Dear Reader,

Welcome to our weekly mailbag edition of The Bleeding Edge. All week, you submitted your questions about the biggest trends in technology. Today, I’ll do my best to answer them.

If you have a question you’d like answered next week, be sure you submit it right here.

But before we get to today’s questions, I wanted to let you know what was on my radar…

Yesterday, Apple released its iOS 13 operating system for smartphones. The release is timed with the availability of Apple’s new iPhone 11, which you can find today in Apple stores around the world.

This is important because some hints about Apple’s future product direction in regard to augmented reality technology are hidden within the software code of its iOS 13…

More to follow in Monday’s edition of The Bleeding Edge.

How to protect self-driving cars from hackers…

First up is a question on cybersecurity for autonomous vehicles…

There has been some concern about hacking into self-driving cars. Do you have any thoughts on this, Jeff?

– Roger D.

Hi, Roger. Not just self-driving cars but any modern car that has a wireless network connection in it is at risk for being hacked. And when I say “modern,” I mean any car that was manufactured in the last 20 years.

If a car is connected, the reality is that it is at risk of being hacked into. It has nothing at all to do with self-driving technology.

For example, in July 2015, two men hacked the controls of a driver’s Jeep Cherokee.

The two men gained remote access to the Jeep over Sprint’s wireless network. This enabled them to do pretty much whatever they wanted with the car.

The hackers seized control of the vehicle’s controller area network (CAN). The CAN is like the central nervous system of a car.

CAN transmits all the commands that control the engine, the brakes, the transmission, the airbags… even the steering.

The hackers soon took control of the transmission and shut it down. The Jeep was on a major highway, and it started decelerating to a slow crawl. There was no shoulder for the driver to escape to… The Jeep and its passenger were at the mercy of the cars and trucks zipping by.

Fortunately, the culprits worked for a vehicle security research division. They are the good guys, in other words. They wanted to demonstrate the vulnerabilities of the vehicle.

So being hacked isn’t a threat that’s unique to self-driving cars.

Surprisingly, cybersecurity for vehicles has been an underdeveloped area for many years. It just didn’t receive that much attention.

The world really lucked out, as nefarious actors could have caused untold disasters by taking advantage of this clear vulnerability.

However, in the last five years, there has been strong development of security solutions to protect vehicles from precisely these kinds of attacks.

One of the largest players is automotive supplier Aptiv in Michigan, which is also one of the most prominent players in the self-driving technology industry. Lyft has used Aptiv’s technology in Las Vegas, where it’s given more than 50,000 self-driving rides already.

Tel Aviv-based Argus Cyber Security is another standout in the industry. Argus is focused entirely on automotive cybersecurity solutions. Automotive Tier 1 supplier Continental acquired the company in 2017 for $430 million.

So this is a concern the industry is taking seriously. And solutions are being developed.

5G is a necessity, not a luxury…

Next up is a question about the 5G wireless rollout…

Everything I read on the internet seems to contradict your theories. You say 5G will make 4G obsolete. Others say 4G is going to be around for a long time. Also, a lot of people are going to say they are perfectly happy with the speed of 4G. Please give me your take on this.

– Gary Y.

Thanks for writing in, Gary.

This can certainly be a confusing topic. Everything that you wrote in your question is true, and everything that I have written about 5G is also true… The discrepancy is simply in the time frame.

Many journalists tend to leave out inconvenient details about technology and implementation. Either they don’t understand it or they are trying to slant a story.

It’s true that 5G will be far superior to 4G. Remember, 5G speeds will be an average of 100 times faster than what we use today. So in that sense, 5G will eventually make 4G obsolete. If anyone could choose between the two, they would all choose 5G.

An analogy would be the difference between a dial-up modem or fast, broadband internet access. If consumers could save $10 a month by dropping back to a dial-up modem for internet access… how many would actually do that?

