Coronavirus to hit 5G smartphone sales in 2020 – report

Just a week after the GSMA cancelled MWC2020 due to the concerns related to the coronavirus, a new report is predicting the outbreak of COVID-19, as the virus is now known, will also put a cap on 5G smartphone sales this year.

According to Strategy Analytics, 5G smartphone shipments will reach 199 million worldwide in 2020, increasing tenfold from 19 million units in 2019. 5G penetration is also forecast to rise from 1% of all smartphones shipped globally in 2019 to 15% of the total in 2020.

Table 1: Global 5G Smartphone Shipments Forecast in 2020

Global Smartphone Shipments (Millions of Units) 2019 2020
5G 19 199
Rest of Market 1,394 1,165
Total 1,413 1,364
Global Smartphone Shipments (% of Total) 2019 2020
5G 1% 15%
Rest of Market 99% 85%
Total 100% 100%
Source: Strategy Analytics

However, Neil Mawston, executive director at Strategy Analytics, warned that although the smartphone industry is growing quickly, "the ongoing coronavirus scare and subsequent economic slowdown will put a cap on overall 5G demand this year."

Such forecasts come as little surprise, but will still send shockwaves through an industry that is banking on sales of expensive new 5G phones and services to drive future revenue. Much depends on how quickly COVID-19 can be contained. Strategy Analytics expects the first half of 2020 to be much weaker than expected for the 5G industry, "but we expect a strong bounce-back in the second half of the year if the coronavirus spread is brought under control," said Mawston.

Concerns about the spreading coronavirus have also affected work at the 3GPP on 5G standards, while telcos and vendors fear disruptions to the supply chain. Apple has also warned investors it will miss sales targets for its current, March-ending quarter, while other technology events, including the RSA security show that starts on February 24, are also being affected, though not cancelled.

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— Anne Morris, Contributing Editor, Light Reading

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