As the only successor to 4G technology used in smartphones and mobile computers, 5G was guaranteed to be a hit at some point – the only real question was how long it would take to really go mainstream. This week, a report from Counterpoint Research suggests that a sharp drop in 5G phone prices helped kick US sales into high gear, although the company notes that numbers are likely to change significantly after Apple’s entry into the 5G market this month.
The trend lines are clear: Average sales prices of 5G phones fell by $ 218 from January 2020 to July 2020, reaching a very low level of $ 730 – a fall of about 30% – while 5G phones increased their share of total smartphone sales from 3.3% to 1
Adoption of 5G technology remains a chicken-and-egg scenario worldwide, as carriers hope for widespread use of 5G devices to justify the deployment of 5G networks and the dismantling of older 3G tower hardware, but none of them can happen completely without the other. When higher speeds, lower latency 5G towers are ubiquitous, carriers have promised that transformative new industrial, automotive and mixed reality applications will be widely available, but 5G’s initial adoption is largely dependent on business and consumer demand for faster Internet access .
5G’s growth in the US is particularly interesting given the relatively mediocre performance of US 5G networks, which have continued to deliver uneven and inconsistently better than 4G performance across the major US geography through 2020. There is little question that more and aggressive pricing moves by leading 5G chipmaker Qualcomm enables the new technology to quickly reach more affordable handsets, most recently including regular models that users will buy regardless of their 5G features. Still, Counterpoint says that Samsung’s Galaxy S20 Plus 5G at 1200 dollars has been the best-selling 5G phone of the year to date, despite the availability of many cheaper models.
The apparent discrepancy could be Apple’s expected division of the first 5G iPhones into two categories: Pro models priced upwards of $ 999, and standard versions from $ 649. While iPhone 12 Pro models are expected to include full 5G connectivity, including support for low, mid and high band frequencies, regular and “mini” iPhone 12 models will probably only support 5G with low and mid band “below 6 GHz”. In the US, it can practically cover standard iPhone 12s at top speeds of 1 Gbps or less, while Pro models can reach 2 Gbps or higher when connected to millimeter wave towers – for now in extremely limited locations. As Apple accounts for at least 40% of the total U.S. smartphone market, sales of all iPhone 12 models are expected to increase both 5G’s fraction of the market and its average sales prices.
The adoption of 5G smartphones has been significantly higher in China. An earlier Counterpoint report noted that 33% of all phones sold in China during the second quarter of 2020 were 5G compliant, growth made possible by a combination of hyper-aggressive pricing from domestic companies, government-backed 5G network developments and enthusiastic interest from Chinese . consumers. Globally, 5G adoption rates are expected to increase rapidly as 5G network deployments expand across multiple territories and 4G-only chips disappear from the market.