5G, Retail, Fashion, And Emerging Markets With Stepan Chernovetskyi
Stepan Chernovetskyi, founder of Chernovetskyi Investment Group, shared with Forbes his views on 5G perspectives in the developing countries, on the massive impact of the new system of communications on business and retail, and on CIG’s investment in modern technology.
High-res wireless surveillance. VR physical therapy. Driverless cars that don’t just drive, but interact with and talk to each other on the road. These are all some of the technological implications of 5G.
While North America and the United States will be the biggest adaptor to 5G technology in the coming years, regions such as Asia-Pacific are hitting the ground running. Countries like China, Korea, and Japan are already leading the charge in the 5G race, with Western Europe in 4th place. What will all this mean for emerging markets, where the digital divide with the rest of the world is already pronounced?
According to Stepan Chernovetskyi, head of Ukrainian-based investment firm, Chernovetskyi Investment Group, “Emerging markets have the potential to be more receptive to 5G.” His firm is one of the more prominent investment groups in Eastern Europe and puts money into infrastructure projects, high-tech agriculture, and engineering across Eastern Europe and India.
“For the first time, there are more people that have access to the internet than ever before,” he says. “Which is why I think the second half of the connectivity growth could be concentrated in developing countries.”
He’s right. According to the ITU, a UN agency that focuses on information and communication technology trends around the world, the Asia-Pacific and Africa regions drove the growth in mobile cellular subscriptions in the last five years, with negligible growth in the Americas and a decline in Europe and the Arab region. Currently, 90% of the global population can access the Internet through a 3G or higher quality network, which is leaps ahead of even 10 years ago.
“Just four years ago Ukrainians and other developing countries were lagging in the era of 2G, or in the best case, EDGE mobile data speeds. Unable not only to watch and stream online video on the go but even to browse web pages at a reasonable speed,” says Chernovetskyi. “Now, after the leap to 4G, you can use PayPass payment to buy goods from a babushka at local farmer’s market, and Ukrainians are massively refusing to use paper money and even old plastic cards.”
There are those who argue that 5G won’t bring that much change, and if it does, it will only be with significant investment. The difference between 3G and 4G, after all, was minimal. But the onus is not on the wireless provider to create the change that comes with the technology. Their job is simply to bring it to the public. It’s up to innovators to come up with the apps and advances that take advantage of the new network.
For example, the first 4G phones were released in the US around 2010 and it wasn’t until a few years later apps emerged that took to the new network and ran with it, and ultimately changing our worlds as a result. Take, for instance, Snapchat which came in 2012 and uber in 2013. It was also around this same time that video calls became the norm.
The initial uses of 5G in fashion, so far, has skewed more in the realm of exploration rather than innovation.
In collaboration with UK wireless company Three and utilizing augmented reality behemoth Magic Leap’s technology, the Central Saint Martins (CSM) MA Fashion program staged a visually explosive graduate show earlier this year using 5G. CSM’s MA Fashion program is one of the top fashion programs in the world and is a recognized incubator of talent (it graduated a plethora of greats like Jean-Paul Gaultier, Stella McCartney, and John Galliano), so the combination of emerging fashion alongside emerging technology created a highly buzz-worthy moment, even if it was nothing more than just that—buzz.
Although the potential for fashion and retail in emerging markets will be different than that of the developed world. In the West and in Asia, it means sensational events like the one at CSM and fully AR and VR experiences at the retail level. In the developing world, however, where much of the world's fashion is produced, the implications of 5G are more supply-chain based.
“For emerging economies, the connectivity afforded by 5G in the countries where fashion is produced will have massive implications in the supply-chain,” says Chernovetskyi.
“We’ll see video conferencing via 5G devices as part of the design and development process. We’ll see the full digitization of the supply chain from start to finish including the monitoring of production and visual tracking of samples. Product lifecycle management systems are also going to be incredibly intelligent and efficient because of the high upload speeds and download of data,” he says.
“Virtual assistants that utilize AI and machine learning will take over the little tasks that are often time-consuming and cause inefficiency, while the hundreds of real-time connections and easy use multiple devices will have incredible potential for warehouses and factories. And as technologies become more advanced as do the devices on which they operate, the pressure put on available bandwidths to employ these technologies will be less, making it easier to utilize internet of things devices across the entire supply chain.”
While all of the potential supply-chain benefits are evident, service providers in developed nations have to upgrade to the new networks, first. Then consumers have to upgrade to the new devices which would be cost prohibitive to the average person. While these seem like the obvious barriers, the demand on faster networks and better technology from mobile hungry consumers in these economies is significant.
Consider India, where data consumption per capita is a world leader in the amount of MBs consumed per month and where the decline in pricing of mobile services has led to greater adoption as a whole. Plus, Indians now demand the sort of connectivity that supports their heavy consumption of video, entertainment and other services—all delivered on the latest 4G LTE Advanced networks. It’s not just India. It’s hardly a secret that China is gobbling up global market share on the 5G upgrade race.
All things considered, a fully global, 5G-fueled fashion supply chain may not be as far off, or as far-fetched, as we think.