MENU

Optus to launch 5G next year

Optus has announced that it will launch its 5G network in 2019. This could be embarrassing for Telstra Corporation Ltd (ASX: TLS) if its competitor brings the next generation of telecommunications to the market before the Aussie giant.

5G is touted as being able to offer speeds that are 15 times quicker than the current 4G. According to Optus, it had managed to achieve speeds of up to two gigabits per second, which is around at least 20 times faster than what most people’s fastest NBN connection can achieve.

Many people have speculated that households will no longer need a fixed broadband connection if 5G offers the speeds and reliability they need. If households drop their $60 to $100 monthly fixed internet bill, they could afford a very big data plan on a 5G network.

Optus managing director of networks said “Everyone has heard of concepts like self-driving cars, smart homes, AI and virtual reality, however their full potential will require a fast and reliable network to deliver”.

Telstra will be hoping that it can achieve the same speeds and reliability, if not better, as Optus. Its future as Australia’s leading telecommunications company depends on it. If Telstra can generate strong revenue from self-driving cars and AI it could turn its fortunes around.

It will also be very interesting to see what happens with the second tier telecommunications businesses like Amaysim Australia Ltd (ASX: AYS). Optus and Telstra will have a lot of bargaining power as they are the ones building the 5G infrastructure.

Foolish takeaway

Profit margins will be key for Telstra after taking such a big hit from the NBN changes. 5G could be exactly what Telstra needs to turn things around, but management will need to get their skates on to beat Optus to the market.

The telecommunications world is still uncertain, that’s why I think it makes more sense to invest in winners like these hot stocks.

Top 3 ASX Blue Chips To Buy In 2018

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool’s in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool’s Top 3 Blue Chip Stocks for 2018."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies moves – we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.