NEW YORK, NY, USA, 1 December 2021— Deloitte Global has released its Technology, Media & Telecommunications (TMT) Predictions 2022 report, which identifies the global TMT trends most likely to impact businesses and consumers in the coming year. The report explores how many of these trends are currently being driven by economic and societal shifts brought on by the global pandemic.
“The COVID crisis continues to accelerate our adoption of technology and increase our levels of connectivity via the digital world,” said Ariane Bucaille, Deloitte Global Technology, Media & Telecommunications Industry leader. “There is enormous demand for chips as more and more products become digitally connected, powering everything from our multiple devices to smart vehicles. And connectivity is only going to expand with such technologies as Wi-Fi 6 and 5G, reinforcing the rapid digital transformation all industries and businesses are currently witnessing.”
The world is hungry for products enhanced by a growing volume of chips, but there will be delays throughout 2022 until supply catches up with rising demand. Deloitte Global predicts that many types of chips will still be in short supply during 2022, but it will be less severe than in most of 2021, and it will not affect all chips. The duration of the chip shortage boils down to a significant surge in demand, driven by digital transformation and accelerated by the pandemic. It is not just the proliferation of consumer devices, it’s the fact that many mechanical products in industry are becoming increasingly digital, and many vertical sectors are becoming more reliant on digitization.
Unsurprisingly VC investment in semiconductors is taking off to fill the demand for new kinds of chips. Deloitte Global predicts that VC firms globally will invest more than US$6 billion in semiconductor startup companies in 2022. That may only be 2% of the US$300 billion-plus of overall VC investment expected for 2022 but more than three times larger than it was every year between 2000 and 2016.
In addition, RISC-V, an open-source instruction set architecture for chip design, is gaining market traction, and attracting investment. Deloitte Global predicts that the market for RISC-V processing cores will double in 2022 from what it was in 2021 because it will allow smaller device manufacturers to build hardware, allow Chinese chipmakers to avoid sanctions, and allow developers and researchers to design and experiment with a proven and freely available instruction set architecture.
The last two years saw many countries adopt 5G, but Wi-Fi 6 devices are now quietly outselling 5G devices by a large margin and will likely continue to do so for the next few years. Deloitte Global predicts that more Wi-Fi 6 devices will ship in 2022 than 5G devices, to the tune of at least 2.5 billion Wi-Fi 6 devices versus roughly 1.5 billion 5G devices. The reason for this is that Wi-Fi 6, just as much as 5G, has a significant role to play in the future of wireless connectivity not just for consumers, but also for the enterprise. Smartphones, tablets, and PCs are some of the most popular Wi-Fi 6-equipped devices, but Wi-Fi 6 is also used in many others, including wireless cameras, smart home devices, game consoles, wearables, and AR/VR headsets.
Kevin Westcott, Deloitte Global, Telecommunications, Media & Entertainment Sector Leader, said: “Though Wi-Fi 6 and 5G are equal partners in terms of building solutions, our survey shows that enterprise Wi-Fi 6 pilots and deployments are outpacing 5G. One likely reason is cost, as Wi-Fi 6 devices are more affordable and more widely available than 5G devices, and because Wi-Fi 6 uses free, unlicensed spectrum, and 5G generally requires enterprises to license spectrum from network providers or government entities.”
Advances in sensors and artificial intelligence (AI) are helping millions detect and manage chronic health conditions and mitigate serious illness, and these technologies are now small enough to be worn on a wrist or penny-sized patch and are seeing rapid growth. Deloitte Global predicts that 320 million consumer health and wellness wearable devices will ship worldwide in 2022, and by 2024, that figure could reach 440 million units. This is being driven by new offerings hitting the market and more health care providers becoming comfortable with using them. Their impact will increase even more if doctors trust their utility and people feel their data is secure. Similarly, there is strong growth in mental health apps, and global spending on mobile mental health applications will reach close to US$500 million in 2022. This annual growth is fueled by the fact that nearly 800 million people worldwide, or 11% of the global population, live with a mental health condition. Moreover, the pandemic has exacerbated mental health concerns and triggered declines in well-being, with a dramatic rise in the prevalence of problems such as depression, anxiety, and post-traumatic stress symptoms.
“The pandemic has been a catalyst for both consumers and medical companies to really push forward self-quantification and health monitoring. Thanks to advances in technology, everything from diagnostics, monitoring, sensors and data sharing has vastly improved. Coupled with the miniaturization of consumer wearables today, we use digital connectivity to manage our health more than ever. The same applies to managing wellness, and today there are more than 20,000 apps focused on helping manage mental health, this upward trend will continue in 2022.” said Gillian Crossan, Deloitte Global, Technology Sector Leader.
Non-fungible tokens (NFTs), unique digital identifiers that use blockchain to record ownership of media, are now letting sports fans acquire, not just view, licensed digital media of their favorite sports moments. Encompassing many items from trading cards to digital video, sports NFTs will likely cement non-fungible tokens’ place in the sports content marketplace. Deloitte Global predicts that NFTs for sports media will generate more than US$2 billion in transactions in 2022, about double the figure for 2021. By the end of 2022, we expect that 4–5 million sports fans globally will have purchased or been gifted an NFT sports collectible. Interest in sports NFTs is likely to be spurred by activity in the wider NFT market, including that for digital art, the top five most valuable sales of which had generated more than US$100 million by August 2021.
The games console ecosystem celebrates its 50th birthday in 2022 in strong health with record revenue, a full slate of latest generation devices, and a strong foundation for further growth. Deloitte Global predicts that the console market will generate US$81 billion in 2022, up 10 percent from 2021. Revenue per console player, of whom there will be 900 million by the end of the year, are expected to average US$92 per person substantially more than the projected US$23 per PC gamer and US$50 per mobile gamer. Beyond 2022, console software sales are expected to continue growing, reaching close to US$70 billion by 2025. Over this period, digital game purchases, including downloads, subscriptions, game passes, and in-app payments are expected to rise as a share of sales from 65% in 2022 to 84% in 2025.
As leading streaming providers expand globally while national media companies spin up their own domestic streaming services, the amplified competition is creating abundant consumer choice and churn is accelerating as a result. Deloitte Global predicts that in 2022, at least 150 million paid subscriptions to streaming video-on-demand services (SVOD) will be cancelled worldwide, with churn rates of up to 30% per market.
Deloitte Global’s annual TMT Predictions report provides an outlook on technology, media and telecommunications trends that may disrupt and transform the business and consumer ecosystems worldwide. Visit www.deloitte.com/predictions to learn more and connect with Deloitte on Twitter: @DeloitteTMT, @Deloitte and LinkedIn: @Deloitte.