mobile technology

Mobile Technology

Mobile technology is an integral part of our lives. Picture it: you get up, check your messages/emails, check-up people you love and work with, catch up on the news and other developments, and do much more on your mobile phone. And these are just some basic things people do on their phones, laptops, and other mobile devices.

Mobile technology’s key components include general packet radio service (GPRS), short message service (SMS), multimedia messaging service (MMS), global positioning service (GPS), and WAP, among others.

[Invest in 5G: What every investor needs to know.]

But “mobile” is a broad term. It essentially covers all hand-held mobile devices: mobile phones, laptops, tablets, smartwatches, and virtually any mobile device that can communicate with other devices.

Mobile technology, as mentioned, is shaping many aspects of human life: how we communicate, work, and live! The concept was mostly theoretical about three decades ago, but we now live in an age where our lives are heavily dependent on this technology.

Why Invest in Mobile Technology?

According to Morgan Stanley there have been four major computing cycles thus far: mainframe computers in the 60s, minicomputers in the 70s, personal computers (PCs) in the 90s, and desktop internet in the 2000s.

One eye-catching finding of this study is each of the subsequent computing cycles grew by a successive, continuous rate of 10X – the minicomputer cycle grew to ten times the size of the mainframe cycle and so on. The world is past the desktop internet cycle, and all focus now is on mobile technology.

The mobile technology cycle is expected to experience a boom ten times bigger than the desktop boom experienced in the 2000s – this is immeasurable, considering how big the 2000s boom was. The desktop cycle, however, was not as versatile and entrenched as the mobile technology cycle is. As such, we will likely see exponential growth as the world becomes more and more digitized.

Internet & Smartphone Penetration: There are about 14 billion mobile devices in use around the world today, according to Statista. 5.28 billion of these devices are in people’s hands, which accounts for about 68% of the world’s population.

Over half of the world’s population (about 3.5 people) is active online. 80% of internet users (about 2.8 billion people) own at least one smartphone – a sizeable fraction of this population owns more than one smartphone, which is especially well documented across Asia.

Internet penetration by mobile phone was about 48% in 2014. It grew to 61.2% in 2018 and reached 63.4% in 2019. It is estimated that mobile phone user internet penetration will be over 80% by 2022. The average mobile internet user spends about 3 hours online per day.

Smartphones are driving mobile technology. Their small size makes them convenient and hence more preferable to laptops and other larger devices.

Smartphone manufacturers have been recording increases in the number of devices they make, and this trend is expected to continue for the foreseeable future. Apple, which is one of the largest smartphone makers, sold more than 210 million iPhones in 2016 alone. It is now the first trillion-dollar company in the world, and it still plays second to Samsung.  

The world aims to achieve close to 100% internet penetration in the coming decades. The internet is also expected to grow larger and more dynamic over the coming decades. 

Currently, about 1.56 billion smartphones are sold to end-users annually. This number has been growing steadily over the past two decades, and it is expected to grow exponentially as the smartphone market expands.   

Cloud Computing: The cloud has proven invaluable in more ways than one. Most notably, it is one of the few avenues left for businesses and people to use following the outbreak of the COVID-19 pandemic.

The global cloud computing market is currently worth about $236 billion, up from $87 billion five years ago. The market is expected to grow to about $623 by 2023, which would signify a CAGR of 18%. Its uses are also expected to expand over time, and they will overlap with the new opportunities brought about by 5G technology.  

5G Networking: The mobile technology revolution is just beginning. It promises great things, such as Artificial Intelligence (AI) and Internet of Things (IoT) – IoT will also contribute to an exponential growth of mobile technology as it will connect virtually everything to the internet. 5G networking has emerged as the answer to bringing these innovative technologies to fruition.

5G technology is expected to be more than 100 times faster than the current 4G technology – to put this into perspective, 5G supports download speeds of up to 1.4GB per second. This will revolutionize technology across industries such as education and healthcare. For instance, hospitals will transmit large MRI files instantly, and surgeons can perform surgeries in virtual presence from anywhere in the world.  

Mobile technology will help shape the future of mankind. Billions of people around the world are already dependent on mobile technology for their day-to-day living, and billions more are catching up. Soon, it will become necessary to join the grid just to keep up with the human race.

