Self-proclaimed iPhone loyalist Sam Zhang must soon decide on whether to continue using Apple’s flagship product or switch to a Chinese-brand smartphone. The X factor: 5G.
Photo credit: Kārlis Dambrāns
“I typically use an iPhone model for two to three years,” said 25-year-old Zhang, who has an iPhone 7 Plus and works for a foreign company in the southern coastal city of Shenzhen. “So if I buy the new iPhone 11, I won’t be able to use a 5G data plan for the next two to three years, which would be pretty dumb if everyone else is using the latest mobile service.”
Other iPhone users in the world’s largest smartphone market could also be prompted to make a similar decision, dampening the outlook on the mainland for the latest batch of iPhone models unveiled by Apple on Tuesday in the US.
Apple launched three new models – the iPhone 11, iPhone 11 Pro, and iPhone 11 Pro Max – all without 5G network support. Prices for the iPhone 11 start at US$699, which is about US$50 less than last year’s iPhone XR. But the top-of-the-line, 512 GB iPhone 11 Pro Max costs US$1,449, which remains at the high end of the market.
“On paper, a 4G iPhone won’t look up to snuff in China, considering how aggressively we’ll see 5G being pushed there in the upcoming quarters,” said Bryan Ma, vice president of client devices research at IDC. “That will make iPhone users think twice or, perhaps, delay their replacements until next year in the hopes that Apple has a 5G model available by then.”
Such a reaction would not augur well for China’s overall smartphone market, which has been on the decline because of longer replacement cycles and growing channel inventories.
While the launch of new 5G Android smartphones and the roll-out of ultra fast, next-generation mobile services suggest growth opportunities, concerns remain about domestic consumption amid an escalating US-China trade dispute that saw the mainland’s economic growth reach a record low of 6.2% in the second quarter.
Smartphone shipments on the mainland fell 6% to 97.9 million units in the second quarter, down from 104.2 million units a year earlier, according to data released last month by research firm IDC.
Apple plans to hold off until at least 2020 before offering an iPhone that can connect to 5G networks, according to a Bloomberg report in December, citing people familiar with the US technology giant’s plans.
“Since a number of players have started launching their flagship 5G smartphones, we could expect more affordable phones with 5G capability to become available too,” said Kiranjeet Kaur, senior research manager with IDC Asia Pacific’s client devices group.
“The lack of 5G support on phones released in countries where 5G has already launched, or is expected to launch soon, will make 4G-only phones less attractive.”
Huawei Technologies, China’s largest smartphone vendor, started selling its Mate 20 X 5G smartphone in the country on August 16, priced at 6,199 yuan (US$870). Pre-orders of the handset exceeded 1 million, according to the Shenzhen-based company.
The Axon 10 Pro 5G smartphone from ZTE Corp and Samsung Electronics’ Galaxy S10 have also been released on the mainland.
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