For all of the hype surrounding 5G cellular technology — the super-fast download and upload speeds, massive bandwidth, and incredibly low latency — it’s still not available in most areas. In fact, what is available, especially of the fastest version of 5G, in some regions, is limited to just a few city blocks.
But according to Qualcomm president Cristiano Amon, that should change by the end of this year.
“We should see 5G in all metropolitan areas in the United States, as well as in China, Korea, Japan, and Europe towards the end of 2020,” Amon told Yahoo Finance during an interview at the World Economic Forum in Davos, Switzerland.
5G is expected to be a major driver for Qualcomm (QCOM), as well as the tech industry at large, as the wireless standard begins to take root across consumer and commercial devices. And according to Amon, it’s already paying off for the company.
Throughout 2018 and 2019, Qualcomm and Apple were locked in a fierce legal battle over royalties for Qualcomm’s technologies, with Apple alleging that the chipmaker was abusing its powerful position in the tech industry to force companies to pay excessive fees for its patents.
The two companies settled in 2019, but the FTC is still fighting its own battle with Qualcomm over its alleged monopoly power in the tech space.
Obstacles and expectations
Qualcomm doesn’t create the actual infrastructure for 5G technologies. Rather, it produces the chips and modems that add 5G to commercial and consumer products. In fact, it’s Qualcomm that will likely bring 5G to Apple’s next version of the iPhone, which is expected to launch in September 2020.
So why doesn’t 5G, something that companies have been pushing for years, have the kind of coverage as current 4G LTE networks? According to Amon, part of the issue is that companies have to get permits to put up their 5G antennas.
And since high-end 5G connectivity, like Verizon’s (VZ) millimeter-wave 5G, requires companies to deploy far more antennas than 4G LTE, the permitting process is causing slowdowns.
(Verizon is the parent company of Yahoo Finance)
Whether we’ll actually see ubiquitous 5G connectivity across the U.S. by the end of the year remains to be seen. It took years for the Big Four wireless carriers to build out their current 4G LTE networks and being able to do the same with 5G in such a short amount of time sounds quite ambitious. There’s still no complete estimate of how long it will take to get 5G coverage throughout the U.S.
There are also two different versions of 5G, the aforementioned millimeter wave, and what is called sub-6Ghz 5G. Sub-6Ghz 5G will provide far more coverage than millimeter-wave 5G, though it won’t have quite the speed and performance as millimeter-wave.
T-Mobile (TMUS) is banking on its sub-6Ghz 5G to help it quickly increase its 5G coverage area.
Qualcomm Long (Buy)
Enter at: 89.73