5G + EmFi = Digital Economy
Dr. Caesar J's Digital Management periodicals?
The eighth in the series of summary outlines
April 2023?
5G + EmFi = Digital Economy
The Digital Economy infrastructure is 5G. Digital is mobile. Mobile today is smartphone. Smartphone is Applications. Applications is Embedded Finance. All applications have a direct or indirect financial component. The digital enterprises run on mobile applications; hence, digital enterprises are EmFi’s. Mobile today and tomorrow is 5G. 5G is many things, mostly high throughput capacity and low-latency, or high speed. Embedded Finance (EmFi) is the tenant of Apps and Apps live on 5G. How can connectivity speed produce digital business opportunities? Do you remember MV=PT from your macro-economic course, the Irving Fisher equation? This equation when rendered in digital becomes: M is number of smartphones (Mobiles), V is 5G (Velocity), P is CBDC, and T is EmFi.[1]
1.?????Macro-Economics
If today telecoms is considered merely as an infrastructure commodity, 5G is its enabler at national level. The new wealth of nations is data, data is digital, digital is mobile. 5G will carry and store all national data, therefore the AI, from the source to the store. Traditional Macro-economics is the C + I + G = National Income. Mobile subscribers of 5G + EmFi’s + GovTech will be the digital economy, the national digital wealth.
The value of data has been increasing through the digital transformation life cycle. Witness our obsession with ChatGPT, no data no AI. The 5G technology will increase the?national data?volume, especially when multiplied by speed, and will have a role in the storage, the tracking, the tracing, the security, and the ownership. Embedded Finance is the electrons around the 5G nucleus. The EmFi’s are the boxes holding and incentivizing the data generating. Data is monetizable and liquid.
Applications have a lot in common, they all run on either iOS or Android, similar life cycle patterns, maintenance, and upgrades. These are the EmFi’s, the organ cells around the 5G skeleton. The 5G EmFi data is processed and stored through 5G on local or international?clouds,?where national data sovereignty is shared.
The MNO (Mobile Network Operators) are the blood vessels between the 5G skeleton technology and the #EmFi organs. All data flows from the smartphone to the mobile operators using #5G and store its data. Each of the MNOs has the potential to be a local Google (Alphabet), Facebook (Meta) or ChatGPTn.
The 5G technology has the strength of the?edge?computing, supercomputing, and services where digital services and data remain at the extremities of the network. 5G is a self-generating data factory, it induces data usage and consumption through the EmFi’s. Money, value, and wealth are generated and exchanged, overshadowed by the value of the data generated. Edge also impacts consumers as will be shown further below.
The?Central Bank Digital Currency?(CBDC) will require a robust digital network, therefore 5G[2]. The digital economy national currency will run on 5G to produce the aggregate goods and services of any national digital economy. EmFi’s today are running on digital fiat and crypto currencies but will be migrating to #CBDC little by little.?
5G will allow the #CBDC digital currency to be the?preferred currency?regulations are meant to protect; it is one of the glands, in consistency with the life science analogy we are using here. At the level of 5G, EmFi, and ChatGPT, regulations or RegTech will have to keep leapfrogging until CBDC reaches its place in the digital Irving Fisher equation.?
When regulations catch up and CBDC becomes the neural link between the #EmFi’s,?data and money will merge. At the macro-economic level, all monetary exchanges will be recorded on the immutable blockchains. With #openAI running through it. The national chief accountant will have all national data on one consolidated ledger. Before 5G, the network stability and strength would not allow or justify CBDC.
When CBDC becomes activated within the OECD and or across countries and the central banks within, the BIS (Bank of International Settlements) shall start exchanging on SDRs or the World Bank currency, and there will be an added layer of regulatory protection. Each of the countries will have its own 5G network blooming their CBDC and the EmFi’s. Imagine the impact of the smallest of bugs at this level. Mobile Applications and EmFi’s are mostly international. When you use any application on your smartphone, you will be triggering an EmFi movement using the 5G all the way to the CBDC international BIS settlement. Can you count the data cells that would have been stimulated??
The digital G in a national GDP equation is represented by?GovTech, that means all EmFi’s related to the public sector. Whatever we #SEO communicate, pay, collect, store, scrape (from mobile #scraping), navigate, read, or print is measured and cumulated. The 5G capacity, resilience, speed, and security have allowed GovTech to be trusted by both users and the public sector. Through 5G, the GovTech EmFi’s will replace all public sector offices and administrations.
