Understanding the “Heat of the Herd”

Last week, my publisher Doug Hill asked me a provocative question: “What do you mean by the ‘heat of the herd?’”

I have long been an advocate of the unlicensed bands of the electromagnetic spectrum — the spans of radiation that are free from the exclusive assignments allocated to the established telcos through the auctions of the Federal Communications Commission (FCC).

Called the ISM bands, these unlicensed domains apply to industrial, scientific and medical uses in factories, laboratories, and hospitals, which cannot seek a new FCC allocation every time they wish to change a frequency or conduct an experiment. I have been predicting that all the creative action in wireless would ultimately migrate toward these unlicensed bands.

And indeed today some 80% of all traffic passes through unlicensed Wi–Fi channels. Even though only a small share of Wi–Fi runs in factories, labs and hospitals, the FCC under the visionary leadership of Ajit Pai has allowed Wi–Fi to expand and become the dominant source of wireless connectivity for all.

My longtime colleague and guide in the Telecosm, Bret Swanson reports on some of the results of this regime: “By now, many of the early–pandemic metrics of internet robustness are familiar. Zoom “zoomed” from 10 million daily users to 200 million. Microsoft Teams jumped from 32 million to 44 million. Comcast, a good proxy for residential broadband, said its average peak traffic is up 32%. The US movie box office may be down 100% from 2019, yet Netflix stock is near all–time highs.”

The Most Important New Standard

For the past year, however, I have been pretty much alone in predicting that the new Wi–Fi standard called WiFi6 would prove to be more important for the future of mobile communications than the establishment standard of 5G (fifth generation wireless). I have even conveyed the idea that WiFi6 can become a kind of 15G, offering at least threefold greater ultimate returns than 5G to the economy and thus to investors.

Doug sent me a link to the Drudge Report featuring an article from Bloomberg by one Tara Lachappelle alerting the world to WiFi6 as the most important new standard, the “upgrade the internet needs.”

When Drudge joins with Bloomberg to tout a new technology, so I thought, it is a portentous moment. When everyone knows something, the opportunity tends to be over. I told Doug I was experiencing an alarming sensation of the “heat of the herd.”

I was prompted to coin the phrase by the swashbuckling natural gas explorer of Canadian Hunter Corporation, who wrote: “You have to recognize that every ‘out front’ maneuver you make is going to be lonely. But if you feel entirely comfortable then you’re not far enough ahead to do any good.That warm sense of everything going well is usually the body temperature at the center of the herd.”

Well, these days my indignation toward the coronavirus residential lockdowns and business closedowns has earned me a chilly response from many of my favorite people in the world. No heat of the herd here.

My appreciation of some of the achievements of Chinese entrepreneurs in the face of excessive Communist party controls have evoked a frigid response from many conservative friends. My critiques of Trumpian mercantilism have failed to bring any warming comfort to my life as a Republican.

Although I have been a severe critic of Google philosophy in Life After Google, I regard this outstanding innovator neither as a monopolist nor as a privacy invader. I have been surprised to discover how many advocates of free enterprise — even passionate libertarians at FreedomFest — think government should crack down on social networks. So even at FreedomFest, I felt no heat of the herd.

Doug Hill assures me that I am still in the lonely vanguard on WiFi6, so my followers can still gain 15G returns. I believe he is right.

But I will remain vigilant and tell my readers when to enter and when to move on to the lonely redoubts of yet more inviting investments.

I will remain alert to all signs of the heat of the herd.

Regards,

George Gilder
Editor, Gilder’s Daily Prophecy

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George Gilder

George Gilder is the most knowledgeable man in America when it comes to the future of technology — and its impact on our lives.

He’s an established investor, writer, and economist with an uncanny ability to foresee how new breakthroughs will play out, years in advance.

And he’s certainly no stranger to the financial newsletter...

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