How to Invest in Mobile Technology

However, like many types of new technology, investing in mobile technology does come with potential risks. mInvesting in the sector via an ETF or mutual fund, however, is a good way to counter these risks while still gaining exposure to this high-potential segment. A search on Magnifi indicates there are a number of ways for investors to access mobile tech this way.

Magnifi is changing the way we shop for investments, with the world’s first semantic search engine for finance that helps users discover, compare and buy investment products such as ETFs, mutual funds and stocks. Try it for yourself today. 

This blog is sponsored by Magnifi. The information and data are as of the publish date unless otherwise noted and subject to change. This material is provided for informational purposes only and should not be construed as individualized investment advice or an offer or solicitation to buy or sell securities tailored to your needs. This information covers investment and market activity, industry or sector trends, or other broad-based economic or market conditions and should not be construed as investment research or advice. Investors are urged to consult with their financial advisors before buying or selling any securities. Although certain information has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness. Past performance is no guarantee of future results. This content may not be reproduced or distributed to any person in whole or in part without the prior written consent of Magnifi. [As a technology company, Magnifi provides access to tools and will be compensated for providing such access. Magnifi does not provide broker-dealer, custodian, investment advice or related investment services.]


telecommunications 5G

5G

Although 5G appears to be a relatively new trend, it has been in the works for much of the last decade. This new type of internet access, which is anticipated to potentially replace in-home WiFi in the near future, is beginning to emerge among a few select carriers. Verizon, T-Mobile, and other popular carriers are making it easy for their current customers to transition from 4G LTE to 5G mobile internet, which is a stepping stone for applying the technology to other Wi-Fi-enabled devices in the future. 

[5G is Just Part of it. Invest in Mobile Technology as a Whole.]

But investing in 5G while the concept is still relatively new, you can gain an edge over the competition by being one of the first to support an up-and-coming service that is likely to have a strong impact on the future of mobile internet.

What is 5G?

Although some people may simply think of 5G as a replacement for WiFi, the overall potential of the technology is much more complex. First and foremost, 5G is beginning to replace the 4G LTE connection that most cell phone carriers currently use to provide internet access when a reliable WiFi connection is not available. 4G, which came out approximately a decade ago, was a modern replacement for the primitive 3G and 2G mobile internet of early cell phones. Each version made new features possible, increased the speed and capability of cellular data, and boosted the range at which cell phones could get a reliable signal. Like previous upgrades, the widespread release of 5G technology is expected to increase our ability to immediately access the information we need from anywhere in the world. 

[What will 5G mean for the future of video streaming?]

5G coverage is divided into three groups: low-band spectrum, mid-band spectrum, and high-band spectrum. High-band spectrum, which is the classification that most major carriers are currently focusing on, generally provides the strongest and fastest signals. However, this type of spectrum has a much more difficult time reaching through buildings than low-band and mid-band spectrum. For this reason, it is important to carefully consider the pros and cons of each type of spectrum to get an idea of which is likely to be the most successful in your area before choosing one to purchase or invest in. 

Why invest in 5G

Although the 2020 5G market is expected to be in the range of $5 billion, 5G technology is anticipated to grow exponentially over the next five years, reaching over $650 billion by 2026

The reason for this is the fact that widespread 5G coverage has not yet replaced 4G LTE and WiFi, in part because of regulatory hurdles and delays. Once those issues are resolved, it is expected that 5G adoption will take off nationwide, but it’s still not clear what that timeline will look like and how soon all of this will happen. Still, that explosive potential is why this up-and-coming form of mobile internet is an important area for investors that are interested in the latest technology to keep their eyes on.

After all, like many emerging industries, 5G technology is being pioneered by a handful of standout companies, both large incumbents and fast-growing startups. And it’s still early in this cycle. Investors who get in on 5G now will have far more upside to ride up than those that wait until the technology is fully rolled out and in broad use.

How to invest in 5G 

However, like many types of new technology, investing in 5G does come with potential risks. Although 4G, WiFi, Bluetooth, and other older signals have been studied in-depth as far as both immediate and long-term safety, not as much is currently known about the impact of long-term exposure to 5G’s electromagnetic fields. What’s more, it’s not yet clear how soon the national 5G roll-out will actually happen nor which companies will take the lead. 

Investing in the sector via an ETF or mutual fund, however, is a good way to counter these risks while still gaining exposure to this high-potential segment. A search on Magnifi indicates there are a number of ways for investors to access 5G this way.

