5G will fuel smartphone industry growth -- but it is only a temporary push

Posted:
in iPhone
The spread of 5G into mainstream usage will help create a surge of smartphone sales but the hype behind 5G will only be a temporary lift for sales of devices like Apple's 2020 iPhone refresh, with the market expected to contract in 2022.




The global device market, covering desktop and notebook computers as well as smartphones and tablets, will grow by 0.9% in 2020 according to Gartner. Global shipments of all devices will increase from 2.15 billion units in 2019 to 2.16 billion by 2020.

The growth will be pushed by increased smartphone sales, especially those using 5G, as consumers seek to use the new communications technology. "Increased availability of 5G handsets will boost mobile phone replacements, which will lead global device shipments to return to growth in 2020," said Gartner research senior director Ranjit Atwal.

The global smartphone market alone will grow in 2020 by 1.7%, claims Gartner, with shipments of all devices rising after experiencing a weak 2019, where it experienced a 2% year-on-year decline. For 2020, the influx of 5G will help improve sales particularly in Greater China and some emerging markets in Asia and the Pacific.

Gartner's predictions of worldwide device shipments for 2020 to 2022
Gartner's predictions of worldwide device shipments for 2020 to 2022


Apple's "iPhone 12" lineup for 2020 is anticipated to be part of this push, with the models expected to have 5G connectivity in a significant capacity. However, 5G devices won't make up the majority of smartphone sales for some time.

It is estimated 5G models from all vendors will make up 12% of mobile phone shipments for 2020, with the share rising to 43% by 2022. Gartner believes this will be due to the prices of 5G smartphones decreasing, as well as further buildouts of 5G networks and increased coverage giving users more of an incentive to upgrade their devices.

"The market will experience a further increase in 2023," said Atwal, proposing in that year "5G handsets will account for over 50% of the mobile phones shipped."

While shipments will increase in the short term, Gartner's figures propose it won't be that way for very long. As mobile phone shipments will rise to 1.776 billion devices in 2020, the numbers will remain stable for 2021 at 1.771 billion, then will go down to 1.757 in 2022.

Gartner's predictions follow along with the musings of other analysts, firm in their belief the 2020 iPhones with 5G will effectively trigger a "supercycle" of upgrades. Many have increased their price targets on Apple's shares for the year due to the potential of upgrades.

Comments

  • Reply 1 of 7
    razorpitrazorpit Posts: 1,796member
    Maybe I'm too simplistic, or just cynical, but doesn't every new technological advancement provide a temporary push?

    In this day and age who is upgrading their original iPhone with Edge because the new model offers 3G or 4G? Retina displays were a big thing at one time, who is still upgrading because they really need that Retina display? For that matter who is upgrading just so they can finally get that Max sized display?
    MplsPkayess
  • Reply 2 of 7
    MplsPMplsP Posts: 3,244member
    razorpit said:
    Maybe I'm too simplistic, or just cynical, but doesn't every new technological advancement provide a temporary push?

    In this day and age who is upgrading their original iPhone with Edge because the new model offers 3G or 4G? Retina displays were a big thing at one time, who is still upgrading because they really need that Retina display? For that matter who is upgrading just so they can finally get that Max sized display?
    You underestimate the lemming effect!

    You are completely right - Smartphones are a maturing/mature product. There have been incremental improvements over the last several years but not nearly at the rate they occurred when the original iphone first came out. The vast majority of people don’t even know what 5G actually is, much less know what they can/will use it for. If they did, they wouldn’t pay for a new phone, since there aren’t any smartphone uses for it. What the average consumer knows is what’s being pushed by the telecom industry - “5G is the next big thing!” And since 5 comes after 4, “it has to be better than 4G, therefore I have to have it.”

    There are some people who will get the first 5G iphone they can get just because they’re early adopters and they have to have the latest. There are others who will look for it because they’ve been conditioned that they need it, there are others who actually understand technology who will be smart enough to wait, and there are others like my wife who say ‘my phone does everything I need it to, why should I pay for a new one?’ Just how many are in each camp remains to be seen.
    muthuk_vanalingamtmaylkruppkayessrazorpit
  • Reply 3 of 7
    The spread of 5G into mainstream usage will help create a surge of smartphone sales but the hype behind 5G will only be a temporary lift for sales ...
    Well, they got that one word right -- HYPE.  5G is nothing but hype to increase phone sales now, well before it's even useful.
    MplsP
  • Reply 4 of 7
    blastdoorblastdoor Posts: 2,435member
    Gartner thought Windows Mobile would take over the world, so I wouldn't put too much stock in their forecast. 

    95% of the marketing hype around 5G has been focused on mmWave, which will only be truly accessible to a fraction of customers, a fraction of the time. 

    The only way for this alleged surge in sales to materialize is if customers can be kept in the dark long enough. I'm skeptical that will happen. 
    muthuk_vanalingamrazorpit
  • Reply 5 of 7
    geekmeegeekmee Posts: 472member
    What I don’t understand, is Apple is known for creating products that are greater than the sum of their parts. 

    Now with 5G components the press acts like competitors have been sand bagging.
  • Reply 6 of 7
    Rayz2016Rayz2016 Posts: 6,957member
    blastdoor said:
    Gartner thought Windows Mobile would take over the world, so I wouldn't put too much stock in their forecast. 

    95% of the marketing hype around 5G has been focused on mmWave, which will only be truly accessible to a fraction of customers, a fraction of the time. 

    The only way for this alleged surge in sales to materialize is if customers can be kept in the dark long enough. I'm skeptical that will happen. 
    Agreed. Can’t see the point of this if it needs transmitters every few feet and is blocked by walls. 
  • Reply 7 of 7
    avon b7avon b7 Posts: 5,895member
    Rayz2016 said:
    blastdoor said:
    Gartner thought Windows Mobile would take over the world, so I wouldn't put too much stock in their forecast. 

    95% of the marketing hype around 5G has been focused on mmWave, which will only be truly accessible to a fraction of customers, a fraction of the time. 

    The only way for this alleged surge in sales to materialize is if customers can be kept in the dark long enough. I'm skeptical that will happen. 
    Agreed. Can’t see the point of this if it needs transmitters every few feet and is blocked by walls. 
    It is worth remembering that no signal coming from cell towers is actually deployed to go through walls and into your home. They are deployed for street coverage and public access only.

    What we get at home is the overlap from that coverage and some signals will do better at getting in than others.

    In the case of mmWave it is clear that it was never even imagined it would go through walls. That is a user misconception.

    mmWave plays to its own advantages of which there are many. It was never ever considered to be some kind of one size fits all solution. It is not some kind of 'true' 5G.

    Your signals will reach you through overlap, routers, CPEs, APs etc. 

    Just like it does now. 

    llama
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