After President Donald Trump lost at the ballot box, many thought that other Western nations would revisit their bans on Huawei from their 5G networks.
Not least Huawei itself.
In mid-November, Huawei Vice President Victor Zhang told the Guardian newspaper that he hoped the United Kingdom would reset its relationship with his company. Zhang said keeping Huawei equipment out of the U.K. only increases that nation’s north-south divide and leaves it left behind in the 5G revolution.
No dice.
Early yesterday, the U.K. amped up its existing embargo on Huawei and other “high-risk” 5G equipment vendors. Now, U.K. telecom companies have only until next September to stop installing such equipment on their networks. Plus, they must rip out any existing equipment from high-risk vendors by 2027.
Moreover, according to The Washington Post, President-elect Joe Biden “is expected to maintain a hard line on most matters, including export restrictions to Huawei.” And he’ll likely do so with a lot more than tweets.
So, if you started betting on Huawei and other Chinese 5G equipment makers after Election Day, you may want to unwind that bet.
And start thinking about where to start putting your money instead.
Let’s figure out where in today’s issue …
On the Lookout for Huawei’s Replacement
While the United States has been keeping an eye on Huawei since 2012, the current movement really started building on early this summer, when President Trump designated the leading manufacturer of 5G equipment as backed by the Chinese military.
Then on June 30, the U.S. Federal Communications Commission officially named Huawei as a national security threat.
The Shenzhen-based company once had its sights on becoming the largest phone seller in the world, but Western nations have now almost entirely cut ties with the company.
The chief concern is that the company is tied to the Chinese government. Huawei founder Ren Zhengfei was a technician for the People’s Liberation Army before starting the company, and the Chinese government has invested billions in Huawei, which is one reason for its success.
Clearly, the United States doesn’t want Huawei involved with the construction of its communications networks — particularly its growing 5G networks.
And so, Western nations and companies have all started looking for other 5G technology suppliers.
And one non-Chinese company is emerging as a clear winner.
This Company Could Win a $13.2 Trillion Race
Consider these recent stories:
- In Canada, BCE and Telus announced that two Huawei alternatives would be their new 5G RAN vendors. Huawei had been the 4G LTE supplier to both telcos. Rogers Communications also selected one of these alternates for its 5G RAN networks.
- In Australia, Chinese suppliers have been banned from the market. As a result, Optus chose someone else as its 5G RAN vendor, with Telestra picking the same company.
- In Germany, Deutsche Telekom jumped on the bandwagon on July 22, when it selected this company to build its 5G network. This announcement is a particularly telling sign of the times, as Huawei was Deutsche Telekom’s 3G and 4G supplier and was initially expected to build 70% of its 5G network.
The opportunity for this company is vast and growing. According to Grand View Research, the global 5G infrastructure market could absolutely explode in size to nearly half a trillion dollars by 2027.
That level of spending would represent a staggering compound growth rate of 106% per year between now and then.
All that means this company is in the right place at the right time … with the right products.
- It is a 5G powerhouse that provides a broad range of 5G hardware, solutions, and services.
- It can provide both end-to-end and partial solutions, and it can customize those solutions based on existing infrastructure and network capabilities.
- And its top competitors have been banned from the United States and much of the rest of the world.
That’s why I expect this company to become a very profitable, and potentially explosive, long-term winner.
After all, the 5G telecommunications sector is going to lay the ground for a whole host of new technologies, meaning it will be very valuable.
5G alone is set to create more than $12 trillion in new wealth over the next few years. Qualcomm estimates that 5G will create a whopping $13.2 trillion in global sales activity by 2035. The technologies 5G will enable also measure their future growth prospects in the trillions of dollars.
It is powering the future of the tech economy … expecting investments from an overwhelming majority of the world’s companies … and instilling fear of falling behind in some firms.
In other words, 5G is perhaps the main driver behind the widening of the Technochasm.
So, it won’t surprise you to know that the three “1,000% and Beyond” stocks I put in a recent report are all connected to the 5G boom — including the one company that I said above “is emerging as a clear winner.”
I’ve put together a special strategy for trading these three stocks … one that can accelerate your wealth-building process and consistently produce life-alerting gains.
On the date of publication, Eric Fry did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Eric Fry is an award-winning stock picker with numerous “10-bagger” calls — in good markets AND bad. How? By finding potent global megatrends … before they take off. And when it comes to bear markets, you’ll want to have his “blueprint” in hand before stocks go south.