Magnifi is changing the way we shop for investments, with the world’s first semantic search engine for finance that helps users discover, compare and buy investment products such as ETFs, mutual funds and stocks. Try it for yourself today. 

This blog is sponsored by Magnifi. The information and data are as of the publish date unless otherwise noted and subject to change. This material is provided for informational purposes only and should not be construed as individualized investment advice or an offer or solicitation to buy or sell securities tailored to your needs. This information covers investment and market activity, industry or sector trends, or other broad-based economic or market conditions and should not be construed as investment research or advice. Investors are urged to consult with their financial advisors before buying or selling any securities. Although certain information has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness. Past performance is no guarantee of future results. This content may not be reproduced or distributed to any person in whole or in part without the prior written consent of Magnifi. [As a technology company, Magnifi provides access to tools and will be compensated for providing such access. Magnifi does not provide broker-dealer, custodian, investment advice or related investment services.]


gaming

Video Games

If the image that comes to mind when someone mentions video games is a teenage boy sitting in their parent’s darkened basement playing Mario Kart, surrounded by discarded Mountain Dew cans and Doritos bags, then it is time to discard this outdated stereotype.

Whether or not you yourself enjoy playing video games in your leisure time, gaming has evolved considerably and expanded well beyond its niche origins to sit squarely in the entertainment and cultural mainstream. Fortnite, you may recall, became a global cultural phenomenon following its 2017 release, with everyone from World Cup soccer players to Michelle Obama getting in on the dances popularized by the game.

The demographics of gaming are rapidly evolving with this expansion into the cultural mainstream. In a recent study by AARP, the percentage of adults age 50-59 who play video games at least once a month increased from 38% in 2016 to 44% in 2019, with women more likely than men to regularly play.

Gaming’s explosion in popularity is due, at least in part, to transformative changes in the video game industry over the past decade.

Ten years ago, if you wanted to play the latest game, you would go to a local store (GameStop, for instance), buy the game for around $60, and take the discs home to install/play. These days, mobile gaming (primarily on smartphones) accounts for the largest share of total gaming revenue worldwide, and popular games are often free to download and play. Developers monetize these free games by offering players in-game purchases.

Another relatively recent development is the rise of subscription gaming, which offers players access to a multitude of games for a monthly subscription fee. Similar to the “streaming wars” between Netflix, Amazon, Hulu, etc., developers are scrambling to build competitive subscription services as they work to attract larger shares of the growing market.

For those interested in the investment potential of this dynamic market, there are a few important points to understand.

What are video games circa 2020?

The Cambridge Dictionary defines a video game as “a game in which the player controls moving pictures on a television screen by pressing buttons or moving a short handle.”

Video games have been around in one form or another for decades, beginning with arcade gaming in the 1970s and transitioning to home gaming in the late 70s and early 80s with popular titles such as Space Invaders, Frogger, and PacMan.

Gaming today largely falls into three distinct categories: console gaming, personal computer (PC) gaming, and mobile gaming. Console gaming happens on devices that are built exclusively to play video games (think PlayStation, Xbox, etc.), while PC gaming happens on high-performance personal computers, and mobile gaming, as the name implies, happens on your mobile device (such as your smartphone or tablet).

Until relatively recently, console and PC gaming were the dominant forces in the video game industry, but the recent explosion of smartphone use and internet connectivity globally has dramatically reshaped the industry.

According to market research firm Newzoo, mobile gaming is currently the fastest-growing segment in the video game industry, and revenues from mobile gaming account for 46% of the total gaming market in 2019. This isn’t to say that dedicated gamers are ditching their consoles and PCs in favor of games on their smartphones; rather, the market is expanding as more people gain access to free or inexpensive games through their mobile devices.

This expansion and diversification of the gaming ecosystem have given rise to novel revenue streams; most notably, live streaming and esports.

Live streaming involves gamers broadcasting themselves playing video games live on the internet. The practice has become wildly popular, as evidenced by Amazon’s 2014 acquisition of the streaming startup Twitch for $1 billion.

Esports, meanwhile, refers to competitive, organized video gaming. You may recall the story about the 16-year-old who went home with $3 million after winning the 2019 Fortnite World Cup.

Global revenues from the burgeoning esports market exceeded $1 billion in 2019, an increase of 26.7% over 2018 revenues. The emergence of live streaming and esports has fueled greater interest in gaming while offering outside investors a new way to reach this diverse group of consumers.

