Coronavirus pandemic is hurting 5G phone sales in South Korea and globally

We are all witnessing the effect that the ongoing pandemic is having on the global economy and on tech industry sales. Unfortunately, along with smartphone sales that could be affected, Reuters now reports that 5G network demand could be suffering as well.

5G was first launched nationwide in South Korea

Samsung’s home country, South Korea, was one of the leaders in providing 5G to users, launching the new cellular network nationwide one year ago. However, its telecommunication companies seem to be struggling with maintaining the network and the public’s interest in it. Despite the initial interest towards the new technology, people in South Korea are now starting to question the service, taking into consideration the higher price on 5G-capable devices, combined with some existing 5G service stability issues.

Even the new Galaxy S20 5G phones are suffering from lower consumer demand. Reportedly, sales of Samsung’s flagship line in South Korea are down about 30% compared with early sales of the S10 series, according to a South Korean carrier spokesperson.

This could have an effect on global 5G phone sales

Unfortunately, the current public health situation is affecting the 5G launch globally. A lot of tech companies, including Apple, have planned 5G capable devices and are counting on the improvement and global development of the network in order to have customer demand for 5G smartphones.

Additionally, countries in Europe, such as Spain, Italy, France and Austria have delayed auctions of spectrum band ranges for their 5G networks due to the coronavirus pandemic.

Meanwhile, the Chinese economy seems to start its recovery and some China-based smartphone vendors state that sales of 5G smartphones are to start increasing while the country slowly returns to normal.

5G subscriber count in South Korea decreases

As we can see on the following graph, South Korean customers have been losing interest in being 5G network subscribers since the beginning of 2020:

 

This situation is unfortunate for Samsung as the company was counting on its home market to give a jumpstart to its new 5G smartphones’ sales. Analysts say that the current coronavirus situation has been tampering with Samsung’s plans to gain 5G phone market share before Apple releases the new iPhones in the fall of 2020.

Kim Hoi-jae, an analyst for financial firm Daeshin Securities, stated that due to the pandemic, people are cautious about buying new smartphones. What’s more, the analyst specifies that the public does not see much difference between 4G and 5G phones, and added that in this situation, 5G-capable budget phones will need to arrive on the market faster.