In my research, I’ve consistently outlined that the migration from 4G to 5G will take years to play out. And there will be three major phases of the 5G boom: Phase 1 – infrastructure, Phase 2 – devices, and Phase 3 – 5G-enabled services.

And these phases will, of course, overlap one another. Building out nationwide and global communications infrastructure takes time. These network rollouts occur over years.

Our 4G networks will be up and running for some time. In fact, 4G networks will be the network that 5G-enabled phones will fall back on in areas that do not have 5G network coverage yet.

The chart below gives us some idea of how prevalent the various network generations will be in the U.S. in the years ahead.

As to your other comment – that there are people who are perfectly happy with 4G – that may be the case right now. But I promise it won’t be the case for long…

This is one of my favorite charts to demonstrate why the world needs 5G.

Regular readers of mine have seen this chart before. It shows the amount of traffic flowing over our current 4G networks.

Look at the most recent figure from Q1 of this year. Our wireless networks saw nearly 30 exabytes of data traffic. In Q1 of 2018, that number was little more than 15 exabytes. As I’ve mentioned, an exabyte is equivalent to 100,000 times all the printed material in the Library of Congress.

What this means is that network traffic essentially doubled in a year. And it is only going higher from here.

Our current 4G networks simply can’t handle this much data traffic efficiently. Imagine bumper-to-bumper traffic at rush hour. That’s what’s happening right now with our wireless networks.

Fortunately, 5G will solve this problem. With 5G, all that data will be transmitted at lightning speeds with essentially no delay. And many new services will only be available over these new 5G networks.

Once consumers see these services and understand how they can improve their quality of life and add convenience, most will choose to migrate to the new networks.

It is also worth mentioning that the industry is in the process of slowly phasing out 2G and 3G networks entirely. It takes years to migrate customers and devices like vehicles and infrastructure from these old wireless networks to the new ones. But there is a strong desire to do so.

When these networks can be shut off, it frees up valuable radio frequency spectrum that can be used for the next generation of wireless network technology.

While it is a decade away, the industry has already begun to have early discussions about sixth-generation wireless technology.

I’ll have more for Bleeding Edge readers about this in about eight years! Stay tuned…

(5G represents one of the best investing opportunities of this decade and next. All told, 5G is expected to unleash $12 trillion in wealth over the coming years. 99% of investors will miss this trend entirely. I encourage you not to be one of them. Get exposure to the 5G megatrend by going right here.)

This makes it all worth it…

Finally, let’s conclude with a piece of feedback that reminded me why I do what I do…

Jeff, I have been a subscriber of Exponential Tech Investor since January of this year, recently signed up for your Early Stage Trader, and have become a lifetime member as well.

I wanted to send you this message simply to express my and my family’s deepest gratitude for your work and for your accurate guidance. We are up on almost every single recommendation, and for most of them, the gains have been incredible!

I am so glad that I trusted you through the ups and downs of the market this year, as your advice was accurate every time. THANK YOU, Jeff, for all that you do to help people like me have a chance to better their lives. Many blessings to you and to your family.

– Maura B.

Thanks for being a reader, Maura. It means the world to me that you’re enjoying and profiting from my research. As you likely know, it takes a lot of work to produce the content I do. But it’s all worth it if I know it’s helping investors like you become better off.

I’ll be the first to admit that understanding the world of high tech is difficult. I spent more than 25 years working deep in the technology industry around the globe, and I was always surprised by how little industry insiders actually understood.

They had insights and knowledge in particular segments of the industry but lacked a larger, more strategic perspective.

The breadth and depth of my education, work experience, global experience, and investment experience are some of my biggest assets in producing original research. And those assets are impossible to replicate…

I’m grateful to have so many subscribers that are willing to “dive in” with me on technology every week and take responsibility for their own financial futures. We all have so much more to look forward to.

That’s all the time we have this week. If I didn’t answer your question, be sure you submit it right here. I’ll do my best to get to it next week.


Jeff Brown
Editor, The Bleeding Edge