Why invest in video games?

According to Newzoo’s 2019 Global Games Market Report, there are more than 2.5 billion people globally who play video games, and global revenue from gaming reached $148.8 billion in 2019. The U.S. market alone generated about $35.5 billion in 2019.

As a point of comparison, the 2019 global box office for films reached a record $42.5 billion, and the U.S. box office finished with $11.4 billion. This means that in 2019, people spent more than three times as much on video games as they did on seeing movies.

This remarkable performance comes amid a changing revenue landscape in which console and PC gaming account for less and less consumer spending.

Mobile gaming comprised about 46% ($68.2 billion) of overall market revenue in 2019 – an increase of 9.7% over 2018 revenues. Though smaller than mobile, console gaming continues to see healthy growth, occupying 30% of the market ($45.3 billion) with an increase of 7.3% from 2018.

Newzoo forecasts that video game revenues will grow to $196 billion by 2022 at an annual growth rate of 9%. Mobile gaming will continue to grow over the next several years, increasing from 46% of the total market in 2019 to a forecasted 49% by 2020 ($68.2 billion to $95.4 billion).

Mobile gaming’s expansion in the market may even be accelerated by outside factors, including the rollout of 5G networks (faster connectivity means better gameplay in more places) and further advancement of augmented/virtual reality (think Pokémon GO).

The video game market offers a unique investment opportunity because the industry is projected to continue its extraordinary performance in the coming years, and the various segments offer a wide variety of options when it comes to risk vs. return.

How to invest in video games

However, despite their popularity and long-standing growth, investing directly in the video gaming sector can be challenging. There are hundreds of different companies working on individual gaming properties, and the rise of mobile gaming has introduced new players to the sector, such as mobile providers and hardware manufacturers. However, a search on Magnifi suggests that there are a number of other ways to profit from the growth of video games as a whole.

Magnifi is changing the way we shop for investments, with the world’s first semantic search engine for finance that helps users discover, compare and buy investment products such as ETFs, mutual funds and stocks. Try it for yourself today.

This blog is sponsored by Magnifi. The information and data are as of the publish date unless otherwise noted and subject to change. This material is provided for informational purposes only and should not be construed as individualized investment advice or an offer or solicitation to buy or sell securities tailored to your needs. This information covers investment and market activity, industry or sector trends, or other broad-based economic or market conditions and should not be construed as investment research or advice. Investors are urged to consult with their financial advisors before buying or selling any securities. Although certain information has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness. Past performance is no guarantee of future results. This content may not be reproduced or distributed to any person in whole or in part without the prior written consent of Magnifi. [As a technology company, Magnifi provides access to tools and will be compensated for providing such access. Magnifi does not provide broker-dealer, custodian, investment advice or related investment services.]


Mobile Payments

When is the last time you wrote a check to pay for something or left the house with a set amount of cash in your wallet for errands? For a growing number of people worldwide, it is entirely possible that they may not be able to recall. In the U.S., the use of credit and debit cards have largely replaced the use of checks, and carrying cash is increasingly seen as unnecessary and inconvenient. This dramatic transformation of our payment practices can be explained in part by the emergence of mobile payment technology for smartphones in recent years.

The rise of mobile payments has transformed the way we pay for everyday items and simplified how we share money with one another.

With smartphones in almost everyone’s pockets and apps that transfer money digitally in seconds, the days of frantically searching for an ATM or cursing yourself for leaving your wallet at home are coming to an end. Who needs a checkbook when you can quickly transfer your friend that $25 you owe them with a few taps on your smartphone? 

What are Mobile Payments?

According to Square, a leading mobile payment technology company, mobile payments are defined as “regulated transactions that take place digitally through your mobile device.” 

Most mobile payments are conducted through a mobile wallet or mobile money transfer. A mobile wallet is a smartphone app that securely stores credit or debit card information. This information can be digitally communicated to a business’s point-of-sale system by holding the smartphone near the business’s payment reader.

Popular mobile wallet apps include Apple Pay, Samsung Pay, and Android Pay, and companies that provide businesses with software and devices to accept mobile payments include Square, SumUp, and PayPal.

In the case of mobile money transfers (also sometimes referred to as “peer-to-peer” or “P2P” payments), funds are transferred between users on an app. Typically, a user creates an account on the app, links their bank account, debit card, and/or credit card information with the app, and “adds” accounts of other individuals who use the app. Money may then be requested from or sent to the accounts of these individuals.

