Back in 2018, T-Mobile (TMUS), Verizon (VZ) and AT&T (T) started announcing the transition from 4G to 5G. Today, all three networks lay claim to having nationwide coverage (TMUS, VZ, T). And component manufacturers like Qualcomm (QCOM) and Broadcom (AVGO) have been busy, not just with developing and manufacturing all the chips and signal processors necessary to transition from 4G to 5G but also with working on the next iteration of connectivity, which is known as 6G.
Virtuous Circle
The Virtuous Circle comes about when, given a certain amount of bandwidth and throughput speed, developers create new ways to wring as much utility out of that infrastructure as possible. As developers continue to provide new applications and generate increasing amounts of data, they will bump up against the limitations of the current network. This in turn will prompt infrastructure providers to further optimize and expand global network capabilities, which will provide more room for developers. And the cycle repeats itself again and again. It is our strong belief that this process will continue until everyone on the planet takes the position that we, collectively, have enough digital bandwidth and speed. In short, not any time soon, if ever.
6G? I Thought 5G Was The Future
When providers first started talking about 5G, it seemed like it was the answer to all our 4G problems. Because 5G operates on a much higher frequency band than 4G, it provides a huge improvement in the amount and speed of data transmission. Higher frequencies mean shorter wavelengths (measured peak to trough), which translates to a physically smaller antenna. This also means that signals can be better directed, using significantly less electricity to broadcast as Nokia (NOK) found in a study. It is estimated that the ability to hold more antennae means base stations will be able to support 1,000 more devices per meter as compared to 4G. The most noticeable improvement is network speed, with 5G coming in at 20X the transfer rates of 4G.
