Digital future now zooming into reality
The long-predicted virtual world has suddenly arrived, writes
The lockdown gripping much of the world economy has spurred a real-time stress test of the longheralded digital future. Virtual lunches have replaced office gatherings; schools have rushed out internet-based learning; and the US Supreme Court for the first time will hear arguments by telephone and allow live audio broadcasts.
Lockdowns have seen millions lose their jobs as waiters, flight attendants, Pilates instructors and other service providers are closed. That means sustaining those sectors that can function online has never been more important for the global economy.
Gauging the size of the digital economy isn’t easy: the UN Conference on Trade and Development estimates a range of 4.5 per cent to 15.5 per cent of global gross domestic product. While that varies by country, it’s clear that the companies and nations which can migrate the most commerce online will go some way to cushioning the damage.
“The futurists are going to have a field day,” says Mark Herlach an international lawyer at Eversheds Sutherland in Washington DC. “It will change the way we build our cities, the way we move around in those cities and that in turn changes our energy use. A whole series of knock-on effects are coming.”
Herlach — who has had to steer negotiations between clients and government from his home and has used video happy hours and dinner parties to stay in touch with colleagues and friends — is positive on the experience so far, but worries about a lingering sense of isolation if more opt to work remotely once the lockdowns ease.
Cheaper internet connectivity has enabled explosive growth in online tools, allowing many white collar roles to be done at home and keeping managers and business owners in touch with their staff.
Users of Microsoft Teams soared to a daily record of 2.7 billion meeting minutes in one day, a 200 per cent increase from 900 million on March 16, the company said on April 9. Even amid security concerns, Zoom has gone from being used by 10 million office workers a day to more than 200 million people.
“‘Zooming’ has become a new verb,” says Michael Bowes, a barrister and joint head of Outer Temple Chambers in London. He and his colleagues hold a “Virtual Tea Zoom Group” at 4pm every Wednesday, where everyone brings their own tea and cake for a chat.
Already, some companies have an eye on how they’ll change operations even when the virus dissipates. Some are looking at cutting expensive travel and real estate budgets in favour of investing in better technology and home office set-ups, says Satish Shankar, regional managing partner of Bain & Company Asia-Pacific.
Investment strategist Ed Yardeni focused a recent research note to clients on how he has adjusted to a world of meetings and cocktails over video link during what he calls the great virus crisis, or GVC. “Technology has become a GVC staple, right up there with food and toilet paper,” wrote the president and chief investment strategist of Yardeni Research.
Perhaps no sector has been as upended as education, with school closures affecting 90 per cent of the world’s
students, or more than 1.5 billion people according to Unesco. That has forced teachers to launch online courses with little warning, with knock-on consequences for the wider economy as parents are forced to adapt their working schedule around their children’s needs.
Authorities are grappling with cancelling or postponing critical final-year exams, or basing grades on past performance.
Wong Mo Yee, a primary school teacher and a member of the Hong Kong Professional Teachers’ Union executive committee, where schools have been shut for months, says the crisis highlights the need for clear goals about what should be taught at home instead of rigidly sticking with the in-class room curriculum. She also notes the dangers of too much screen time.
“Home learning is completely different, the interaction is different, the dynamic in the so-called video classes is also different,” Wong says. “It’s not so easy to engage students in video teaching.”
Poorer children have been hardest hit, where families either have to share devices or don’t have them at all. Families where parents have to leave home for work and cannot supervise their child’s learning have had it tougher still.
“The longer children are out of school and not learning, the increased likelihood they will never return to school,” says Heather Simpson, chief programme officer of Room to Read, which works to boost literacy in developing nations.
Manufacturers have also discovered the limitations of tech. One of them is Colin Ng, the co-founder of Hong Kongbased Lincogn Technology, which makes smart home appliances such as facial recognition door locks and mobile phone controlled lights.
Travel restrictions between Hong Kong and mainland China have disrupted the main artery between Ng’s small R&D team in Hong Kong and the company’s manufacturing staff in neighbouring Guangdong. That has complicated the process when a product is meant to move from R&D to the factory floor.
“Video conferencing the discussion is very difficult,” Ng says. “It is difficult to explain a lot of the detail through the camera, the conversation becomes very inefficient.”
Joerg Wuttke, president of the European Chamber of Commerce in China and a veteran of doing business in the world’s second-biggest economy, says remote working can only do so much for those in some roles. “Companies are pushing the envelope,” Wuttke says. “But at the end of the day, someone still has to get the coal and oil out of the ground and put solar panels together.”
There have been other strains too. Surging web use prompted President Donald Trump to hold talks with telecom giants to ensure the networks could cope. In Europe, Amazon.com, Netflix and YouTube had to reduce the quality of their video streams to ensure networks could handle increased usage.
In China, mobile broadband downloading speed slumped between mid-January and early February before gradually recovering by mid-March, according to network speed testing platform Ookla. Downloading speed in India and Malaysia has started to dip since early March as the pandemic outbreak spread.
The shift online has been a crucial safety net for a collapsing world economy and will change how we study, work and play even when the virus passes, says Chua Hak Bin, senior economist at Maybank Kim Eng Research in Singapore.
“Quarantines and lockdowns for such long periods would have been near impossible to impose and bear without the tech devices available today,” he says.
At the end of the day, someone still has to get the coal and oil out of the ground and put solar panels together.
Joerg Wuttke, European Chamber of Commerce in China