5G smartphones will account for over 50% of all handset sales in 2023. 'In comparison, it took 4G handsets five years to reach a similar level,' Strategy Analytics reported.

Mike Dano, Editorial Director, 5G & Mobile Strategies

October 8, 2021

3 Min Read
Smartphone vendors love 5G, but supply chain problems loom

5G is the fastest "G" in terms of uptake among phone makers, according to new figures from research and consulting firm Strategy Analytics.

The firm reported that 5G smartphones will account for over 50% of all handset sales in 2023. The technology is poised to reach that level after just four years of 5G phone sales. "In comparison, it took 4G handsets five years to reach a similar level," the firm reported.

Figure 4: 5G is becoming de rigueur among smartphones. (Source: Strategy Analytics) 5G is becoming de rigueur among smartphones.
(Source: Strategy Analytics)

The rise of 5G technology in smartphones has also upended the vendor marketplace. Huawei, once a leader in smartphones, has fallen dramatically due to ongoing US sanctions on its business. The company is no longer able to sell 5G-capable phones.

Into Huawei's place has jumped China's Xiaomi, which was the world's leading 5G Android smartphone vendor in the second quarter, according to Strategy Analytics. The firm reported Xiaomi accounted for 26% of the 95 million 5G Android smartphones shipped globally during the quarter.

Overall, Samsung remains the world's biggest smartphone vendor across all Gs, with 18.2% market share in the second quarter. But Samsung's growth has stalled amid Xiaomi's rise. Meanwhile, iPhone vendor Apple managed to increase its share of the overall global smartphone market with 15.1% share.

"We estimate China has overtaken the USA being the largest single market for Apple iPhone this quarter, for the first time ever," Strategy Analytics wrote in a release.

Figure 2: Samsung remains the top dog in smartphones. (Source: Strategy Analytics) Samsung remains the top dog in smartphones.
(Source: Strategy Analytics)

Another interesting dynamic in the global smartphone market: The cost of phones is increasing, partly due to the inclusion of 5G technology. Specifically, Strategy Analytics predicts that the global, average wholesale unit price for smartphones will rise 11% year-over-year to $310 in 2021, up from $279 in 2020. Partly as a result, global smartphone wholesale revenues are to hit a record $435 billion in 2021, the firm predicted.

Figure 3: The cost of smartphones is rising. (Source: Strategy Analytics) The cost of smartphones is rising.
(Source: Strategy Analytics)

Feeling the impact of component shortages

But another analyst firm, BayStreet Research, warns that the stratospheric rise of 5G among smartphone vendors could be stalled by ongoing component shortages. The firm predicts that 5G won't reach into 100% of all phones in the near term, as it previously expected, but will instead be included in around 95% of all phones, due to the ongoing component shortages.

Those component shortages have already tripped up some smartphone makers. "Samsung has really fallen behind the eight ball relative to other OEMs [original equipment manufacturers] on the global supply chain issue," said T-Mobile CFO Peter Osvaldik during an investor event last month. Specifically, Osvaldik noted that Samsung discontinued its Galaxy Note smartphone "which many of our customers just loved," and that many of the company's S-series smartphones "are in very short supply."

Continued Osvaldik: "Others that have a more Apple-oriented base are probably less likely to be impacted by this."

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Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

About the Author(s)

Mike Dano

Editorial Director, 5G & Mobile Strategies, Light Reading

Mike Dano is Light Reading's Editorial Director, 5G & Mobile Strategies. Mike can be reached at [email protected], @mikeddano or on LinkedIn.

Based in Denver, Mike has covered the wireless industry as a journalist for almost two decades, first at RCR Wireless News and then at FierceWireless and recalls once writing a story about the transition from black and white to color screens on cell phones.

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