MediaTek’s Foray into 5G mmWave Signals a Welcome Boost to the Ecosystem

MediaTek has announced its first move into 5G Millimeter Wave (mmWave) connectivity with the Dimensity 1050 System-on-Chip (SoC), which combines mmWave and sub-6 GHz 5G technologies onto a single chip. This is the company’s first foray into dual connectivity, designed to deliver ultra-high throughput, low latency, and massive capacity, which will serve to provide improved end-to-end 5G user experiences, delivering more powerful features that allow smartphone vendors to differentiate their product lines. These enhanced 5G metrics offer key benefits in prominent use cases, such as in dense urban and public areas, sporting arenas, shopping malls, and Fixed Wireless Access (FWA) connectivity.

The growth of the 5G mmWave market has been stymied over the past couple of years due to a number of underpinning reasons and initial market concerns. Chief among these issues has been both device availability and network rollouts. In smartphones, the introduction of 5G mmWave brings with it underlying complexity and added costs, while network equipment vendors have been dissuaded by limited coverage, and higher energy consumption. Moreover, many mobile operators are still reluctant to turn to mmWave for a number of reasons, including unavailability of spectrum, high deployment costs, limited device availability, and a lack of use cases.

While mmWave is still challenged in many areas, stakeholders across the mobile value chain have been working hard to resolve these problems. Indeed, some of the complexity that mmWave brings to smartphones has been incrementally addressed using an evolved system approach and miniaturization of integrated Radio Frequency (RF) module designs, which has been led by chipset vendor Qualcomm. Such an approach has helped bring mmWave to compact smartphone industrial designs, while improving performance, latency, reliability, and efficiency. Despite these improvements, the use of 5G mmWave in smartphones until now has been limited at best, featuring mostly in Apple and Samsung high-end smartphones destined for just the U.S. market.

However, market adoption in the sector is set to change. An increase in 5G mmWave smartphones sales is expected, boosted not only by the augmentation of chipsets from MediaTek and the inclusion in greater numbers of smartphone models, but also by expanding ecosystem momentum. From a slow start, mainly restricted to the U.S. market, the impetus behind mobile mmWave continues to build, as a number of regions are targeting deployments, broadening across North America, Europe, and Asia. Activity is set to ramp up in the next 2 to 3 years with many more countries expected to assign mmWave spectrum, which is led by operators in Italy, Japan, Russia, South Korea, and Australia, with China also expected to join this roster at some point soon.

According to ABI Research, the global 5G smartphones market is set to grow 28% in 2022, reaching more than 750 million units, driven by an acceleration down the price tiers improving affordability and adoption. Forming part of this volume is mmWave-enabled phones, which are expected to account for 19% of 5G sales in 2022, compared with less than 14% in 2021, but growing to command a 43% share by 2027. Despite this continued growth of mmWave in smartphones, the feature is not expected to hit a critical mass of shipments in 2022, as it will take time to migrate from the high-end to the mid-range because of prohibitive costs and the effect on user experiences. Subsequently, the market will see a momentum swing toward mmWave in 2024, due to a notable uptick in available smartphone models and network rollouts, as well as an expansion into FWA devices as a fixed broadband replacement.

Adding MediaTek to the 5G mmWave mix brings welcome competition to incumbent Qualcomm, and both can help drive this next-generation 5G technology ecosystem, while growing scale to reduce the cost burden. However, if MediaTek is going to be successful in current mmWave markets, which for the time being is limited to the “buoyant” high-end U.S. market, its options are restricted. It also needs to resolve the complexity of the mmWave RF Front-End (RFFE) system, which it is assumed will rely on help from component suppliers, such as Qorvo, Skyworks, Avago, and Murata.

Due to the increased cost implications of adding 5G mmWave to smartphones, it is expected that MediaTek will have no intention of playing in the mid-range device sector or those destined for emerging markets anytime soon. However, it will find it challenging to match its “dance card” with leading high-end smartphone vendors in the United States, notably Apple and Samsung (which together account for nearly 80% of total U.S. smartphone sales), as they already have 5G mmWave phones available in the market. This potentially leaves MediaTek open to target U.S. players, such as OnePlus and Motorola, with its Dimensity 1050 SoC, both of which are starting to show increased market share. Indeed, there will not be a long wait to find out which vendor will launch first, as MediaTek has stated that smartphones using its new chipset will be on the market in 3Q 2022.

Outside of the United States, and despite a stalling of network rollouts worldwide, MediaTek has an opportunity to tackle 5G mmWave in Japan, despite the smartphone addressable market again being dominated by Apple, and China, where it may truly thrive. There have been a number of false dawns for the rollout of 5G mmWave in China over the past 12 months, but signs are that if it gets the go ahead, then MediaTek will be very well positioned to embrace overall ecosystem growth. While the company can trade on its close relationships with many leading Chinese smartphone vendors, it will face stiff competition from Qualcomm, which also works with local vendors, such as Honor, Oppo, and Xiaomi.

Undoubtedly, MediaTek’s first foray into 5G mmWave will be the U.S. smartphone market, where the company can showcase its viability and technological points of differentiation in the sector. However, it is likely that the evolution of China’s market will determine its ultimate success, including demonstrable evidence of the company’s ability to capture 5G mmWave ecosystem growth from Qualcomm, while pushing the technology into new sectors beyond smartphones’ notable FWA. Moreover, MediaTek will undoubtedly want to continue to trade on its increase in share of China’s 5G chipset market, where its shipments have been driven mainly by featuring in low- and mid-range smartphone offerings from Chinese brands. In addition, just as the 5G smartphone processor market in China had become increasingly competitive, incumbents can now sweep up the void left behind by the demise of Huawei’s 5G Kirin chipsets. With a suite of products bolstered recently by its Dimensity 9000 flagship 5G chipset and now the mmWave Dimensity 1050, MediaTek is well set to take on Qualcomm across the gamut of 5G solutions, not just in China, but globally, in what is fast becoming a two-horse race in an ever-expanding 5G sector.