Verizon just bought a booster for its 5G future.
The telecommunications giant will pay about $3.1 billion in an all-stock deal to acquire Straight Path Communications, which holds a treasure trove of wireless licenses useable in future super-fast next-generation 5G mobile and fixed broadband services.
Straight Path, based in Glen Allen, Va., holds valuable spectrum licenses -- in the high-frequency bands of 28 gigahertz and 39 GHz -- for which devices and services are expected to be deployed over the next few years. These 5G services promise much faster speed than current wireless technology, as well as better connectivity and improved battery life. "Think of it as Wi-Fi on steroids," said Roger Entner, founder of Recon Analytics.
Beyond mobile service, 5G can supply improved wireless home broadband and connect a menagerie of connected devices, the deployment of which Intel expects to grow from 2 billion to 200 billion by 2020.
Telecom providers continue to joust in a race to secure spectrum for 5G delivery. T-Mobile recently spent nearly $8 billion, its largest investment ever, in the recent FCC auction as part of its 5G plans. Both AT&T and Verizon have announced 5G trials to begin later this year. Eventually, 5G wireless can delivery speeds beyond 1 Gigabit per second (current mobile networks typically deliver in the tens of megabits per second).
5G standards have not been finalized yet, "but this gives Verizon an early lead on this high-frequency spectrum," Entner said. "But we know there will be spectrum auctions coming in the next few years. This is the first mile of a marathon run."