According to a CNBC report on Monday, Susquehanna predicted that Apple (AAPL) could delay the launch of its faster 5G iPhone until January 2021. However, the firm stated that Apple would unveil the first batch of 5G iPhones in September 2020. However, these would be the slower versions of the 5G iPhone. The delayed iPhone model would feature the faster mmWave technology.
Limited mmWave support, in-house antenna to delay high-speed 5G iPhone launch
Susquehanna indicated that the tech giant’s decision to use in-house antennas might cause the delay. According to the CNBC report, the firm added that the 5G mmWave is widely available and that not many phones support it.
The firm’s investor note stated, “The delay in the launch, according to our checks, stems from Apple’s decision to in-source Antenna-in-Package (AiP) modules instead of purchasing from a 3rd party.” Susquehanna also indicated that the slower 5G iPhones would feature an LCD screen, while the faster version would have an OLED screen.
According to 9 to Mac, Susquehanna analyst Mehdi Hosseini predicted that Apple would ship 52 million sub-6GHz iPhones. Meanwhile, the number of mmWave iPhones could total 8 million. So, the full 5G iPhone shipment would total 60 million.
Qualcomm upbeat about mmWave-compatible phones by the end of Q1 2020
There are various kinds of 5G network coverage, and each offers a different speed. Some are just marginally faster than 4G coverage. However, mmWave technology is considered to be the fastest of the pack.
According to Fierce Wireless, Qualcomm (QCOM) president Cristiano Amon discussed this topic during December’s Snapdragon Summit. He said, “Real 5G is really the combination of sub 6 and millimeter wave, and that’s going to happen on a global scale.”
Fierce Wireless noted that Amon expected that “by the end of the first quarter of 2020, there will be smartphones that support both millimeter wave and sub-6 GHz.”
5G iPhone would be a significant revenue generator
According to a January 6 CNBC report, Wedbush analyst Daniel Ives stated that the firm has a “bull case” for Apple amid the 5G “super cycle.” He expects AAPL stock to reach $400 by the end of 2020. Ives’ price target is higher than Bank of America’s or Rosenblatt’s estimates released last Friday.
Ives noted, “iPhone 11 strength appears to have legs both in the US and China as installed base demand continues to look healthy into the March/June quarters with the drumroll into the highly anticipated 5G upgrade cycle in September.”
The CNBC report cited Ives’ prediction regarding worldwide iPhone shipments. He revealed that out of the estimated 950 million iPhones that have been shipped, 350 million represent the “window of an upgrade opportunity.” This upgrade could be for 5G iPhones or other models.
In addition to Ives’ optimism about the 5G iPhones, he also has an upbeat outlook about AirPods and Apple’s service segment. He expects the tech giant’s service business to generate $500 billion–$650 billion in revenue.
Meanwhile, WCCFtech’s Ramish Zafar expects Apple to earn $47 billion from 5G iPhone revenue in 2020. Zafar’s assumptions include a $790 average selling price of the iPhone and 60 million iPhone shipments, according to Susquehanna.
What are the stakes of delaying the 5G iPhone launch?
Apple delayed its 5G iPhone launch due to a lack of extensive coverage in the US. However, Samsung and leading Chinese brands have already captured the 5G market. Any further delay from Apple might be a loss of significant opportunity.
Samsung plans to launch Galaxy S11 in February, which is likely to be compatible with all the 5G networks. Moreover, Qualcomm’s president, Cristiano Amon, noted that most smartphones should have mmWave compatibility by the first quarter of 2020. In that case, will Apple risk losing some ground in this competitive scenario?
On the other hand, Apple’s cautious approach with 5G iPhones indicates its commitment toward quality. One set of 5G iPhones could hit the market by September 2020. However, the wait for the premium version might take longer.
It’s possible that by launching 5G iPhones in two phases, Apple wants to buy some time. We expect that Apple wants to gauge the market response to avoid taking a wrong turn with the premium 5G iPhone.