Investors Must Understand 5G Wireless Growth Wave: Jeff Kagan

Jeff Kagan  |

Image source: ADMC / Pixabay

There is something every investor in 5G wireless must understand. Only parts of the wireless industry are rapidly growing. 5G wireless is different than 4G, 3G or any previous version. Understanding what 5G really means is key. The wireless industry has always been fast growing and always changing, but the growth opportunity for 5G is much wider and deeper, impacting more companies in more industries than ever before.

First, let’s understand what 5G really is. It is the fifth generation of the digital wireless data technology standard available from the nation’s wireless carriers like Verizon Wireless, T-Mobile, AT&T Mobility, US Cellular, C Spire, Xfinity Mobile, Spectrum Mobile, Optimum and many other small carriers and MVNO resellers.

Verizon, T-Mobile, AT&T, US Cellular, C Spire all offer 5G wireless

As the wireless industry moves forward, there are two parts to the puzzle, voice and data. These are two different services which operate on the same basic wireless network.

The speed increases on the wireless data side have been realized for decades for networks, smartphones, tablets and other wireless gear, both commercial and consumer.

In the past, each next-gen wireless data service has only impacted the wireless companies.

Today with 5G, however, that world is expanding to include a growing variety of other companies in other industries.

TeleHealth, Health Tech, connected cars, self-driving cars use 5G

Examples include healthcare with TeleHealth, Health Tech and Digital Health. This includes healthcare companies, emerging technology companies and evolving legacy companies as well. That is an enormous marketplace growth opportunity for both the wireless industry and the entire health care industry.

Other examples include the automotive industry with connected cars, automated driving, self-driving cars and more. The simplest versions keep car systems updated while the more extensive versions create an automated driving experience. This is also a huge growth opportunity for both the wireless industry and the automotive industry.

In fact, there are many industries like these getting their feet wet moving into the 5G world. Over the course of the next decade, we will see many other industries and many other companies move into this space.

Early adopters of 5G gain competitive advantage

Some will be leaders and others will be followers.

The early adopters will often gain a competitive advantage until the rest of the competitors catch up. Then it simply becomes a cost of doing business.

It is important to understand this new tech will simply become a necessary component to different industries.

Today, we see the investment each of these companies are making in each of these industries is enormous.

Qualcomm, Nokia, Ericsson, Intel, Oracle, Cisco, Huawei build 5G

That investment is helping companies like Qualcomm, Nokia, Ericsson, Huawei, Intel, Oracle, Cisco and others continue to see strong growth.

In fact, their growth opportunity is much deeper and wider than ever before because it involves so many other companies in other industries, not just wireless networks and handset makers.

That is an incredible growth opportunity for these large players and countless smaller players with big, transformative ideas.

This growth opportunity is not limited in any way. It serves the consumer, business customer, company, government and more, worldwide.

Any way you slice it, 5G is an enormous growth opportunity for every investor. As not every company will rush in at the same speed, however, choosing the right companies in which to invest is key, now more than ever.

Understand where each company is on 5G wireless growth wave

However, knowing the right companies to invest in is the tricky part. You must determine where the company you are considering is, on the industry wide growth wave.

This growth wave or growth curve theory is one key to understanding the right investment opportunity.

We must understand that all companies in the 5G space are not the same. Some are winners, others are followers and still others will struggle.

Companies are either on the rising side or falling side of the growth wave. It is vital you understand how they are performing in comparison to competitors.

Focus on companies on rising side of 5G wireless growth curve

You must find companies on the rising side of the growth wave.

As an example, Apple is on the rising side of the growth wave with the iPhone. Google is as well with Android. So is Samsung with Galaxy smartphones which uses Android. Plus, there are many others.

There are also plenty of companies that were once on the growing side, only to have crested and fallen. They didn’t have another growth wave to ride, so after they rose, they fell. Consider Motorola, Palm, Blackberry, Nokia and many others.

Some of these like Nokia, Ericsson and others created their next growth wave. Better late than never. They are one of the pack of 5G network builders. Motorola, on the other hand, is still making smartphones but has only a sliver of the size and scope it once enjoyed. Many others are today struggling.

Understand the 5G wireless Growth Wave Theory

Like any surfer will tell you, companies must ride the wave. They must stay with the growth wave as it moves forward. If not, they get left behind in the swell.

The companies that are still struggling simply did not understand the growth wave they were riding had a lifespan. They didn’t understand the wave is always moving. Some are longer and others are shorter, but all companies ride the wave either up or down.

Companies must stay with the moving growth curve until it is finally exhausted. Then they must ride the next growth wave in order to remain healthy and strong, long-term.

The most successful companies on an ongoing basis are those that create and ride many different growth waves. This gives them the ability to protect growth into the future, long term.

That’s why it is key for investors to understand this growth wave theory to know where to invest.

5G represents an enormous growth wave if you know how to choose the right companies. You must ensure, however, that you have an awareness of which companies are on the growing side of the moving growth wave in order to win.

 

Jeff Kagan is an Equities News columnist, wireless analyst, consultant, speaker and author. Areas of interest include wireless, 5G, telecom, Internet, AI, IoT, pay TV, autonomous driving, healthcare, telehealth, Metaverse, mobile pay, new technology, drones, regulation, M&A, changing political environment and more. He has a strong following on Twitter and LinkedIn. Kagan has been an influential independent industry analyst and columnist for more than 30 years.His web site is www.jeffKAGAN.com, and you can follow him on Twitter @jeffkagan and on LinkedIn at www.linkedin.com/in/jeff-kagan/.

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Equities News Columnist: Jeff Kagan

Source: Equities News

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DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not necessarily represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer.

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