How 5G Is Transforming Retail: Trends, Chip Innovations, and Future Challenges

5G Industry Trend Analysis

1. 5G Technology Drives New Retail Development

On June 6, 2019, the Ministry of Industry and Information Technology issued 5G licenses, and with the innovation of the underlying communication network, the commercial application prospects of 5G in retail are becoming clearer. 5G enables smart retail, meeting more business needs and providing better services to users.

China is one of the most active countries in promoting and adopting 5G. According to the China Academy of Information and Communications Technology (CAICT), total investment in mainland China’s 5G mobile network from 2020 to 2030 is expected to reach 2.8 trillion RMB (≈ 411 billion USD), with a peak of 313.3 billion RMB in 2023.

Potential capabilities of 5G include a maximum downlink rate of 20 Gb/s, uplink of 10 Gb/s, latency below 5 ms from endpoint to the radio access network (RAN), and up to one million devices per square kilometer. These capabilities can profoundly impact retail, creating new business models.

5G delivers larger volumes of information more quickly across the supply chain, fostering the Internet of Things (IoT) in retail scenarios. The massive data collected forms valuable retail data chains, providing more entry points for AI and other cognitive technologies. Future 5G applications will increasingly rely on powerful core computing chips.

2. 5G Smartphones Become a New Consumer Electronics Trend

The arrival of 5G has sparked a new wave of smartphone upgrades, offering ultra‑fast experiences such as smooth 4K video playback and rapid downloading of large files.

The competition centers on 5G chips. Companies like Qualcomm, Intel, Huawei, MediaTek, and Unisoc have announced 5G chip roadmaps, shaping market dynamics.

While 5G‑enabled devices will boost chip market growth, dense network deployment and fragmented spectrum allocation raise hardware costs, potentially hindering market expansion.

Suning Retail Technology Institute predicts that ASICs will capture about 50 % of market revenue by 2020, with the Asia‑Pacific region showing the highest compound annual growth rate, followed by North America.

3. Current State of 5G Chip Development

1) Emerging Chip Monopolies

Retail applications of 5G rely on chip R&D. Global manufacturers are accelerating commercialization of mobile and base‑station chips to support innovative 5G services.

5G demands higher transmission rates, reliable connections, and low latency for scenarios such as eMBB, uRLLC, and mMTC, driving the need for redesigned communication chips.

Industry leaders like Huawei, Qualcomm, Intel, and Samsung are competing for dominance, with several 5G‑specific chips already on the market.

Patented technologies for high‑frequency BAW and FBAR filters are forming new monopolies, and China’s chip industry still lags behind world‑class capabilities in design, manufacturing, and testing.

Figure 1: 5G Chip Industry Analysis

2) Baseband Chips as a Key Component

Huawei’s Balong 5000 chip offers double the download speed of Qualcomm’s X50 and is already in commercial use.

Qualcomm announced the Snapdragon X55, the world’s first 7 Gbps 5G baseband chip, supporting both SA and NSA deployments.

5G chips must cover a broader frequency range from Sub‑6 GHz to millimeter‑wave, presenting new design, testing, and optimization challenges.

Baseband chips are critical for mobile devices, directly affecting download and upload speeds.

The high‑density, low‑power nature of 5G will also drive widespread IoT adoption, making baseband chips essential for smart homes, logistics, autonomous vehicles, wearables, and public infrastructure.

3) Base‑Station Chip Innovation Space

Huawei unveiled the world’s first 5G base‑station core chip, Tian‑Gang, featuring high integration, massive MIMO support, wide spectrum handling, and compact size, facilitating rapid large‑scale deployment.

Visionary discussions suggest future communication technologies could integrate with biological systems, hinting at bio‑inspired antenna concepts for remote power via photosynthesis.

4) Cost Challenges of 5G Chips

High costs of 5G RF front‑end modules and the technical difficulty of millimeter‑wave ICs increase chip prices compared to 4G, posing barriers to large‑scale retail innovation.

Reducing chip costs is crucial for broader application in retail scenarios.

5) Emerging Opportunities for Optical Chips

Core chips include micro‑electronic (CPU, GPU, DSP, FPGA, etc.) and optoelectronic components (transceivers, switches, photonic phased arrays, lasers, detectors, multiplexers).

While micro‑electronic chips remain under US dominance, silicon‑based photonic chips are entering a growth phase, touted as a key technology for the post‑Moore era.

Optical devices for 5G backhaul, mid‑haul, and fronthaul typically operate at 25 G, 50 G, 100 G, 200 G, and 400 G, with 100 G+ still lacking domestic production.

Suning Retail Technology Institute, as a forward‑looking research body, monitors 5G’s impact on retail and explores new development opportunities across modes, scenarios, products, services, and experiences.

Reference Materials

[1] Wang Juncheng, "Opportunities and Challenges of Chip Technology in the 5G Era", Modern Telecommunications Technology, 2017, 47(6): 50‑53

[2] Huawei Official Website, "Huawei Releases the World’s First 5G Base‑Station Core Chip – Tian‑Gang", Jan 24, 2019