The first 5G smartphones will appear as early as next year and will combine one feature. All will have Android. Analysts predict that Apple will not decide to introduce 5G modems to next year’s iPhones. They will only appear in September 2020. The reason for such a strategy is… licensing fees.
Hardly any smartphone maker has shared their plans for models with 5G modems. The only official statements concern devices that will only be sold in the United States. Motorola announced the introduction of the 5G Moto Mod snap for the Moto Z3 smartphone. This accessory will come from the USA with exclusivity for the Verizon network. Meanwhile, LG intends to release a 5G smartphone in the first half of next year, which will operate on the Sprint network. What does the Apple thing look like? The Californian company is known for the fact that it approaches new solutions with a distance. It is not just about new types of screens (Apple has only now introduced OLED displays), or fingerprint readers (TouchID also appeared later than analogous solutions for Android smartphones). Apple also told us to wait for an iPhone with LTE support. It was the iPhone 5, which appeared 18 months after the premiere of the first smartphone with LTE modem. Similarly, it can be in the case of 5G.
License fees for each 5G smartphone can amount to 21 dollars, for Apple it means lower profits
The VentureBeat editorial team has been asking for appropriate calculations. Nokia will collect 3 euros for each 5G smartphone. Qualcomm, on the other hand, will charge a fee of $13. Another company that took an active part in the development of 5G technology is Ericsson. Therefore, the Swedes will charge between 2.5 and 5 dollars for each device. This means that Apple will have to pay about $21 license fees for each iPhone with a 5G modem. For LTE devices, the same cost is about $9.60. For this you also need to add the price of new mobile chipsets and antennas, which will be more expensive than the current solutions used in smartphones. This means that the later Apple releases 5G-enabled iPhones, the more money they will earn.
This strategy worked very well with Apple’s introduction of LTE modems. The operators managed to build 4G networks at that time, so people who bought the iPhone 5 could immediately use the faster mobile Internet. We must also bear in mind that the first 5G networks will be short on their target form at the beginning. Already some operators have admitted that the first generation of next-generation systems will offer 50% higher data download speeds than existing LTE-Advanced networks. Ultimately, this difference is to be 10 to 20 times, but it takes time. That’s why Apple can postpone the introduction of 5G service until September 2020.