Forget 4G LTE (Long Term Evolution), the stage is set for 5G wireless race in the U.S. telecom space. With the U.S. telecom industry continuously evolving, companies in the sector are fighting it out to stay ahead of the curve.
A growing U.S. economy speeds up the demand for real-time voice, data, and video manifold. The escalation in demand has encouraged telecom service providers to undertake large network extensions while upgrading plans. Wireless operators will thrive on 5G network in 2019.
Strong Wireless Market
With rapid growth in video and other bandwidth-intensive applications, the wireless industry participants are making considerable investments in LTE, broadband and fiber in order to provide additional capacity and ramp up Internet and wireless networks. The LTE network has the highest penetration rate of 91% in the North American region.
The impending 5G boom is likely to propel the wireless industry to newer heights. The success of 5G technology hinges on substantial investments to upgrade infrastructure in the core fiber backhaul network to support anticipated growth in data services.
Advantage of 5G Wireless Network
The United States is progressing well to lead the world in 5G — the next generation of wireless connectivity — which will enable faster speeds and low latency wireless broadband services. 5G networks will be ten times faster than 4G networks. Although 5G network is not likely to replace existing 4G standards on large scale before 2020, several telecom behemoths are expected to launch 5G smartphones in this year.
Latency period of 5G data delivery will be in milliseconds. Further, 5G technology is designed to be more power efficient than any other standard wireless network available now. Consequently, 5G-enabled mobile devices are likely to last significantly longer than their 3G or 4G counterparts.
The rising demand for technologically superior products has been a silver lining for the telecom space in an otherwise tough environment. In this respect, the superfast 5G mobile networks will be of utmost necessity in managing the exponential growth of internet-connected devices, popularly known as Internet of Things (IoT).
While 3G wireless network enabled seamless internet connectivity to mobile phone. 4G standard helped companies which thrive on mobile connectivity. Notably, 5G wireless network is likely to boost high-tech artificial intelligence-based products significantly.
Major 5G Network Operators
In the United States, all four national wireless operators – Verizon Communications Inc. VZ, AT&T Inc. T, T-Mobile US Inc. TMUS and Sprint Corp. S will start rolling 5G networks in 2019.
Moreover, United States Cellular Corp. USM, Comcast Corp. CMCSA and Charter Communications Inc. CHTR are also likely to follow suite. Sprint carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The chart below shows price performance of major 5G wireless operators in the past one year.
The need to remain connected is a human condition. An era of digitization and technology is essentially built on this need. It is here that telecommunications come to the fore as a necessary utility. In 2019, we expect 5G wireless network to be a game changer in the telecom space with a full-fledged deployment in 2020.
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