Can 5G Wave Save The Dwindling Global Smartphone Market In 2019?

by Sohini Bagchi    Dec 04, 2018

smartphone

With global smartphone sales decelerating significantly in the last one year, the attention of mobile phone manufacturers is moving to new technologies such as 5G to differentiate the user experience on smartphones and generate new user value. Analysts believe 2019 will be the starting point of 5G rollout on smartphones to save the universal device from further decline worldwide and therefore most smartphone makers are launching their 5G ready phones next year.

The fifth generation wireless, 5G network that succeeds 4G, 3G and 2G technologies will have a major impact on every aspect of our digital economy as the 5G performance is driven by characteristics like high data rate, reduced latency, energy saving, cost reduction, higher system capacity, and massive device connectivity.

The Ericsson Mobility report stand out, including this one: 5G is going to have the fastest rollout of any cellular generation in history, ultimately going mass market in 2020 thanks to chipset improvements. 5G is expected to bring lower latency to networks, which means speed and connectivity in general will improve dramatically. For example, 5G phones are expected to support super speeds of up to 10 Gbps and the network is touted to be 100 times faster than 4G. 

Experts believe 5G smartphones are all the rage right and almost all leading brands are looking to launch the first 5G-ready device in the market. For example, OnePlus announced its plans to launch a 5G-ready smartphone sometime in the first half of  2019 and said that 5G will mark the beginning of a new line-up of smartphones from OnePlus.

Chinese phonemaker Huawei is one of the biggest proponents of 5G technology. The company has been perhaps the biggest names when it comes to the development of 5G network equipment and chips, with hundreds of engineers dedicated towards the efforts. Huawei is working on commercialising its first 5G smartphone and word has it that the company plans on making it available to the public in the first half of 2019. The other Chinese smartphone major Xiaomi Mi Mix 3 is also confirmed to bring support for 5G networks. 

In fact, in the third quarter of 2018, Chinese brands Huawei and Xiaomi alone, helped drive global smartphone sales, according to Gartner, with Anshul Gupta, research director, stating that if taken both Huawei and Xiaomi out of the global smartphone vendors list, smartphone sales would have declined by 5.2 percent. ”It is expected that the 5G variant will help these phones reach even greater heights in the coming quarters,” he said.

As such in the third quarter of 2018, Samsung experienced its biggest decline since Gartner has been tracking smartphone sales globally. Samsung’s smartphone sales declined 14 percent in the third quarter. Samsung’s Galaxy S9, S9+ and Note 9 struggled to revive demand in 2018, and its revamped midtier and entry-tier smartphones continued to face huge competition from top Chinese brands who grew market share in key markets, such as India, and their expansion into regions beyond Asia-Pacific continues to take away opportunities from Samsung.

However, to stay put in the race, Samsung has partnered with Verizon to announce the companies would sell a 5G smartphone in the first half of 2019. Samsung’s 5G phone will operate on the Qualcomm Snapdragon mobile platform, according to a press release.

In February, Qualcomm announced that it has partnered with 18 OEMs, including HMD Global, parent company of Nokia phones, to launch 5G-ready smartphone in 2019. In August, Motorola surprised everyone by introducing its 5G-enabled Moto Z3 phone. LG, one of Qualcomm’s list of partners will launch a 5G smartphone in the US sometime in the first half of 2019. Others like Lenovo, Oppo and Vivo among others have all joined the 5G bandwagon and are readying for their big launch next year.

However, the only exception to the rule may be Apple when it comes to 5G ready phones soon in the market. As reported by Bloomberg, Apple plans to wait until at least 2020 before releasing an iPhone capable of 5G connectivity. Perhaps Apple tends to delay the adoption is because it wants to wait for the trial versions of rival smartphones to be introduced, then it can release a better product with less glitches, reported Bloomberg, adding that while Apple has taken this approach with previous phones, they may not be as successful when it comes to 5G. The move from 4G and 5G is a major selling point for many new phones, placing Apple at risk of losing more money than now. Needless to say, Apple’s performance was flat in the third quarter of 2018 with a 0.7 percent growth.

Despite the 5G momentum, Gartner is cautiously optimistic about 5G technologies saving the dwindling fortune of global smartphone industry. “While 2019 will mark an important year for more R&D and testing/trials of varying 5G technologies, it is unlikely that 5G will be seen in mobile devices in significant volumes before 2020,”said Roberta Cozza, research director at Gartner. “We expect 5G mobile phone sales to total 65 million units in 2020.”

Ericsson too is careful to underscore that “this is just the beginning of a major technology shift, with many challenges ahead,” it notes that anticipation for 5G is “much greater” than what was seen ahead of the launch of 4G/LTE a decade ago. Consumers are interested, device makers are teasing early 5G smartphone designs, and cellular chipmakers are aggressively developing 5G products. Thanks to both demand and supply, Ericsson believes that 5G will be available to 40 percent of the world’s population by the end of 2024 — history’s quickest global cellular build-out, beating even LTE.