Why are 5G mobile phones more expensive than regular phones?

      The 5G, which is of national concern, is expected to be officially put into commercial use later this year, and the first batch of 5G mobile phones have been released in the domestic market.The speed increase that 5G networks can bring is indeed full of temptations, but we want to enjoy the benefits of 5G in the first place, we may have to pay some extra price. The most important of these is naturally the cost.

    The 5G tariffs of major operators have not yet been officially announced, but from the information currently exposed, the 5G package is definitely more expensive than the 4G that has been popularized by the whole people. In addition, the cost of purchasing a 5G phone is also a cost we must consider. 5G may not need to change the card to change the number, but must change the machine. From the perspective of several products that have been sold in China, 5G mobile phones are not cheap.

1、5G mobile phones are indeed more expensive, but the price increase is not an exaggeration

     From the 5G into the public eye, we are very concerned about the price of 5G mobile phones. Industry insiders have said that 5G mobile phones will definitely not be cheap in the early stage, and will even be very expensive. This will inevitably make some users who want to experience 5G in the first time feel a little worried.

      At the China Mobile Partner Conference at the end of last year, Wang Hengjiang, deputy general manager of China Mobile Terminal Corporation, mentioned that the price of 5G mobile phones is expected to be above 8,000 yuan in the 5G pre-commercial phase in 2019. You should know that even in the current price increase of the flagship machine, mobile phones with a price of more than 8,000 yuan are rare.

     But as 5G mobile phones went on the market in the second half of this year, everyone found that they were not as expensive as expected.

     Among the first 5G phones that have been released, the Samsung Galaxy Note10+ 5G released this week is probably the most expensive one. Its starting price is 7999 yuan, which is 1400 yuan higher than the 4G version of the Galaxy Note10 (6599 yuan).

     However, it is worth noting that the Galaxy Note10+ 5G and the standard version of Note10 are not the same in configuration. The former has a larger screen size, larger memory and storage space, and is equipped with a ToF camera. Therefore, the price difference between the two is not completely Because of the support for 5G.

      Huawei's first 5G mobile phone, the Mate 20 X 5G, was officially released last month. The price of this phone is 6,199 yuan, compared with the standard version of Mate 20 X (8GB + 256GB), which sells for 5,999 yuan, only slightly increased by 200 yuan, which is far from the price of nearly 10,000 yuan in the early news.

      However, this phone may not reflect the real price increase of 5G mobile phones. He Gang, president of Huawei's terminal mobile phone product line, said in an interview with the media that Huawei's pricing should consider both consumers' expectations and business demands. The first product hopes that more consumers can experience it. “The first product does not consider profit, but allows more consumers to accept it quickly (5G).” He Gang said.

    The iQOO Pro released this week also offers a 5G version, starting at $3,798, making it the cheapest 5G phone on the market. However, compared with the standard version (from 3198 yuan), the 5G version of iQOO Pro also has a 600 yuan increase.

     At the beginning of this year, Taiwan's industry information website DigiTimes reported that the cost of a 5G mobile phone is 80 dollars more than that of a 4G mobile phone (about 567 yuan). Then Xiaomi, the president of Xiaomi, said on Weibo that the 500 yuan "can't be fixed", including patent fees and value-added tax, etc., the first batch of 5G mobile phones "at least 700 yuan expensive."

     The wealthy Huawei may have the confidence to make a profit, but for most mobile phone manufacturers, 5G mobile phones may have a price increase of more than 500 yuan.

2、Why are 5G phones more expensive?

     The reason why 5G mobile phones will increase prices is naturally the most important reason. For electronic products, the use of any new technology will bring cost increases, whether it is a full screen, a folding screen, a lift camera or a screen fingerprint.

    JPMorgan Chase previously pointed out in the report that the flash memory chips of 5G mobile phones are 1.85 times more expensive than 4G mobile phones. The latter's flash chip members average $59, while 5G phones cost $85.4. As for the cost of processors and modems, 4G and 5G phones are $33.4 and $55.6, respectively.

     In addition to component costs, development costs also need to be taken into account. As a new network technology standard, manufacturers need to perform special debugging for 5G signals to ensure the stability of the connection. In addition, although 5G brings about a significant increase in the speed of networking, it is a burden on the power consumption and heat dissipation of the mobile phone itself, and manufacturers need to find ways to minimize these effects.

     In addition, the basic components of the general consumer, such as capacitor resistors, various management chips, heat-dissipating materials, antennas, etc., are also one of the reasons that affect the cost of 5G mobile phones. Most of the high-end products in these fields are in foreign companies, and it is not only difficult to achieve substantial development, but also various patent barriers are intensive, and the space for price reduction is also narrower.

     When it comes to patents, patent fees are also a cost that manufacturers must pay. Currently, Qualcomm, Nokia and Ericsson have announced their respective 5G patent fees.

     Qualcomm charges 2.275% of the total price of each single-mode mobile phone, 3.25% of the total price of multi-mode mobile phones; Nokia's 5G standard essential patent is 3 euros per device; Ericsson's charges range from 2.5-5 US dollars, depending on the equipment s price.

    Taking the iQOO Pro 5G using Qualcomm X50 5G baseband chip as an example, in addition to the cost of the baseband chip itself, vivo also needs to pay Qualcomm a patent fee of 94.95 yuan per device.

3、Next year, there will be cheap 5G mobile phones coming out

    In fact, in the 4G era, 4G mobile phones were also increased by a considerable amount at the beginning of the world. In 2013, the price of the first batch of 4G mobile phones was concentrated in the middle and high-end of 2000-5000 yuan, and the low-end models below 2000 yuan were lacking.

     At that time, the Samsung Galaxy Note3 was priced at 4088 yuan, while the 4G version rose more than 1400 yuan to 5,499 yuan; the Sony M35t was priced at 2,999 yuan, while the standard version of the M35 was priced at less than 2,000 yuan.

    In the upcoming 5G era, the situation is expected to be similar. The prices of the first batch of 5G mobile phones are generally at a high level, but when the technology is mature, the output is increased, and the cost of components is reduced, more and cheaper products will be available.

    Vivo executives have previously revealed that in the early days of 5G, due to the inability to achieve mass production, some components will adopt a small-volume customized model, which can not effectively control costs. Therefore, most of the 5G mobile phones in the second half of this year are positioned at the mid-to-high end. But these products will not be much more expensive than the same level 4G mobile phones, and most will not exceed 10,000 yuan. And until next year, 5G mobile phones are expected to drop to the mid-range or even the low-end, so that more users can enjoy 5G.

    All in all, because of the various reasons mentioned above, 5G mobile phones are indeed more expensive, but the price increase is not outrageous, and the iQOO Pro 5G is not a high price. But for price-sensitive consumers, next year is a better time to buy 5G phones. By that time, not only will the price of 5G mobile phones decrease, but the popularity of 5G networks will also be higher.

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