When?taxes?are paid and collected by CBDC thanks to the 5G and the #EmFi’s, we will be moving towards a cashless society. This move will be a big cultural change in the countries resisting economic transparency and fiscal declarations. The 5G impact encompasses all economic sectors, it is a generalized development of the national digital economic landscape.
When citizens are offered payments, compensation, Covid subsidies, medical reimbursements through GovTech EmFi’s over 5G using CBDC, they will be encouraged to embrace these digital technologies for collecting and paying all public sector monies.?Transfers payments?collections will have all beneficiaries install and use the G #EmFi App.
GovTech is one of the biggest sources of sovereign data running on 5G, especially when?all the public administration functions?embrace it. The combined impact of 5G, EmFi, CBDC and data aggregation through GovTech is far reaching, this means the share of the digital economy out of the national economy will grow, this also means that the aggregated digital and traditional macro-economies will also grow at the same time and by the same forces.
2.?????Corporate
The I in the national digital GDP are the EmFi’s. The?corporate?world is moving towards digital transformation and 5G is there to enable it. Digital transformation is populating the EmFi’s because consumers | subscribers | users are mobile first. Investment in CapEx is investment in IT and towards strengthening the mobile applications.
Subscribers are the first fast movers to digital, followed by the SMB’s. The public sector can leapfrog into GovTech given the right circumstances.?Traditional business will move to digital only after coercion and market pressure. The greater the fear the faster the transformation. When they do decide, they will have to embrace 5G and the EmFi combination.
While the 5G network is being populated by Emfi’s, traditional enterprises are prisoners of their comfort zones, they have their own understanding of digital. They confuse digital with automation.?It will take them time to accept?and understand in case they survive.?
When an economic vertical is disrupted,?the enterprises will jump ship into digital?or drown. ChaptGPT will convince those with the withering mindset. If 5G and ChatGPT are not strong convincing arguments, the digital economy will not be waiting for them. SuperApp marketplaces will soon replace them.
The digital economy will be taking the upper hand on the consolidated economy.?The 5G will enforce the #openAI capabilities on the #EmFi data. The traditional bystanders will be squeezed between the 5G mobile subscribers, their digital competitors, and the GovTech.
The blatant example on traditional enterprises are the?large traditional banks. They are now shaken and stirred by SVB, CS, DB stock value losses. They are on a digital transformation trip, but the whole vertical is in a seism, each Friday a bank, Financial Regulators and Bank Boards are now working on weekends. These are on the wrong side of the 5G | EmFi digital spectrum.
5G and EmFi’s cannot carry the economy without the banking muscles.?Digital banks?are not yet equipped to carry the corporate trade finance. This is one reason why the traditional sector is solidary. This solidarity is delaying the CBDC implementation, notwithstanding the digital opportunities.
Traditional banks seek savings?and, on the way, to moving towards wealth management. These concepts are not directly related to 5G technology and EmFi. The US$ trillions assets of the largest banks will never sit on an application. This explains that cashless will never be a final destination. The traditional economic sector will need to stay and wait for a while.
Nobody can deny that 5G and EmFi are a favorable enabler for digital and neo banks. The digital banking technology is offering its services for the traditional bank to transform them into?BaaS?(Banking as a Service) providers by monetizing their assets, resources, and relations.[3]
The digitized enterprises will have the advantage to benefit from the 5G. Digital is connectivity, local and international. As digital enterprises behind the EmFi’s get interconnected, trade finance can become digitized and cryptographed, paving the highway towards?embracing CBDC.
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When the UX digital experience is complete end to end, it does not have to stop at the EmFi application. Real digital is the digital processing behind the app, by machine learning, artificial intelligence or #open AI. This includes the CRM, ERP, reconciliation, supply chain management, and settlement. CRM and ERP are closed loops. But reconciliation, supply chain management, and settlement can be linked through APIs with partners for digital and through?smart contracts?for cryptography. The 5G networks are reliable and crypto friendly because fast, secure, and equipped for high throughput. The connectivity technology layer can be taken for granted.
When the process reaches?#cryptography over 5G, using #blockchains, #smartcontracts, and #OpenAI with #chatGPT; the EmFi account reconciliation, approvals, and confirmations will be permanent, continuous, reliable, and less costly.?
