up is just going to keep increasing, and that's actually really terrific. But I think some of the biggest promises of 5G actually come up in a lot of mobility scenarios. I think we're really going to see people's lives being changed with things that are enabled by 5G, really coming on in the second half of 2021, where we have people moving outside of their house again.
But that said, there's some really interesting things happening with just basic connectivity, both BT and Vodafone in the UK. They're offering second fixed lines to people's homes. Just this recognition that, okay, you have filled up your line.
Michael: Wait a minute back up. I thought we were killing the landline, and we were going all wireless. We're having second phone lines into our houses?
Leslie: Yes! Because Michael, it is never this or something else. It's never broadband, or 5G, or WiFi. It's always and. It's broadband, and WiFi, and 5G and WiFi-6, because the things that we use, we use all of it all the time and we are going to need it all.
So why not have a second fix line to the house? Right now this very second, I'm on the call with you, my husband's on a video call, my two kids are upstairs with their school all on video. We have completely used up our fixed broadband allotment every month since COVID started. I could certainly use this second fixed line! And then give me 5G, so I can actually do great stuff when I'm away from the house as well.
Monica: Actually, I think it's a really important point because a lot of the use cases that we thought with 5G that initially people throw out, but people are now going to use, like, virtual reality. So in a way, this is sort of very good prep ground for the 5G applications that are coming up.
The other thing though is, if you think about the second line to the home, the way I think about it is like, whatever device you have right now, it doesn't matter what is eventually going to happen. WiFi, 5G, 4G, whatever, it's wireless. But then it has to go somewhere, and most of the traffic goes through the wire line eventually. The distinction between the two ceases to exist. The devices are wireless, but not everything is wireless, so 5G, no matter how great it is, still, if you have all the traffic going through 5g, it would be ridiculously expensive, impossible, and never happen. You need to have the wire line as well. And it's the combination of the two that makes the whole thing powerful. So just having wireline wouldn't be enough, and just having 5g will not be enough. Tt's all of them. But what has changed in the last 10 years, is that all the access is wireless. That is a huge thing. I think in terms of the development, and maybe 5G is going to be a little bit delayed, but I don't think that in the long-term, it's just going to be a blip, in that respect.
Leslie: Yeah. Agreed.
Michael: Then let's look ahead to what you're most looking forward to out of 2021? Aside from actually being able you leave the house?
Monica: What I'm curious to see is the longer term, we're not going to be in a lockdown anymore. How is that going to change really? And what is going to stay around? I think it's going to be a lot, but not everything will stay around in the same way. I'm really curious to see how that is going to progress? And we want to be able to use what we learned from COVID, moving forward. It's really important that we learn from it.
Leslie: What I mentioned before about how 2020 is the year in which we found our digital selves, and found that our digital selves had validity, and the things that our digital people do, our digital selves do actually counts, right? And so, because I actually am very careful with my language. I don't talk about the real world versus the digital world. No, because the stuff that happens in the digital world is actually real as well as, so it's the physical world versus the digital world and both are real.
For me, one of the most exciting things that happened in 2020 was the Kentucky Derby, this American horse race that happens every May, and they had to postpone it this year. But NBC, the TV station, had already paid a lot of rights and they had the broadcasting time. So, what do we do with it? They did a digital recreation. The Kentucky Derby is the first race in the triple crown of horse racing. There's 13 horses in history that have won the triple crown. So they did a digital recreation of the Kentucky Derby, using the exact races that were run by the 13 horses that have won the triple crown in the history of the horse race. For the first time ever, we see Sir Barton who won in 1919, the first one, racing against Secretariat, who won in 1973, racing against American Pharaoh, who ran one in 2015.
This was just completely mind blowing. You didn't have to be interested in horse racing at all to go like, “Oh my God, what a concept!” Because the thing about moving things into the digital world and having it be mainstream is you can do things in the digital world that you cannot do in the physical world.
And this fantasy Kentucky Derby, and having that be broadcast to millions of households in the United States and people go, “Whoa, that is amazing.” This is where I think we're going to start exploring, and start seeing, What are the things that we can do in the digital world that we couldn't do in the physical world? That actually makes our life better, more interesting, more vibrant, more vivid, easier, more efficient... name the adjective, and stick more in front of it. I'm really excited to see what we come up with next in that category.