Analysts said that handset vendors are expected to ship up to 32-40 million 5G smartphones by the end of 2021, with a sales forecast for more affordable 5G devices under $200.
India had become the fourth largest market for 5G smartphones in terms of shipments when 5G networks were recently piloted in the country by Reliance Jio, Bharti Airtel, and Vodafone Idea.
As per IDC analysis, India is in fourth place, following China, the US, and Japan in 5G device shipments of 5 million units with the lowest average selling price of around $410.
“The Chinese market drives the ecosystem. Brands are making more SKUs, and then player makers like Mediatek are bringing in affordable chipsets, which are helping the market to open up,” Navkendar Singh, Research Director, Client Devices & IPDS IDC India, was quoted as saying by the Economic Times (ET) page.
“There is a device first strategy because the ecosystem is driven by China, and they are ahead of the curve. India will reach around 40 million 5G phone shipments, which is roughly a quarter of the total shipments,” Navkendar added.
5G smartphones will contribute about 24% of shipments to overall smartphone shipments in 2021, up from around 3.5 million, according to IDC estimates.
“5G continues to be one of the top three desirable features in smartphones. Consumers want future-proof devices, so 5G is a good fit,” Tarun Pathak, research director at Counterpoint Research, told ET.
However, Singh said that 5G is still not a "show stopper" feature phone customer, but the brand, through a marketing campaign, is highlighting 5G's capabilities as a talking point.
“5G's rise is faster than any other wireless standard before it, enjoying strong adoption in key markets such as China, the US, and Europe. India is a bit different where even without a network rollout, the devices are already on sale in One of the markets where the device ecosystem has preceded the technology transition. We estimate around 32 million 5G smartphones will be sold in India by the end of this year (about 19% of the total smartphone market),” said Pathak.
Prabhu Ram, head of the industrial intelligence group at market intelligence firm CyberMedia Research (CMR), said that 5G smartphone shipments are expected to potentially range from 25-30 million by the end of the year.
“As we move forward, we believe 5G will continue to accelerate and spread further to more accessible and lower price tiers,” added Ram.
As per Counterpoint, the share of 5G smartphones continues to grow, surpassing 14% in the quarter ended June itself. As per India's CMR, 5G smartphone shipments accounted for 13% of overall smartphone shipments in Q2 2021.
US-based Gorilla Glass maker Corning, which works with almost all handset makers in India and globally, said that 5G will speed up the replacement cycle because of those in India.
“We see more aggressive smartphone adoption. 5G will do the same. It's going to be a steep penetration curve, and we're going to push for a fast replacement cycle,” John Bayne, Senior Vice President and General Manager of Mobile Consumer Electronics at Corning Incorporated, told ET.
5G phones are already available for as low as Rs 13,999, and analysts say the price is expected to drop further.
“Globally, we've seen 5G devices as low as $140, so India won't be an exception. However, we believe that the price war in 5G is still some time away because from a BoM perspective (Bills of material). To manufacture 5G phones without sacrificing other key specifications. So brands will be careful about the same,” Pathak said.
Among the top 5 vendors, Realme had the highest 5G contribution and led the market with a 23% share in 2Q21, followed by OnePlus and Oppo, according to IDC. OnePlus led the premium 5G market in the second quarter.
