The 5G revolution is coming, but it is still in its infancy, and as many people know, new technologies may still be expensive for the time being. According to the latest report of the Information and Communication Technology Promotion Institute (IICT) in Seoul, JP Morgan predicts that the price of 5G smartphone chips will be twice that of 4G devices.
Also Read: Who Will Be The King Of The 5g Chip Market?
According to JPMorgan Chase, the baseband processor and application processor of a 5G smartphone are twice as expensive as a 4G smartphone. The US investment bank speculates that the price of the 5G baseband processor is $33.40, while the price of the application processor is expected to be $55.60.
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The rise in AP and BP chip prices and the increase in the number of 5G handsets in the coming year are expected to significantly increase the profitability of the chip industry, possibly jumping from $540 million in 2019 to $5.99 billion in 2020. By 2021, the profit is expected to reach about $14.1 billion.
In this sense, not only the chip makers will benefit but other companies as well, including Apple, Huawei, Samsung, Xiaomi, etc. We mean these companies are developing their own processors as well. Say, Apple is expected to launch its first 5G iPhone in 2020, followed by new rumors that the first iPad Pro supporting this network will arrive in 2021.
One of the many reasons behind the slowdown in the smartphone market in recent years is that the upgrade cycle is long and needs to be boosted. However, with the launch of 5G smartphones, it’s expected that more customers will shift to new devices.