The introduction of the 5G network has been highly touted in the technological space, but will it really be as revolutionary as people think? Goldman Sachs analyst Rod Hall said the speed of the forthcoming technology “isn’t going to change much” when users actually experience 5G.
“We call 5G a brand, not a feature,” said Hall. “We don’t believe most consumers will notice a difference.”
“The latency reductions in 5G are beyond anything a human can perceive; they’re really designed for machines,” Hall added. “In terms of bandwidth, what you’ll experience in terms of speed isn’t going to change much. This is mainly a technology change.”
In particular, Hall referenced Apple who is making its own version of the iPhone that will support 5G technology. The iPhone maker is caught in the middle of a U.S.-China trade war, which could affect the stock moving forward as negotiations take place this month.
“It’s really about consumer demand and how strong the consumer is in China,” Hall said. “If they’re feeling worried about the economy, they’ll buy cheaper phones. And Apple’s not a cheap phone.”
Nonetheless, investors can still bank on wireless carriers looking to upgrade their infrastructure in order to support 5G capability. This is where investment opportunities in 5G infrastructure like the Pacer Benchmark Data & Infrastructure Real Estate SCTR Strategy (NYSEArca: SRVR) come into play.
Being able to transmit copious amounts of data at a faster rate is certainly of benefit for wireless companies and their users, but 5G could be a major disruptor in various industries. Before this occurs, however, the infrastructure to accommodate this enhanced technology must be in place.
With a buildup necessary in cell towers and distribution warehouses, a demand for public real estate could follow.
As such, investors can look at SRVR, which seeks to track the total return performance of the Benchmark Data & Infrastructure Real Estate SCTR Index. The index is generally composed of the U.S.-listed equity securities of companies that derive at least 85% of their earnings or revenues from real estate operations in the data and infrastructure real estate sectors.
Other factors that will affect the growth of 5G:
- 75 billion Internet of Things Devices by 2025 –Gartner
- 95% of workloads and compute instances estimated will be processed by cloud data centers by 2021 –Cisco Global Cloud Index
- 11X Growth -65% CAGR –Estimated total IoT traffic between 2018 –2023 –AV & Co. Research and Analysis
- 71.5% of global data center traffic within the data center itself
For an in-depth look at 5G, read this whitepaper and for more information on SRVR, you can view the fact sheet here.
For more market trends, visit ETF Trends.