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Specialist in Japanese equities, Kheiron Group

Nathan Ramler, CFA

Specialist in Japanese equities

Kheiron Group

Tokyo-based with experience in global equity markets and M&A. Striving to add value and insight. 

Specialists in Japan

Thematic (Sector/Industry)

Japan Telecom services / Thematic (Sector/Industry)

5G sounds great, right? – faster speeds, more capacity, improved efficiency – but what does that really mean? The reality is that 5G isn’t needed for consumer services. In Japan, 4G and its improvements can be more than sufficient to deliver network speeds and capacity that give consumers a good experience. That doesn’t mean that 5G won’t improve consumers’ service experience, but we expect the main use cases for 5G to be industrial, not consumer. We do anticipate 5G in Japan will open up opportunities for new services and revenue streams.Japanese telco capex has been trending lower. <a href="https://www.smartkarma.com/entities/623" target="_blank" data-smartkarma-citation="entities:623:1">NTT (9432 JP)</a>, <a href="https://www.smartkarma.com/entities/1089" target="_blank" data-smartkarma-citation="entities:1089:1">NTT Docomo (9437 JP)</a>, <a href="https://www.smartkarma.com/entities/639" target="_blank" data-smartkarma-citation="entities:639:1">KDDI (9433 JP)</a>, <a href="https://www.smartkarma.com/entities/315" target="_blank" data-smartkarma-citation="entities:315:1">Softbank (9984 JP)</a>, and even <a href="https://www.smartkarma.com/entities/31" target="_blank" data-smartkarma-citation="entities:31:1">Rakuten (4755 JP)</a> are all investing in 5G, but telco cash flows are not waiting to be crushed by 5G spending because 5G can piggyback on existing infrastructure. The technology comes as a more gradual shift and is complementary to 4G technologies, so we do not expect 5G to result in material changes or pressures on absolute capex spending. Yes, there are some new technological elements needed in the networks and previous generational shifts of technology have not always been smooth, but we see no call to panic about 5G.In this insight we look at:<ol>
<li>The timeline for 5G and an explanation of what 5G is</li>
<li>Use cases for the technology and competitive threats to the network operators</li>
<li>A deep dive into the technology itself – if you want to know your MIMO from your NOMA, come join us as we let our inner geek run rampant</li>
</ol>

5G sounds great, right? – faster speeds, more capacity, improved efficiency – but what does that really mean? The reality is that 5G isn’t needed for consumer services. In Japan, 4G and its improvements can be more than sufficient to deliver network speeds and capacity that give consumers a good experience. That doesn’t mean that 5G won’t improve consumers’ service experience, but we expect the main use cases for 5G to be industrial, not consumer. We do anticipate 5G in Japan will open up opportunities for new services and revenue streams.Japanese telco capex has been trending lower. NTT (9432 JP), NTT Docomo (9437 JP), KDDI (9433 JP), Softbank (9984 JP), and even Rakuten (4755 JP) are all investing in 5G, but telco cash flows are not waiting to be crushed by 5G spending because 5G can piggyback on existing infrastructure. The technology comes as a more gradual shift and is complementary to 4G technologies, so we do not expect 5G to result in material changes or pressures on absolute capex spending. Yes, there are some new technological elements needed in the networks and previous generational shifts of technology have not always been smooth, but we see no call to panic about 5G.In this insight we look at:
The timeline for 5G and an explanation of what 5G is
Use cases for the technology and competitive threats to the network operators
A deep dive into the technology itself – if you want to know your MIMO from your NOMA, come join us as we let our inner geek run rampant


NTT (Nippon Telegraph & Telephone) (9432 JP)

5Gが到来 ― 慌てるな。ソフトバンク（9984 JP）、ドコモ（9437 JP）、KDDI（9433 JP）の賢いプラン