Why 5G phones will cost Aussies more
EXCLUSIVE: Australians will have to pay significantly more for the next generation of smartphones and high-speed mobile downloads after Telstra and Samsung revealed record-breaking prices for the country's first 5G smartphone.
While neither company would reveal the full price of the Samsung Galaxy S10 5G phone at its Sydney launch, the phone will cost customers a minimum of $132 per month with a modest data allowance and on a 24-month lease.
The plans put the 5G model on track to become Australia's most expensive smartphone, breaking the $2399 record set by the Samsung Galaxy S10 Plus.
But some consumers may be ready to pay the higher prices as a new 5G Futures report revealed almost two in every three Australians plan to buy a 5G phone next, and one in four flagship phone owners are prepared to splash more than $1500 on the new technology.
Australia will become the third country in the world to use a 5G mobile network and devices after Telstra's Tuesday launch, only following South Korea and the United States which launched services earlier this month.
The company's 5G network, which is available in parts of 10 Australian cities, promises to deliver download speeds up to 20 times faster than 4G connections. In tests at Telstra's launch, downloads to the Samsung 5G smartphone exceeded one gigabit per second.
Samsung Electronics Australia mobile vice-president Garry McGregor said the demonstration was "an historic moment in smartphone technology".
But even though Telstra has committed to charging customers no extra to access its 5G service for the first year, customers will pay extra for the new technology.
Lease plans for the new 5G Samsung phone range from $132 to $199, and are higher than the Galaxy S10 Plus that broke smartphone price records in Australia earlier this year.
Telstra also revealed it would charge an additional $15 per month for customers to access its 5G network from next year.
Telsyte managing director Foad Fadaghi said buyers should expect higher prices for the new technology.
"The first handful of 4G phone models were all ultra premium in pricing and it's not a surprise that the first tranche of 5G handsets are priced in an ultra premium bracket," he said.
"Consumers can expect to pay more for a superior experience but over time you'd expect competition to level out the prices."
But new research, undertaken by Telsyte for mobile phone brand Oppo, revealed Aussie smartphone users may not be turned off the extra costs.
The 5G Futures report found 61 per cent of Aussies considered 5G a "must-have" feature for their next smartphone, and predicted there would be more than 15 million 5G smartphones in the market by 2023.
One quarter of flagship smartphone owners were also willing to pay top dollar for a 5G phone, according to the research, something Oppo Australia managing director Michael Tran said was not surprising given our reputation for being on the leading edge.
"Australians have always been early technology adopters and always looking to new technology," he said.
"And with any new technology, there needs to be more development and resources put in and that is something that will increase prices."
While the Samsung Galaxy S10 5G is the first 5G smartphone in Australia, more are slated to arrive in the coming months, including Oppo's Reno 5G phone launched in Europe this month, Huawei's Mate X with a large flexible screen, and LG's V50 ThinQ.