The War Behind The 5G Revolution

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Nadero Wealth Management

A two-hour film can be downloaded in 6 to 10 minutes, and that is with the current communication technology at 4G. With 5G, we are talking 7 seconds.

You may wonder what all the noisy attention-grabbing headlines and noise is all about with 5G, and why governments worldwide have escalated the race as being nothing short of vital national security concerns. It is simple as this, whoever controls the 5G space rules the world – and therefore controls the future.

Trump coming in with thunderous fanfare to save US companies by attempting to take Huawei out of the loop is a blatant attempt to derail the Chinese tech giant for having the temerity to encroach on what the US feels is its turf and moreover further expanding its technological clout. We can’t be 100% certain if the move is to protect American interests, but this action has escalated the trade war with China into a technological war.

In the race to 5G supremacy, all indications are now pointing to the Chinese gaining technical advantage and leading the pack in the global marketplace. This understandably makes the US very uneasy. China’s lead is also tied to its growing economic dominance and rapid growth. They are seemingly overtaking everybody in everything. For decades, China’s growth rate stood at an all-surpassing 8% + while the US grew somewhere between 2-3%, while the economies of western Europe skirted with low growth, high unemployment, and incipient recessions.

An economy such as China that is fired up is setting the perfect environment for the entry of 5G capable phones – which is good news for the likes of Huawei. This is precisely the development needed to abet the faltering mobile phone market. Sorry, but Apple just lost the war on 5G.

5G is all about speed. That means faster access to the internet and will, in all likelihood, translate to faster payment processing systems and clearer video calls. Right now, the race is also with the infrastructure build-up. Here, we see the big three players of Huawei (29% market share), Nokia (17% market share) and Ericsson (15% market share) spending billions of dollars in the next 5 to 10 years to build communication towers, antennae’s and improve software.

Infrastructure set up is more pronounced in China. Three of its largest telecom providers: China Mobile (HKG:0914 & NYSE:CHL), China Telecom (HKG:0728 & NYSE:CHA) and China Unicom (HKG:0762 & NYSE:CHU), as well as to the state-owned China Broadcasting Network Corporation are up to the challenge of making China a comprehensive 5G country. Mobile China has recently announced that 5G services will be available in 40 cities by the end of December. Now, China leads, and the world looks east to follow.

This upsets the US so much that Trump even tweeted “I want 5G in the United States as soon as possible”. That was sometime last March this year. Two major US players AT&T (NYSE:T) and Verizon (NYSE:VZ) heeded to the President’s tweet and announced that they would replace all their fiber broadband equipment with 5G. There is a problem; however, the equipment needed to set up a 5G infrastructure is made by Huawei. So, in effect, Trump just killed his own 5G dream. Well, there is Nokia and Ericsson, but if industry reports have it, Huawei makes better 5G equipment.

Amidst all the headlines that you’ve read on your feed about 5G and health issues; namely that it will fry your brains or that 5G microwaves will be the end of life on earth as we know it, 5G is a game-changing development on how we will experience the web. It has the capability to transfer user experience through fixed wireless broadband rather than via internet telephony.

Remember when people switched from Nokia to the smartphone? That is exactly what 5G will do with the telecoms industry. And by the looks of it, the Chinese have the advantage.

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