Since the dot-com bubble of the early 2000s, new, complicated and often incomprehensible technologies have rapidly emerged and firmly rooted themselves in everyday life, like one-click online shopping, Facebook friends, and fully electric, self-driving vehicles. Today, technological transformation progresses faster than humans can comprehend, and investors should take note. Since the 1990s, more than $56 trillion in new wealth has been created through equity markets, but only 1.5% of companies account for that wealth creation, many of them fabled technological disruptors like Microsoft Corp. (MSFT), Apple Inc. (AAPL), Facebook Inc. (FB) and Amazon.com Inc. (AMZN). What's the next major trend? A recent report from Bank of America Global Research recommends that investors place these seven "moonshot" technologies on their radar, ranging from the inevitable to the seemingly impossible.
In quick time, cellular networks have evolved to handle the rapidly growing amount of data the world produces. Today, 5G networks stand prepared to process this generation's data. But according to Bank of America, if "global data doubles every two to three years, by around 2028, global data capacity will be beyond current 5G capabilities." Enter 6G, capable of downloading all the data on the internet in "only" 17,000 years, a massive improvement compared to 830,000 years on 5G networks. Expected to debut around 2030, Bank of America believes, 6G technologies will have a market capitalization of $1.77 trillion by 2035 and shake up industries ranging from the obvious – telecommunications via network upgrades – to the not so obvious, such as data center REITs, semiconductors and cybersecurity. In one way or another, all of the following emerging technologies rely on the processing capabilities of 6G.
Previously a term from science fiction novels, "metaverse" today refers to integrated virtual environments where people or their avatars can engage in ordinary activities like shopping, socializing or dining, often through a virtual reality headset and always without leaving their home. What's more, the metaverse will also redefine video games, making them more immersive through 360-degree experiences and by creating new interactions between players and their environment. If that sounds too futuristic, Facebook, Microsoft and Walt Disney Co. (DIS) will confirm the reality. In 2014, Facebook acquired virtual reality company Oculus VR for $2 billion and has since launched beta phases for VR communities and work rooms. Meanwhile, Microsoft has invested in an "enterprise metaverse," which aims to create a digital twin for anything logical or physical, and Disney envisions a "theme park metaverse" where users can "visit a galaxy far, far away without ever leaving their home," according to former chief technology officer Tilak Mandadi.
Holograms take the metaverse one step further, using light to create full-size, scaled representations of any graphic a computer can render. Before Super Bowl LV this past February, famed coach Vince Lombardi, who passed away in 1970, appeared before the crowd and gave a rousing pregame speech in hologram form. And in May, technology company Musion 3D brought together loved ones 400 miles away for a first-of-its-kind holographic dining experience. Beyond these publicity stunts, expect holograms to accelerate work from home, transform schooling and add a tinge of reality to the nascent metaverse. Holograms will also increase demand for cloud computing and 6G; according to Bank of America, a hologram display over a mobile device requires at least half a terabyte per second, far more than what 5G can handle. Currently, Microsoft has developed HoloLens 2, an augmented reality headset, and emerging start-ups include Hypervsn, AV Concepts, Digital Domain and Base Hologram.
Perhaps one of the spookier emerging technologies to watch, brain-computer interfaces, or BCIs, connect human brains directly with digital interfaces to augment human cognition and thoughts. In 1997, IBM's (IBM) computer Deep Blue defeated world champion Garry Kasparov in chess, marking the first major victory for artificial intelligence, and since, AI has increasingly challenged humans in all almost activities, from shooting a basketball to identifying errors in legal documents. The next step: merge human and machine intelligence. Many companies already use BCI technology to find digital cures for cognitive and physically debilitating diseases, but into the future, BCIs could fundamentally change humanity's interactions with smartphones or computers and make dangerous, demanding jobs the work of robots controlled by human brains. Bank of America expects the market to reach $5.46 billion by 2030 and points to Neuralink, Synchron and Neurable as startups to watch.
eVTOL stands for electric vertical take-off and landing, a technology under development that could bring air taxis to life and reduce congestion on roads. In 2016, Uber Technologies Inc. (UBER) published a white paper that outlined its Project Elevate, an on-demand air transportation system, increasing the viability and validity of a once-futuristic concept. Uber spent four years spearheading the project before selling it in 2020 to Joby Aviation Inc (JOBY) for an undisclosed amount. This past August, Joby closed a business combination with Reinvent Technology Partners (RTPY), a special-purpose acquisition company led by LinkedIn co-founder Reid Hoffman, valuing the company at $4.5 billion in enterprise value and raising cash on the balance sheet to $1.6 billion. The company expects to have fast, quiet and efficient taxis in the air by 2024. Into the future, Bank of America expects eVTOL technologies to disrupt the automotive and commercial airline industries while demanding more data processing capabilities and accelerating the need for 6G.
It's worth remembering that a Tesla Inc. (TSLA) battery was once hundreds of lithium-ion computer batteries stacked together. Since then, efficiency and capacity have improved, but almost all batteries remain lithium-ion, and peak single-charge mileage and total lifespan may have already been reached. In 2020, Contemporary Amperex Technology Co. Ltd., a Chinese company that manufactures batteries for Volkswagen AG (VWAGY), Tesla, and Toyota Motor Corp. (TM), unveiled a battery that will last at least 1.2 million miles before needing replacement, compared to a current average of 150,000 miles, and would cost only 10% more. But this is just the tip of the iceberg. NextGen batteries will likely be powered by solid-state lithium, replacing the current flammable and environmentally harmful liquid solution and ultimately requiring far less mined metals and specialty chemicals, a major plus for the environment. Bank of America expects NextGen batteries to disrupt the automotive, metals and mining, chemicals and renewable energy industries.
Over the past 20 years, improvements in mining technologies and increased regulations have both improved mining efficiency and marginally reduced its environmental footprint. Current mining techniques, such as open pit mining, underground mining and brine mining, often release toxic chemicals into the ozone, destroy natural lands and habitats, and present dangerous work conditions for miners. Enter "green mining." Green mining aims to reduce the negative externalities associated with traditional practices as well as move mining activities from land to ocean. In fact, according to Bank of America, "deep sea mining could produce metals with 70% less CO2 emissions," and the bank projects that "by 2030, the global ocean economy could reach a gross value of around $3 trillion."
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