A Forecast from Renowned Apple Analyst
Samsung Electronics is forecast to supply 5G modems for Apple’s 2020 iPhones that support 5G networks.
Apple recently settled a legal battle with Qualcomm over patents and agreed to buy chips from Qualcomm again. Yet it is forecast to purchase 5G modems not only from Qualcomm but from Samsung Electronics.
The forecast was made by Ming-chi Kuo, a renowned long-time Apple analyst based in Taiwan. Kuo predicted that Apple will likely adopt 5G baseband chips made by Qualcomm and Samsung to lower supply risk, reduce costs and have better bargaining power.
Frequencies used for 5G services are the 28 GHz ultra-high frequency band and a lower frequency band below 6 GHz. Korea uses the 28 GHz frequency band and 3.5 GHz frequency band. Samsung Electronics focuses on the sub-6 GHz market.
The 5G iPhone is expected to come out sometime after September 2020. Apple is expected to release new 4G iPhone models before that.
Kuo forecast that the introduction of a 5G iPhone would spur a wave of upgrades and purchases, especially for high-end models. He expects iPhone shipments to stand between 195 million units and 200 million units in 2020. The iPhone's highest number of annual shipments hit 231 million units in 2015.
If Apple adopts 5G modem chips from Samsung Electronics for new iPhone models, it will pit the Korean company against Qualcomm. Currently, 5G modem chips are produced by Samsung Electronics, Qualcomm and Huawei. Huawei is also fast in developing 5G modem chips, but it will be difficult for Huawei to make a deal with Apple in light of the U.S. government’s security concerns about Huawei products. Samsung Electronics commercialized the Galaxy S10 5G, the world's first 5G smartphone. If 5G services stabilize in Korea, Samsung Electronics’s 5G modem performance will be automatically verified.
Foreign media outlets reported that Apple has already sounded out Samsung about receiving 5G modems due to its concern about a supply shortage.
Even though Apple relied on Intel as a new modem vendor while having a legal battle with Qualcomm, the move did not pay off as much as Apple hoped. Shortly after Apple ended its dispute with Qualcomm, Intel announced that it would withdraw from the modem market. Apple needs another modem supplier to gain the upper hand in purchasing chips from Qualcomm.
These days, Samsung Electronics is stepping up efforts to become the No. 1 player in the non-memory semiconductor maker. Recently, it took the wraps off a total solution for 5G terminals, including a 5G modem chip, a radio frequency (RF) chip and a power management chip.