AT&T, Ericsson & Qualcomm Join Forces to Conduct 5G Trial

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We received different updates on the next-gen 5G launch and its trials, throughout 2016. This year too calls for 5G trials and related specifications without much ado. To this end, according to a recent LightReading report, AT&T Inc. T , Ericsson ERIC and Qualcomm Inc. QCOM announced plans to test the initial 3GPP (3rd Generation Partnership Project) 5G New Radio (NR) specification in the second half of 2017.

The trio is planning to test high-band frequencies for the next-generation 5G technology, which should deliver "multi-gigabit Internet service" over the air. Such technical specifications will allow the downloading of a HD (high definition) film wirelessly to phone. The trial will see AT&T using 28GHz and 39GHz spectrum bands, Qualcomm providing prototype devices and Ericsson providing base station solutions.

Notably, the two spectrum bands to be commercially deployed here - 28GHz and 39GHz - have been assigned by the U.S. telecom regulator, Federal Communications Commission (FCC) for the said purpose.

In early Dec 2016, Telecom behemoth AT&T already initiated 5G technology trials in partnership with Ericsson using the millimeter wavelength technology. The trial was carried out in Intel Corp.'s INTC Austin office. AT&T has collaborated with Ericsson to conduct its first-ever 5G public demo. The test also featured online video streaming at 4K resolution and real time camera feeds. Going forward, AT&T and Ericsson will test 5G Voice over Inter Protocol (VoIP) services using 15 Giga-Hertz (GHz) and 28GHz spectrum bands.

Benefits of 5G

The next-gen 5G network will provide 50 times the throughput of the currently available standard 4G LTE network. Further, 5G technology is designed to be more power efficient than any other standard wireless networks available now available. Therefore, 5G-enabled mobile devices are likely to last longer than their 3G or 4G counterparts. Moreover, superfast 5G mobile networks will be of utmost importance for the management of the exponential growth in Internet-connected devices, popularly known as Internet of Things (IoT).

It is expected that 5G mobile handsets will be available in the market by 2020, following a broader rollout of the technology. The commercial 5G handsets will be first made available in South Korea and Japan and are likely to be very expensive.

Bottom Line

5G marks a revolution in the field of communications and technology. It is the next major phase of mobile telecommunications standards after the 4G/IMT standards. 5G NR is a specification being put together by the 3rd Generation Partnership Project (3GPP). The initial specification, due later in 2017, is NSA-NR (Non-Standalone-New Radio), which uses LTE for the call and session set-up. This marks an important move by AT&T as it is already working on deploying 5G at the earliest. In Jul 2016, Verizon Communications Inc. VZ became the first company in the world to issue an initial radio specification for the upcoming 5G wireless network. Verizon seems far ahead in its plans to deploy the 5G wireless network.

Price Performance

Shares of AT&T have underperformed the Zacks categorized Wireless National industry's performance in the past one year. The stock gained 23.65% while the industry's growth is higher at 25.41%.

AT&T is gradually diversifying its business model into Internet TV, the digital mobile platform and the highly lucrative mobile advertising segments. Although the telco has forayed into the OTT space through its DirecTV Now, it faces troubles such as a saturated wireless market, spectrum crunch, loss in access lines and union disagreements. Hence, the company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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