The big picture: The smartphone upgrade cycle has slowed as of late as consumers are getting more life out of their devices. 5G was expected to spur a super cycle of upgrades but pricing could be a significant barrier, notes Brad Akyuz, executive director and industry analyst at NPD Connected Intelligence.
Premium smartphones have been commanding around $1,000 for well over two years now. Even though consumers are more comfortable with the idea now than they were initially, that doesn’t mean people are forking over the big bucks in droves.
According to data from The NPD Group’s new Mobile Phone Tracking service, fewer than 10 percent of consumers are spending more than $1,000 on their smartphones.
Considering the high cost of 5G-enabled flagships – early examples are regularly going for around $1,200 – and the fact that this trend isn't likely to deviate in 2020, some are worried that 5G might not make as big of a splash out of the gate as originally anticipated.
Others are concerned that current 5G tech simply isn’t scalable due to its extremely limited range and line-of-sight requirements. Others, still, have reservations with regard to thermal limitations.
That said, the deck isn’t entirely stacked against 5G. Awareness of the new tech has reached three out of four consumers according to NPD’s Mobile Connectivity Report. Furthermore, a third of smartphone owners reported interest in buying a 5G-enabled handset.