The fifth generation wireless technology or 5G is ready to take off and will be a game changer when it is fully implemented. There is a lot of excitement over the technology, given its transformative potential.
The International Telecommunication Union (ITU), a UN body, has a set of requirements for the technology. It should offer download speeds of at least 20 gigabits per second, response times or “latency” of less than 1 millisecond and the ability to connect at least 1 million devices in one square kilometer.
With much faster speeds, 5G could change the way we live, work, travel and communicate. The technology will provide a big boost to the Internet of Things, self-driving cars, and virtual/augmented reality technologies
Major telecom companies have just started rolling out 5G service in very limited areas. Verizon (VZ) enabled the service last month in parts of Chicago and Minneapolis. AT&T (T) has started 5G service trials in parts of 19 cities. Sprint (S) plans to launch the service in nine cities by the end of this quarter.
Samsung (KS:005930) (SSNLF) was among the first phone makers to introduce a 5G smartphone. Apple (AAPL) settled its multiyear legal dispute with Qualcomm (NASDAQ:QCOM) recently, so we could see a 5G iPhone next year.
The Defiance Next Gen Connectivity ETF (FIVG) is the first ETF focused exclusively on companies involved in research, development and usage of 5G technology. Its top holdings include CommScope (COMM) , Xilinx (NASDAQ:XLNX) (XLNX ) and Skyworks (NASDAQ:SWKS) (SWKS ) .
The First Trust Indxx NextG ETF (NXTG) changed its focus last month to track an index of companies involved in 5G and next-generation cellular technologies. AMD (AMD), Equinix (NASDAQ:EQIX) (EQIX) and Cisco (CSCO) are among its top holdings.
To learn more about these ETFs, please watch the short video above.
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