- Apple likely won’t have its 5G phone ready next year unless its ongoing legal battle with Qualcomm is settled in a few months, UBS analysts said in a report out Wednesday.
- Verizon announced later on Wednesday that it was launching 5G coverage in Chicago and Minneapolis.
- Apple competitors Samsung and LG have debuted their first 5G phones, while the Chinese telecommunications giant Huawei has announced plans to enter the space.
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As the race to get in on 5G intensifies, Apple may not have a phone with the new technology available anytime soon unless its legal battle with the chipmaker Qualcomm is quickly resolved, UBS analysts speculated in two reports to clients out Wednesday.
“Barring a settlement with Qualcomm in the next few months, field work suggests Apple is increasingly in jeopardy of being unable to ship a 5G iPhone in 2020,” a team of analysts led by Timothy Arcuri wrote to clients on Wednesday.
The note was distributed just before Verizon announced on Wednesday that it had launched 5G coverage in Chicago and Minneapolis. The fledgling wireless technology has been touted for years as the better, faster “evolution” of 4G LTE technology we all rely on for streaming and browsing the web, and it’s finally beginning to come to market — for some.
The company’s inability to offer a 5G phone next year could be a near-term challenge as Apple is already grappling with slowing iPhone sales, the analysts said. Still, they believe an improving iPhone replacement cycle could cushion the blow of missing out on the 5G party.
“While it is possible/likely this continues to lengthen, AAPL remains steadfast in its estimate that actual upgrade rates are < 3 yrs which suggest we are now actually below full replacement rates — a factor which should soften any potential impact from the lack of a true 5G phone in 2020,” they said.
Apple competitor Samsung unveiled a foldable phone earlier this year that costs about $2,000 and can take advantage of the 5G mobile network. It is expected to arrive later this month. Additionally, LG also debuted a 5G phone back in February, and said it should hit the market in the first half of this year.
In a separate report out Wednesday, a different team of UBS analysts asked whether it even mattered that Apple might be falling behind.
“We already question the benefits of 5G for smartphones and believe signs of AAPL being willing to delay adoption to 2021 suggests it might share our concerns and is not very concerned about share loss from not having 5G,” analysts led by Bill Lu said.
Earlier this week, Apple slashed the price of its iPhones in China amid stiff competition from local competitors Huawei and Xiaomi.
Apple shares were up 23% this year. However, they’re still trading 17% below October’s record high of $233.47.
Read more Apple coverage from Markets Insider and Business Insider:
- Apple had a terrible, horrible, no good, very bad week — here’s what happened
- Apple’s big, flashy event underwhelmed investors. Here’s why.
- Apple just slashed iPhone prices in China as it continues to grapple with falling smartphone sales
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