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Highlights
- 5G technology has been grabbing the attention of not just curious users and tech enthusiasts, but also of investors planning for the long haul.
- 5G, as the name indicates, is the ‘fifth generation’ technology of wireless networking.
- The newest wireless technology was deployed in Canada in 2020 by telecom giant Rogers Communications (TSX:RCI.B).
5G technology has been grabbing the attention of not just curious users and tech enthusiasts, but also of investors planning for the long haul.
This is not a complicated argument to understand. 5G technology is expected to be a rage among internet users in the coming days, considering its wireless connectivity will be leaps and bounds ahead of its previous generations.
As individuals, companies and governments alike become more dependent on technology, the demand of internet usage will also zoom, which will likely boost the popularity of 5G connectivity and companies engages in its development.
So, if you are an investor looking to brush your knowledge on 5G technology and such stocks, here’s what you need to know.
Also read: How can Canadian investors buy penny stocks?
What is 5G technology?
5G, as the name indicates, is the ‘fifth generation’ technology of wireless networking. A successor to the widely used 4G network, 5G was first introduced by Verizon Communications Inc in United States’ Chicago and Minneapolis in April 2019.
What sets 5G apart from its older generations is its extremely low response time (or latency) of about a millisecond, and high download speed, which is said to be 100 times quicker than 4G.
5G in Canada
The newest wireless technology was first deployed in Canada in 2020 by telecom giant Rogers Communications (TSX:RCI).
The trend was quickly followed by major telecom players in the country, including BCE Inc (TSX:BCE), Telus Corp (TSX:T), Quebecor (TSX:QBR), etc.
The Canadian government is also looking into 5G technology via its key advanced telecom research arm, Communications Research Centre (CRC). The CRC is said to be working on making 5G accessible to Canadians.
However, there have been some hindrances in terms of 5G development in Canada. Most recently, in November 2021, the Department of Innovation, Science and Economic Development (ISED) moved to limit certain 5G services as they were likely to affect with radio altimeters.
How to invest in 5G stocks in Canada?
While the most common way to invest in 5G stocks would be to explore telecom companies that provide 5G connectivity, there are other important players in the game one can look at as well.
For instance, there are an assortment of equipment that go into developing a 5G network, such as hardware parts, semiconductors, etc. Then, there is the infrastructure, i.e., the data centres, the network towers, etc.
Not to forget, the makers of the cell phones and other gadgets, without which you cannot exactly use the 5G network, are also key players of the 5G space.
Therefore, Canadian investors interested in exploring the realm of 5G technology for stock investment can peruse through a wide range of options.
Also read: 5 Canadian multibagger stocks of 2021
Bottomline
A report published by GSMA Intelligence in November 2020 estimated that the 5G space is likely to bring an additional value of US$ 150 billion to Canada’s gross domestic product (GDP) between 2020 and 2040.
Market research firm International Data Corporation (IDC), however, projected in an April 2021 study that 5G may not be a new revenue source for Canadian operators for much of 2022 as the space is still mostly under-development.
