The global sales penetration of 5G-enabled smartphones surpassed the penetration of 4G phones for the first time, reaching 51% in January this year, revealed a new study by Counterpoint Research.
China, North America and Western Europe happened to be the biggest drivers of this growth. China, in particular, had the highest 5G penetration in the world at 84% in January. The push for 5G from Chinese telecom operators, combined with the readiness of OEMs to supply competitively priced 5G smartphones to consumers, enabled this growth, said Counterpoint.
The 5G smartphone penetration for North America and Western Europe touched 73% and 76% respectively, as per the study. Both these regions were dominated by iPhone-maker Apple with a sales share of more than 50% and 30% respectively.
North America and Western Europe witnessed a likely upsurge in the sales penetration of 5G smartphones after Apple shifted to the next-generation telecom technology in October 2020 with the iPhone 12 series.
According to Counterpoint Research, these regions are anticipated to continue contributing significantly to 5G sales worldwide, as even without offering competitive specs, there is an immense and ongoing demand for a 5G upgrade within the iOS user base.
This demand, as per the study, is also driven by iPhone users who are ready for new devices after years of holding on to their older iPhones. For many, holding periods are nearing four years, the average replacement cycle for iPhones.
Mid-to-high price segment
Android 5G smartphones entered the mid-to-high ($250-$400) price segment because of the affordable processors offered by MediaTek and Qualcomm. They are now trickling down to the $150-$250 price range, contributing one-fifth of the 5G sales in January.
Amidst all these developments, Asia-Pacific, Middle East and Latin America are the next focus areas for OEMs to increase 5G penetration. 5G models in the sub-$150 price segment are the sweet spot for these regions, which are currently dominated by 4G, said the study.
According to Counterpoint Research, the low-end 5G SoC is priced more than $20 at present. Once it comes down to sub-$20, we will start seeing 5G smartphones in the budget segment.