5G – July
The smartphone market remains weak, with positive momentum, if any, coming from the recent release of the iPhone 14 family and the heavy promotion Samsung Electronics (005930.KS) is doing for the Z Fold 4 and Z Flip 4 models. It is a bit early for 3Q smartphone shipment data, however based on mobile display panel prices alone, we expect the 3Q smartphone shipment and sales numbers to be down again in 3Q, after a 7.5% q/q and 6.3% y/y decline in 2Q. While the panel price decline does not track directly with shipments, it gives some indication as to the potential for another decline in smartphone shipments in 3Q, despite the typical build for the upcoming holidays.
5G smartphones continue to grow, with July seeing the number of available 5G smartphone growing 7.1% m/m and up 83.8% y/y (410.5% over 2 years), while the number of vendors offering 5G devices (phones, CPE equipment, Routers, etc.) up 3.1% for the month and up 39.2% for the year in this very weak mobile device market. While not a ‘study’ in that we cannot compare to-date y/y data, however anecdotally, for all of last year 5G smartphones represented 42.6% of all smartphone models as compared to 50.3% this year to date.
Sub 6 spectrum is still the choice for the majority of 5G smartphones, while Apple continues to support both Sub 6 and mmWave, however the necessity for mmWave tower locations to be considerable more dense than Sub 6, makes it more costly to deploy, limiting it to use in private networks, large venues (stadia, malls, etc.) and dense urban areas. Currently our data suggests that 42% of available smartphones are able to utilize mmWave frequencies (including those phones that can use both), while 58% are Sub 6 equipped only.
All in, we expect that 5G smartphone availability will continue to grow throughout 2023, albeit at slower growth rates as it penetrates further into the smartphone ecosystem, but will become more subject to the macro CE environment as the technology becomes commonplace to consumers. While based on advertising, one would expect that the entire US is now able to provide 5G service, we show the coverage maps for the three major US carriers and note that only the purple lines indicate 5G coverage, leaving vast areas across the US where 5G is still unavailable. As that infrastructure continues to be built out 5G smartphones will be the natural choice for those looking to replace or upgrade.
Sub 6 spectrum is still the choice for the majority of 5G smartphones, while Apple continues to support both Sub 6 and mmWave, however the necessity for mmWave tower locations to be considerable more dense than Sub 6, makes it more costly to deploy, limiting it to use in private networks, large venues (stadia, malls, etc.) and dense urban areas. Currently our data suggests that 42% of available smartphones are able to utilize mmWave frequencies (including those phones that can use both), while 58% are Sub 6 equipped only.
All in, we expect that 5G smartphone availability will continue to grow throughout 2023, albeit at slower growth rates as it penetrates further into the smartphone ecosystem, but will become more subject to the macro CE environment as the technology becomes commonplace to consumers. While based on advertising, one would expect that the entire US is now able to provide 5G service, we show the coverage maps for the three major US carriers and note that only the purple lines indicate 5G coverage, leaving vast areas across the US where 5G is still unavailable. As that infrastructure continues to be built out 5G smartphones will be the natural choice for those looking to replace or upgrade.
5G Coverage - US - Verizon (Upper Left), AT&T (Upper right, T-Mobile (bottom) – Source: nperf.com
5G Ecosystem - Primary Indicators - Source: SCMR LLC, GSA.com
Selected 5G Devices - Device Offerings - Source: SCMR LLC, GSMA
5G Smartphone Unit Volume & ROC - Source: SCMR LLC, GSA.com
5G Frequency Band Device Share - Source: SCMR LLC, GSA
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