T-Mobile US, Inc. (TMUS - Free Report) and Nokia Corporation (NOK - Free Report) jointly announced that they have successfully completed the nation’s first bi-directional 5G data transmission session, on a 5G New Radio (NR) system abiding by 3GPP standards. This accomplishment is a major step in paving the way for incorporating 5G technologies, which will be available on smartphones next year.
A user equipment simulator and Nokia’s 3GPP-compliant high-capacity 5G solution in the 28 GHz band were used to conduct the data transmission test in T-Mobile’s lab in Bellevue, WA. The 5G solution includes the Nokia AirScale baseband and radio, AirFrame server, and AirScale Cloud RAN running 5G NR 3GPP-compliant software, all of which have been validated by T-Mobile’s lab and field trials. The most notable trial conducted by T-Mobile is the set-up of its first inter-vendor 5G test platform.
In this context, it is important to discuss what 5G NR and 3GPP is. 5G NR is a new air interface developed for 5G networks to support 5G related services, devices and deployments. The 3GPP or 3rd Generation Partnership Project is a collaborative project of several telecommunications standard development organizations to develop and maintain various aspects of the telecom sector, including next generation and related 5G standards. The 3GPP protects the smooth functioning of all 5G related activities, as the industry transitions toward 5G.
5G is set to be the future of the wireless market, assuring customers of faster data speed, strong connectivity and a reliable network. It also promises decade long sensor battery life compared to a year-long battery life of second generation sensors. All these are critical to meet the growing demand for virtual and augmented reality experiences. The always-available, low latency connectivity of 5G networks will also pave the way for advanced technological innovations like driverless vehicles, advanced industrial automation services, medical monitoring and like.
What This Means for T-Mobile
Driven by strategic branding efforts, attractive pricing and offerings, T-Mobile has been among the fastest growing companies in the U.S. wireless market in the past four years. However, strong competition is likely to slow down its growth in the coming months. As the industry prepares for 5G, a major drawback for the company is the comparatively weaker millimeter-band spectrum and its limited efforts on mobile 5G. With Nokia aggressively taking up the mobile 5G deployment mission, this collaboration can propel the company forward in the wireless market.
In the past six months, T-Mobile has underperformed the industry’s decline of 7.3% with a loss of 8.3% on an average, whereas Nokia has impressively outperformed the industry’s growth of 5.5% with average return of 27.5% in the same period.
Zacks Rank and Stocks to Consider
T-Mobile and Nokia currently carry a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry space are BlackBerry Limited (BB - Free Report) sporting a Zacks Rank #1 (Strong Buy), and Motorola Solutions, Inc. (MSI - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
BlackBerry has an expected long-term earnings growth rate of 18.6%.
Motorola has an expected long-term earnings growth rate of 8%.
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