The world is moving towards 5G mobile technology – the fifth generation of mobile network. It’s a new kind of network that will not only interconnect people, but also machines, devices and objects. 5G is expected to have a totally transformative impact on global industry, enabling firms to offer connected services with top performance and efficiency, and at a low cost.
According to multinational semiconductor and telecommunications firm Qualcomm, based in the US, the global 5G standard “will advance mobile from largely a set of technologies connecting people-to-people and people-to-information to a unified connectivity fabric connecting people to everything.” The firm expects 5G’s full economic benefit to be realised worldwide by 2035, when it could produce up to US$12.3 trillion worth of goods and services enabled by 5G mobile technology.
It’s a real force to be reckoned with, and something insurers need to be thinking about right now, according to Brad Gow (pictured), global cyber product leader at Sompo International. As 5G mobile technology spreads around the world, networks will move away from hardware-based switching to more distributed and software-defined digital routing, which involves many more nodes communicating with each other.
“What that does is it really opens up the surface area that’s vulnerable to cyberattacks,” said Gow. “And so, as we approach 5G in the next couple of years, we need to think about network security. The way that networks are secured today is going to need to be completely re-thought in order to incorporate all of this technology and all of this new bandwidth. That’s going to really change the game for cyber insurers and it’s going to be a real challenge for the insurance industry. It has certainly captured my attention because a lot of this technology will be coming online in the next two or three years.”
It’s not just the emergence of 5G technology that’s caught the attention of Sompo International’s global cyber product leader. There’s also the growing prominence of quantum computing. Data scientists worldwide have tipped quantum computing to change the world in the near future. Sparing the technical details of quantum computing (which are incredibly complex), its benefits are clear: it can process massive and complex datasets much more efficiently than classical computers.
“It’s still early days in quantum computing, but once the power of computer processing expands exponentially, current encryption technology is going to be rendered obsolete,” Gow commented. “That’s significant because we depend upon encryption very, very heavily today.”
While quantum computers in the wrong hands could pose some serious cybersecurity challenges, in the right hands they’re doing the world of good. Quantum computers are already being used to reinvent aspects of cybersecurity because of their ability to break codes and encrypt electronic communications. What insurers need to do, according to Gow, is keep their fingers on the pulse of these advancements.
“We’re in a period of rapid technological change,” he told Insurance Business. “To some degree, it could be argued that the insurance industry has gotten a little bit over its skis in terms of the breadth of coverage it’s offering, and the prices it’s offering, especially when there are so many variables that have the ability to threaten corporate networks, not only today but over the next few years. It will be interesting to see how this all develops.”