Warren Buffett is clearly bullish on the long-term impact of 5G in America. And the CEO of one of his investments in the space says that makes a ton of sense.
“He [Buffett] sees the value of this sector,” T-Mobile CEO Mike Sievert told Yahoo Finance Live. “And again, that’s something we’ve all seen in these [investor] presentations this week — AT&T, Verizon and T-Mobile all came out with business plans that are very compelling, valuable and cash flow generating and this sector is valuable.”
Buffett, the fifth wealthiest person in the world, unveiled new positions in Verizon, Chevron, Marsh & McLennan and EW Scripps in the fourth quarter of 2020, according to a recent 13-F filing with the SEC. Verizon is one of the larger new bets by the Oracle of Omaha. Buffett scooped up 147 million Verizon shares now valued at about $8.22 billion. (Verizon is the parent company of Yahoo Finance.)
The investment in Verizon is in addition to Buffett upping his stake in Sievert’s T-Mobile. Buffett now owns 5.2 million shares of T-Mobile valued at $656 million. He initiated the position in T-Mobile in the third quarter of 2020, disclosing 2.4 million shares, then valued at $276 million.
Both recent positions come as the two telecom giants — along with AT&T — continue to duke it out for high-speed 5G positioning among smartphone subscribers. The battle was kicked up several gears this week, as the telecom trio came out with bullish long-term forecasts following a closely-watched C-Band spectrum auction.
Former Cisco CEO John Chambers says Buffett is on the mark with the likely bet on the future impact of 5G technology. “5G is part of the bigger movement of the internet of things and digitization as everything moves to edge [computing],” Chambers, who now leads his VC firm JC2 Ventures, explained on Yahoo Finance Live.
That bullishness is supported by various projections on 5G’s impact.
“Fast, intelligent internet connectivity enabled by 5G technology is expected to create approximately $3.6 trillion in economic output and 22.3 million jobs by 2035 in the global 5G value chain alone,”wrote researchers at the World Economic Forum. “This will translate into global economic value across industries of $13.2 trillion, with manufacturing representing over a third of that output; information and communications, wholesale and retail, public services and construction will account for another third combined.”
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