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5G will fuel smartphone industry growth — but it is only a temporary push

The spread of 5G into mainstream usage will help create a surge of smartphone sales but the hype behind 5G will only be a temporary lift for sales of devices like Apple's 2020 iPhone refresh, with the market expected to contract in 2022.




The global device market, covering desktop and notebook computers as well as smartphones and tablets, will grow by 0.9% in 2020 according to Gartner. Global shipments of all devices will increase from 2.15 billion units in 2019 to 2.16 billion by 2020.

The growth will be pushed by increased smartphone sales, especially those using 5G, as consumers seek to use the new communications technology. "Increased availability of 5G handsets will boost mobile phone replacements, which will lead global device shipments to return to growth in 2020," said Gartner research senior director Ranjit Atwal.

The global smartphone market alone will grow in 2020 by 1.7%, claims Gartner, with shipments of all devices rising after experiencing a weak 2019, where it experienced a 2% year-on-year decline. For 2020, the influx of 5G will help improve sales particularly in Greater China and some emerging markets in Asia and the Pacific.

Gartner's predictions of worldwide device shipments for 2020 to 2022

Gartner's predictions of worldwide device shipments for 2020 to 2022


Apple's "iPhone 12" lineup for 2020 is anticipated to be part of this push, with the models expected to have 5G connectivity in a significant capacity. However, 5G devices won't make up the majority of smartphone sales for some time.

It is estimated 5G models from all vendors will make up 12% of mobile phone shipments for 2020, with the share rising to 43% by 2022. Gartner believes this will be due to the prices of 5G smartphones decreasing, as well as further buildouts of 5G networks and increased coverage giving users more of an incentive to upgrade their devices.

"The market will experience a further increase in 2023," said Atwal, proposing in that year "5G handsets will account for over 50% of the mobile phones shipped."

While shipments will increase in the short term, Gartner's figures propose it won't be that way for very long. As mobile phone shipments will rise to 1.776 billion devices in 2020, the numbers will remain stable for 2021 at 1.771 billion, then will go down to 1.757 in 2022.

Gartner's predictions follow along with the musings of other analysts, firm in their belief the 2020 iPhones with 5G will effectively trigger a "supercycle" of upgrades. Many have increased their price targets on Apple's shares for the year due to the potential of upgrades.