Looks Like Networks Will Have to Subsidise Our Pricey 5G Phones

By Holly Brockwell on at

There hasn't been a lot of excitement for 5G on the consumer side in the UK yet, but analysts are already predicting that we won't want to pay as much as 5G-enabled phones will cost, and the networks will have to subsidise if they want the handsets to sell.

If you missed the memo, 5G is – as you might expect – the next evolution of 3G and 4G. The G actually stands for 'generation', so the names literally mean 'third, fourth and fifth generation' of... itself. It's a bit recursive, like the way the first word of PHP is 'PHP'.

5G will give us much faster mobile internet speeds, and will allow things like mobile VR to advance further than they can right now. According to Qualcomm, one of the big companies driving 5G, you'll be able to download a 15GB movie in under a minute on mobile data. Hope you've got a decent data allowance with that 5G plan!

The downside, of course, is that it's going to be expensive at first. Like all tech, the first generation will cost the most, and then prices will come down as adoption increases. But according to Strategy Analytics, the first 5G phones are going to be so expensive that they think no one will buy them. We've already broken the £1k barrier for a smartphone, how much worse can it get?

Ken Hyers, director for emerging device strategies at Strategy Analytics, told Techradar that it's going to come down to the networks to push adoption:

"To kick-start 5G smartphone sales carriers will be forced to employ subsidies in order to bring customers onto their 5G networks. Phone vendors will be pressured to meet price points for their 5G devices that will leave them with razor-thin margins.

By 2025 half of all smartphones sold will be 5G. But in the near term there will be challenges for device makers as they navigate the transition to 5G. In every previous generation change at least one major phone maker has stumbled badly, and this generation will be no different."

Who do you think the stumbler will be this time? Hint: it's not Nokia, because even if they make nothing at all in the next decade, they get money every time a 5G phone is sold.

The UK networks are already gearing up for 5G, with Vodafone's commercial services coming sometime next year, plus trials in the Midlands and Canary Wharf, and potentially even on trains (an impressive jump forward considering signal on trains is currently equivalent to smoke signals in sunshine).

If you're unconvinced about 5G so far, here's Giz UK's guide to why you should care. In short: people livestreaming everywhere all the time. Yay.