Why the 5G iPhone might slow Apple’s sales next year


iPhone 12 might mix iPhone 11 and iPad Pro designs
It might be years before you can use the signature feature in your 5G iPhone.
Photo: Ben Geskin

The 5G iPhone coming this fall is widely expected to be a huge windfall for Apple. But this handset might then turn around and hurt the company next year, according to a pair of market analysts.

And their prediction is equally bad news for those planning to upgrade to the 5G iPhone.

Releasing 5G iPhone is easier than deploying nationwide networks

Gene Munster and Will Thompson from Loup Ventures are among many analysts predicting an iPhone with 5G cellular-wireless networks will debut in September. And all of them agree it will be a strong seller out of the gate.

But Munster and Thompson are pessimistic about whether the necessary 5G networks will be widely available for this handset to take advantage of anytime soon. “We continue to believe that widespread US adoption of 5G, defined as 75% of the US population having consistent access to 5G, is still two years away (2022),” said the analysts from Loup Ventures.

They predict that a lack of available networks will drag on 5G iPhone sales in 2021. Year-over-year growth is still expected, but only about 2%.

After that, Loup Ventures’ analysts see long-term growth for Apple. “Starting in FY22, we believe Apple is positioned to have three years of 5-10% annual iPhone revenue growth,” said Munster and Thompson.

What a slow 5G rollout means for ordinary iPhone users

These analysts predictions matter to more than potential investors in Apple shares. If they are right, many of the people planning to upgrade to a 5G iPhone this fall won‘t get much immediate use out of its signature feature. And that situation might continue for years, if 5G availability isn’t widespread until 2022.

There’s nothing Apple can do about this. Installing 5G networks is in the hands of telecoms — in the US, that means AT&T, Verizon, T-Mobile, etc. But these companies are more optimistic.

Verizon CEO Hans Vestberg told CNBC last fall that 50% of America will have access to 5G by the end of this year. Loup Ventures called this prediction “aggressive.” AT&T has said that it expects half the US population to have next-generation wireless available in the first half of 2020.