Everyone is always searching for the best companies. Investors are looking for the best companies to make money. Users are looking for the best quality and reliability. Workers are looking for the best companies to work for. There are always winners, losers and stallers in every industry. Let’s take a closer look at the wireless industry and who the winners will be in 2021 based on what we see right now.
First of all, 2020 was one crazy year with COVID-19, layoffs, shutdowns and the rest. Within all that chaos, there are three different groups of companies. Those who have been hurt, those who are doing business pretty much the same as before, and those who are exploding with growth.
And there are plenty of companies in all three categories.
COVID-19 not slowing 5G wireless transformation
In the wireless world, we have fully taken the initial steps into the new 5G environment. This buildout will take several years. This means building out and upgrading networks, smartphones and tablets and much more.
Remember, the changeover from 4G to 5G is not as quick and easy as flipping a switch. It takes several years and billions of dollars to upgrade wireless networks, handsets, smartphones, tablets and more.
This time around 5G is different than 2G, 3G and 4G. 5G will impact other industries as well as wireless. Not only will we see new players enter the competitive marketplace, but we will also see this technology empower transformation of other industries and governments.
Telehealth, Telemedicine, automated driving, self-driving cars and more
That means other industries like healthcare, automotive, retail and more will use 5G technology to expand. That also means many other companies in many other industries, along with governments and more will all jump in.
Think about telemedicine, telesurgery, automated driving and the like. These work today, but to be better, safer and more efficient we will see plenty of investment dollars pouring into this new world at every level.
This means a positive impact on many 5G wireless related companies both in the USA and globally. In fact, many companies are seeing strong growth in 5G despite the pandemic.
Qualcomm and Huawei are 5G, wireless network, handset builders
Qualcomm and Huawei are perhaps the two largest wireless 5G competitors on a global scale. Qualcomm has upgraded the wireless experience over decades for networks, smartphones, government and company systems.
Huawei is newer to the game. They are similar to Qualcomm. They are both in the business of building out and upgrading the wireless experience we all use every day.
They are the builders who upgrade networks, smartphones, tablets and other technology in the 5G world.
Apple, Android and Samsung make 5G wireless smartphones
That means they work with everyone including networks like AT&T, Verizon and T-Mobile here in the USA and many others globally. They also work with smartphone and tablet makers like Apple and Samsung.
This is a rapidly growing segment.
One question about Huawei is this. Will President Biden be any easier on the company in the United States? We’ll have to wait and see.
Ericsson and Nokia are smaller but important 5G wireless players
In fact, Samsung also makes chip sets as well but is a smaller competitor. They use their own chipsets for their lower model devices, and Qualcomm chips for their higher end smartphones and devices.
Companies like Ericsson, Nokia and others are also part of the 5G wireless race. While they do not do it all, they do compete in various segments and are important players in this game.
In fact, it is important to understand there are really only a very few companies who compete in this space. Qualcomm and Huawei are the largest. Ericsson and Nokia are smaller competitors in this space. There are a few more, but not many.
Apple is entering the chip set sector with their new MacBook Air and MacBook Pro using their own chips.
AT&T, Verizon, T-Mobile are national 5G wireless networks
Wireless networks are another rapidly growing sector in the 5G race. In the United States, there are many competitors, but there are really only 3 major wireless networks. They are AT&T Mobility, Verizon Wireless and T-Mobile US.
Dish Network was supposed to be the next, fourth largest mobile phone company after the T-Mobile, Sprint merger. However, we aren’t seeing anything yet.
Other smaller competitors, who are considered MVNO resellers, use one of more of these three networks.
These three are rapidly upgrading their network, one cell tower at a time and bringing 5G to an ever-expanding radius and number of users.
These are very important and growth companies.
KORE Wireless, US Cellular, C-Spire Wireless are 5G wireless players
There are many other, smaller wireless networks around the USA as well. Think US Cellular, C-Spire, and many other smaller firms. They operate their own networks, but also are a reseller of larger networks to provide nationwide service.
Many smaller wireless carriers are having a rough time making the larger investment to upgrade their networks to 5G. I expect to see weakness in this sector, and many may be acquired by larger carriers if they can bring customers or strengthen their network in weak spots.
There is also a sector of companies who provide other companies with large numbers of handsets to give out to their people. This is a strong sector who manage all this and resell one of the larger wireless carrier services.
These are companies like KORE Wireless who specialize in machine to machine and internet of things solutions.
Plus, there are many companies without well-known brand names which are very important to 5G.
HBO Max, Peacock, Apple TV+, Disney+ streaming TV services
Plus, as I mentioned earlier, 5G is the generation of wireless which is not only going to transform the wireless industry, but every other industry, company and government, worldwide.
One example is Streaming TV services like HBO Max, Apple TV+, Peacock and Disney+ are new and should be rapidly growing.
In fact, we may see change in how Hollywood works with these streaming services. Let me explain.
AT&T acquired Time Warner. That is now called WarnerMedia. That includes Warner Brothers, Warner Brothers Studios, CNN and much more.
WarnerMedia recently introduced one of the four new streaming services called HBO Max several months ago.
Problem: the entertainment industry meaning Hollywood and movie theaters have been impacted by Coronavirus with closures and limited attendance.
So, AT&T has decided to try something new. Going forward they will release 2021 movies both at the theaters and on HBO Max. Wonder Woman 1984 is a current example which just rolled out.
WarnerMedia may change Hollywood
This solves the immediate coronavirus problem companies and the industry face. It will let more users watch and it will take advantage of their entry into the movie business with their HBO Max service.
If successful, this move will put increasing pressure on Hollywood and the entertainment business to move in the same direction.
In fact, when AT&T acquired the assets which are now WarnerMedia, this is exactly what we can expect going forward.
So, using HBO Max for new movies along with theaters is a brand-new idea brought to us by new thinking. And this is just the beginning.
The growth curve is where growth companies can be found
So, keep your eyes on the 5G wireless space. It will remain a fast-growing space. That means there is real growth potential. However, that does not mean every stock will be a winner.
Remember the growth curve. It rises, crests and falls. The question you must ask yourself is this. Where on the growth curve is the company you are considering investing in, working for or being a customer of?
Is it on the rising side, is it cresting or is it falling? You want to find the companies on the growing side of the growth curve.
While some companies on the falling side of the growth curve can turn around, it is less likely.
One of the success stories was T-Mobile. They were literally dying several years ago. They missed the change from 2G to 3G. Then they brought in a new CEO who turned the company around. This is very difficult, but they did it.
MWC 2021 and CES 2021 are two important trade shows
In today’s world of 5G wireless, it’s easy to find plenty of companies on the growth side of the growth curve. Especially since some companies will struggle with the investment required to reach 5G.
CES 2021 was very different this year. I expect MWC 2021 will be the same. This is the first year caught in the pandemic mindset for CES and the second year for MWC. Hopefully things will be better for CES 2022 and MWC 2022.
As you can see, this sector is rapidly growing and changing on its own. Coronavirus has not slowed down the advancement of 5G wireless one bit here in the United States or around the globe. However, it does have an impact on certain companies and certain ways we do things.
While wireless is still a rapidly growing sector, you still need to judge each company on its own merits. There will be winners and losers, as there always are.
Finding the right and growing technologies and companies within that space to invest in is always the key.
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