Consumers likely won’t notice an improvement in their phones when using 5G models, Rod Hall, an analyst at Goldman Sachs, told CNBC on Tuesday.
“We call 5G a brand, not a feature,” said Hall, who covers Apple, in discussing fifth-generation wireless technology. “We don’t believe most consumers will notice a difference.”
The hype around 5G has picked up as more wireless carriers upgrade their infrastructure to provide faster internet speeds and to support connections of many more devices, such as cars, street lights and industrial equipment, to the cellular network.
Few phones currently support 5G, though several are working to get there. Ming-Chi Kuo, who covers Apple at TF Securities, agrees with Hall that the iPhone maker will release its own 5G-capable phones next year. However, Hall isn’t urging consumers to wait for the upgrade.
“The latency reductions in 5G are beyond anything a human can perceive; they’re really designed for machines,” Hall, who has a neutral rating on the stock, said on “Squawk on the Street.” “In terms of bandwidth, what you’ll experience in terms of speed isn’t going to change much. This is mainly a technology change.”
In September, Goldman downgraded its Apple price target to $165 from $187. Apple shares are up about 44% this year to $226.81 as of Tuesday afternoon.
The cut in price target comes as Apple is caught in the ongoing U.S.-China trade war. When asked if he thinks Chinese consumers will leave Apple to purchase Chinese brands, Hall said he doesn’t expect much of a change.
“That Apple brand is still very strong,” he said.
In terms of financial risks tied to the trade war, there are real concerns that Apple could face issues in China. Beijing is currently looking at an economic slowdown.
“It’s really about consumer demand and how strong the consumer is in China,” Hall said. “If they’re feeling worried about the economy, they’ll buy cheaper phones. And Apple’s not a cheap phone.”