As demand for electronic components grows, so will the 5G chipset market.
The numbers speak for themselves. By 2023, 5G-enabled handsets will include 800 million units, according to a Canalys forecast. The proliferation of 5G devices that in 2019 amounted to 5 million user-linked 5G mobile connections is, in other words, projected to take off this year as consumers begin to make the switch.
Considering that the chipset is a key component in smartphones and computers, the 5G chipset market will reap the benefits when the race to lead 5G heats up. The battle for market share among Samsung, Qualcomm, Huawei and other leading semiconductor manufacturers will fuel demand and stimulate the global electronics industry.
To fully understand what’s at stake, let’s take a closer look at how radically this next-generation technology may grow the 5G chipset market:
- The difference between 4G/LTE and 5G networks is vast. The impact? All 5G devices will require redesigned chipsets.
- The size of the global 5G chipset market is estimated to hit $2,12 billion in 2020 and $22,9 billion by 2026, maintaining a CAGR of 48.7%, according to Allied Market Research.
- Recent 5G chipset developments include Qualcomm’s second-generation 5G New Radio (NR) modem, the global 5G standard for a new OFDM-based air interface, and the Snapdragon X55 5G modem, a single-chip multi-mode solution. Samsung, not to be outdone, has reportedly started mass production of its own 5G chipset, the Exynos Modem 5100, while Huawei’s new Balong 5G01 and Balong 5000 modems offer complete 5G solutions for multiple applications. Another market force is Mediatek’s newly released Helio M70, a 5G-modem supporting wireless networks ranging from 2G to 5G.
Skyrocketing demand for 5G chipsets and other parts will add another variable to a market where returning component shortages, trade wars, and weather-related events threaten to disrupt supply chains. We can probably expect the competition for both market share and parts to grow even more cutthroat as 5G smartphones currently under development reach the consumers.
OEMs have already felt the impact from the introduction of products like Samsung’s Galaxy S10 5G, Huawei’s Mate X, Xiaomi’s 5G Mi MIX 3, Oppo’s Reno 5G, and LG’s V50 ThinQ, all of which require redesigned printed circuit boards (PCB) and more electronic components to support connectivity to the 5G network. PCBs for 5G devices — to take one example — need not only more layers and advanced materials than standard PCBs, but also tend to require significantly more units of antennas (128-192 for 5G PCB compared to 64-96 for 4G PCB).
So, what’s next?
Navigating the 5G chipset market — or any global inventory of electronic components — requires a knowledgeable, trusted, and resourceful partner. In such a rapidly changing business environment, the importance of strategic planning and cultivating close partnerships cannot be overstated.