Miller/Howard Investments
Miller/Howard Podcast Series
5G Infrastructure Series
Part 2: Hype versus Opportunity and Timing
5G and the automation of everything.
Bryan J. Spratt, CFA, Portfolio Manager  |  Full Bio (PDF)
Listen:  
5G Infrastructure Series: Part 1 - Progression to 5G: Looking to the Future
5G Infrastructure Series: Part 2 - Hype versus Opportunity and Timing
5G Infrastructure Series: Part 3 - How MHI Invests in 5G Today

Transcript:

Welcome to the Miller/Howard Investments Podcast. This is the 2nd part of a 3-part discussion about 5G Infrastructure. Today, we invited Bryan Spratt, Portfolio Manager, to discuss 'Hype versus Opportunity and Timing.'

Hello, I'm Bryan Spratt. In the first podcast, we discussed the progression of 5G and ended by pointing to how 5G will significantly improve speeds, lower latency and provide the ability to connect many more devices all at once. So how fast? Industry forecasts suggests 10 to100 times faster than 4G and some estimates are even higher—up to 10x decrease in latency—think responsiveness, 3x spectrum efficiency, and 10x connection density and will be able to better optimize network energy consumption with estimates of 100x greater network efficiency. The goal at this point is aiming for 20 gigabits speed with less than 1MS latency, with some tests already at 30 gigabits download speeds. What 5G means is potentially the end of the "wheel of death," as we now wait for a movie download.

But this also means 5G is expected to be 100x more complex, but should allow different networks the ability to communicate more seamlessly. This is why Qualcomm refers to 5G as the Unifying Connectivity Fabric. The chief technology officer at Nokia [Marcus Weldon] said, "5G will give birth to the next phase of human possibilities, bringing about the automation of everything,"

5G is climbing the hype cycle and we are not sure we agree with one firm [Qualcomm] suggesting it could be as "transformative as electricity." But as 5G becomes the new standard, it has the potential to fundamentally transform the digital revolution.

5G is getting a lot closer to reality than many think. We like a recent quote by the head of wireless networks at Verizon who said, "We don't wait for the future, we build it." And this is another great example of moving the industry forward."

Verizon announced plans to offer commercial 5G in 3 to 5 cities by the 2H2018 and the first target on their radar along with new services is the lucrative revenues from cable broadband customers. The bundle (wireless, broadband, and video) just got a lot more flexible with 5G approaching. Superfast and efficient mobile broadband is another example of cord cutting—yet depends heavily on the fixed network that requires a significant amount of fiber, small cells, advanced radios and antenna technology, and towers working together to make it all work.

AT&T, Sprint and T-Mobile have also announced 5G network plans and timetables, along with most of the major global operators around the world.

Bottom line: the network has been evolving and upgrading for a long time, but 5G will be a giant leap forward. Target markets will begin to see roll-outs in 5G to customers later this year and expect it to be more widely available by 2020. 5G smartphones should start to be available in 2019 and estimates suggest $50 to $100 billion will be spent in the coming years.

Thank you for listening. Do you have any questions? We can be reached on LinkedIn by searching for Miller/Howard Investments and on Twitter: @MH_Investment. If you enjoyed this podcast episode and would like to hear more, please follow us on YouTube (our channel is mhinvest), iTunes (search for Miller/Howard Podcasts). In the upcoming episodes, we will discuss 'The Progression to 5G' and 'How Miller/Howard Invests in 5G Today.' We hope you can join us.

To learn more about investing in infrastructure, please call our home office at 845-679-9166 to speak to one of our sales professionals.

As of March 5, 2018, Miller/Howard holds NOK, QCOM, VZ, and T in our portfolios. We do not hold S, and TMUS in any of our portfolios.

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