Apple is reportedly taking a backseat in the 5G race set to take over the US early next year. Instead of rushing to develop a 5G iPhone for 2019, the company is apparently going to integrate the network standard in 2020.
There are many reasons why Apple is taking things slow, with one particularly big factor at play – money. As reported by VentureBeat, manufacturers will have to pay around $21 per unit to license 5G patents from Qualcomm, Nokia, and Ericsson.
Apple’s 5G Strategy
The figure will probably climb higher once other patent holders like Huawei and Samsung announce their fees. Nokia is charging a flat €3 rate per device, Ericsson is asking for anywhere between $2.50 and $5 per handset, and Qualcomm is demanding 2.275% to 3.25% of a smartphone’s price.
Qualcomm is currently busy fighting Apple all over the world, even trying to ban certain iPhones from entering the US. The latter has responded by switching entirely to Intel for the 2018 iPhone lineup’s modems. Rumor has it that the company is going to eventually dump Intel in 2020 by making its own 5G chips.
Also Read: 13 Plans Apple’s hatching for Future iPhones
Another factor holding the 5G iPhone back is coverage. It’ll take time for the technology to spread all over the world. Moreover, a 4G handset pays around $9.6 in licensing fees right now. Apple can either jack up the iPhone’s cost or wait for things to settle down and become cheaper.
Apple actually deployed a similar strategy a few years ago when 4G LTE first appeared. Android OEMs quickly got on board, but the Cupertino-based company waited for nearly 2 years before launching the iPhone 5 to great success.
Employing the same wait-and-watch plan for the 2020 iPhone makes sense, especially if Apple comes up with 5G modems of its own. If not, some say MediaTek will supply modems for the handset.