The digital or?crypto settlement?will be enabled by 5G, in any flavor: fiat, crypto or #CBDC. It depends on the regulations and contracts: payment cards, SEPA, USDT, and the favorable exchange rate. The traditional corporate world will move with banks towards this digital and EmFi ecosystem little by little.
3.?????Subscribers
Mobile?Subscribers?are the C of the digital national income. The 5G subscriber data is subject to AI on the root basic source operator level. That means the data is continuously being collected while using the EmFi app, before and after. The GDPR or equivalent will be managed by consent according to the conditions of each country. From a technology standpoint, whatever data Alphabet and Meta can collect and use, mobile operators and, maybe, chatGPTn can also be able to use.
The IoT will become more widespread with the 5G technology. Things will become data generators or paying consumers. 5G will widen the scope of the economy by including new consumers and faster transactions: Impact of 5G on Fisher’s MV;?FinTech of Things.
When a?refrigerator sends?an automated message to the supermarket delivery service that it is low on dairies or beer, a transaction and payment are executed thanks to 5G without human intervention. The EmFi will manage the deal and report it.
Things?will become buyers. Just like a wealth management transaction is executed by a robo-advisor. 5G e-SIMs can empower appliances to become EmFi paying users. Transactions will be triggered by sensors.[4]?IoT of FinTech and or FinTech of IoT.
Digital business imagination is widest when we contemplate the possibility of?AI’s buying and selling from other AI’s. Robo-advisory wealth management trading is based on AI, hyper-speed trading is enabled by 5G. EmFi’s trading with EmFi’s on subscribers’ behalf.
When embedded finance is not based on a mobile application, it will be on a laptop or on a supercomputer. The digital support host can differ and the?5G Edge?technology and multi-tenant possibilities is a business vertical by itself.[5]?Typically the Edge can serve very high capacity because the data does not have to travel back to the central core.
The Edge is the friendliest environment for the?metaverse. All games, simulations, digital life experience, xR content, NFT, and any combination thereof can be deployed. These services are a case of augmented EmFi where users are prepared to pay a much higher premium for the privilege.
Because of the abundant 5G capacity, the?supercomputing?can be fully utilized on the Edge. The 5G network technology is more robust than 4G, but the Edge really provides the sensorial experience and shows its edge. Pun intended, as usual.
The metaverse is the best case for the?augmented EmFi. Not all digital experiences can be lived on the mobile. The Edge can create the right environment when the facilities are physically equipped to host these Edge services. The physical building will become the EmFi.
The 5G technologies promises new industrial breakthroughs. Coming back from MWC23 Barcelona, the technology shows are still fresh. For example, the case of using 5G to obtain assurance that a nut has been fixed to a bolt during an aircraft maintenance job.
New types of careers were invented with digital: social influencer, SEO expert, digital marketing, editor optimizing and more. Some will disappear because of ChatGPT; but overall,?the 5G combination with EmFi will have a positive impact on employment.
Players, verticals, and industries are moving to digital progressively. The #5G technology will convince the recalcitrant as the smartphones become cheaper and more available. We are heavily overdependent on connectivity, be it Wi-Fi and mobile, and ever seeking for speed on the apps and the #EmFi’s we are using.?
As Users spend more time on their 5G smartphones, they will be consuming on EmFi’s either by spending or by?nurturing the database of their behavioral activity, or both. The #OpenAi and #ChatGPT behavioral data will then be used to incentivize the Users to spend.?
There will be more TikTok’s, more WeChats superApps; this means more use cases for the 5G and EmFi combinations.?Every new SuperApp EmFi will be a marketplace on its own, an Amazon on its own. Watch Ali Baba disintegrate itself into 6 as this Article is posted. Amazon will become a generic product, the biggest example being Jumia in Africa. Nobody can stop and prevent Users from consuming a free service.
Dr. Caesar J.
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[3]?For more on this matter, please refer to my Insidetelecom magazine article in issue 3 on the link:?https://insidetelecom.com/magazine/inside-telecom-magazine-issue-3/#dearflip-df_29237/53/?page 50 and in April’s 2023 issue 5.
[5]?More on this in my second article in this series published on LinkedIn titled: How does 5G add value to Web3.0 and what business opportunities this digital combination will create.?https://www.dhirubhai.net/pulse/how-does-5g-add-value-web30-what-business-digital-combination-jabr/