Popular money transfer apps include Venmo, WorldRemit, and Azimo.

Mobile payment companies monetize the services they offer in a variety of ways. Square, for instance, charges businesses a fee ranging from 2.5% to 3.5% for each transaction (with a flat fee of 10 cents added to each transaction fee). Venmo, on the other hand, charges its users a 3% fee for sending money via credit card instead of debit card. Both companies offer expedited access to transferred funds for a fee. Since its November 2015 IPO, the stock price for Square has risen from about $8 per share to about $65 per share (as of November 2019). Since its July 2015 spinoff from eBay, the stock price for PayPal (Venmo’s parent company) has risen from about $40 per share to about $103 per share (as of November 2019).

A Fast Growing Market

According to a 2018 report by GSMA, 143 million new mobile payment accounts were opened worldwide in 2018, bringing the total number of accounts to 866 million. Approximately $1.30 billion was processed every day via mobile payment in 2018, and a typical active user moved an average of $206 per month.

The speed, efficiency, and security offered by mobile payments help explain why this technology has become so popular across the globe. The rise in this technology is also providing people who have traditionally been excluded from formal banking systems with access to life-changing financial services.

According to the World Bank, “Financial inclusion is a building block for both poverty reduction and opportunities for economic growth, with access to digital financial services critical for joining the new digital economy.”

Why Invest in Mobile Payments?

For those interested in investing in this rapidly-growing sector, however, there are a few important points to understand.

The mobile payment companies mentioned thus far are undeniably successful. Square’s total net revenue in the third quarter of 2019 was $1.27 billion, which is a 44% increase over 2018’s third quarter earnings. PayPal’s total net revenue for the same quarter was $4.38 billion, with Venmo accounting for $400 million (double the $200 million from the third quarter in 2018). With steady growth and a seemingly-unlimited appetite for disrupting the value of traditional financial institutions, there has never been a better time to consider investing in companies offering mobile payment solutions.

While Square and Venmo may be the first that come to mind with respect to mobile payments in the U.S., there are many other companies that have arisen in recent years in other parts of the world that are just as innovative and, in terms of active users, arguably more successful. Whether it’s WeChat Pay in China, Paytm in India, or M-PESA in Kenya, entrepreneurs across the globe have known about the transformative potential of mobile payments for years.

The acceptance of mobile payments as a trusted and valued financial tool has occurred at a faster rate and to greater effect in the developing world than in the U.S. For instance, an eMarketer report found that in 2019, approximately 80% of smartphone users in China regularly use mobile payments, while only about 30% of smartphone users in the U.S. regularly make mobile payments.

It may seem as if there would be no room for growth with 80% of users currently accounted for in China’s market, but it is important to note that the 20% of smartphone users not regularly making mobile payments represent about 135 million people.

Not to mention, the 70% of smartphone users in the U.S. not regularly making mobile payments represent about 138 million people. Smartphone users in the U.S. have been slow to adopt mobile payments en masse, due in part to a widespread perceived risk regarding the security of digitally-transferred funds. As the population in the U.S. ages and more accurate information about the security and convenience of mobile payments filters out, it is likely that a much higher percentage of the population will adopt the technology.

In the meantime, companies at the cutting edge of mobile payment innovation will continue to reimagine and redefine how we think about our finances.

How to Invest in Mobile Payments

A search on Magnifi suggests that there are a number of different ways for investors to get involved in the fast growing Mobile Payments sector.

Magnifi is changing the way we shop for investments, with the world’s first semantic search engine for finance that helps users discover, compare and buy investment products such as ETFs, mutual funds and stocks. Try it for yourself today.

This blog is sponsored by Magnifi. The information and data are as of the publish date unless otherwise noted and subject to change. This material is provided for informational purposes only and should not be construed as individualized investment advice or an offer or solicitation to buy or sell securities tailored to your needs. This information covers investment and market activity, industry or sector trends, or other broad-based economic or market conditions and should not be construed as investment research or advice. Investors are urged to consult with their financial advisors before buying or selling any securities. Although certain information has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness. Past performance is no guarantee of future results. This content may not be reproduced or distributed to any person in whole or in part without the prior written consent of Magnifi. [As a technology company, Magnifi provides access to tools and will be compensated for providing such access. Magnifi does not provide broker-dealer, custodian, investment advice or related investment services.]