The Snapdragon 865 is here, and it offers a host of exciting new features. The CPU design is based on the latest Cortex A77 cores, the Adreno 650 GPU offers sizable gains in performance and has updatable drivers, and the AI engine is twice as fast.
One of the more interesting changes is that there's no internal modem anymore. Qualcomm is instead offering the Snapdragon 865 with the Snapdragon X55 5G modem, and the chipset is sold as a package deal — device makers won't get the Snapdragon 865 unless they also opt for the X55 modem.
That means that if you're picking up a phone powered by the Snapdragon 865 in 2020, it will have a 5G modem with global bands. There's no 4G-only option available this time around, and that has a few consequences, particularly in the value flagship segment.
Value players will be turning to the Snapdragon 765 to power their devices in 2020.
The fact that device manufacturers will have to pay for a separate modem will inevitably drive prices up. Therefore, it's unlikely we'll see the same value-focused options powered by the Snapdragon 865 next year. For context, the Redmi K20 Pro with the Snapdragon 855 launched at the equivalent of $390, and the Realme X2 Pro powered by the Snapdragon 855+ debuted at $420. With the Snapdragon 865, that just won't be possible.
We're already seeing the effects of this change, with Xiaomi announcing that its Redmi K30 series will be powered by the Snapdragon 765 instead. The Snapdragon 765 is a mid-range chipset that debuted alongside the Snapdragon 865, but the main difference is that it has an integrated — but less capable — 5G modem. It's possible that most phones in the value category next year will feature the Snapdragon 765 in liue of the Snapdragon 865.
OnePlus may have to release a mid-range device to keep up in the value segment.
But the manufacturer that will be affected the most is OnePlus. Xiaomi and Realme primarily cater to buyers in the budget category, so they can offset any losses in the mid-tier space by pushing out more models in the $100 to $200 segment. But OnePlus has built its entire brand around delivering the latest hardware, and not being able to do that will put it at a significant disadvantage. Who would buy a OnePlus 8 that has the Snapdragon 765 when the $600 7T is powered by the Snapdragon 855?
OnePlus doesn't have an exhaustive portfolio of devices to fall back on, and its success is defined by its performance in the value space. It is in a tough spot, because even if it were to justify hiking the price of its devices by touting the 5G benefits of the Snapdragon 865, the feature is largely wasted in its largest market, India. 5G will not be commercially available in India for at least two to three years, putting OnePlus in a bind.
As such, it is entirely possible we'll see OnePlus roll out a mid-range phone in 2020 that's powered by the Snapdragon 765. The company already pivoted to a dual flagship cadence this year with the introduction of the OnePlus 7 Pro, and it is likely that next year's Pro variant will see a price hike that puts it closer to the likes of Samsung and Huawei's flagships.
2020 will be the year when 5G finally becomes viable in most markets, and for better or worse Qualcomm is going all-in on the next generation of cellular connectivity. It will be interesting to see how that affects the value segment.
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