Why Samsung is stepping up its foldable phone push

December 04, 2019 12:37
Samsung says it is enthused by the response to its Galaxy Fold, prompting the firm to roll out the devices in more markets. Photo: Bloomberg

The smartphone industry is readying for the next growth phase as the world enters the 5G era, with players pinning hopes that the advanced technology and new handsets will prompt consumers to upgrade their mobile devices. Meanwhile, some tech giants are also betting that foldable screen phones will add to the excitement in the market and provide growth momentum. 

Take a look at Samsung. The Korean electronics behemoth announced recently that it will expand the number of countries for sale of its Galaxy Fold smartphone to 60, saying demand for the new type of gadget has surpassed expectations.

The company will make the devices available in at least another 30 markets by February 2020, including Brazil, New Zealand, Chile, Italy, the Netherlands, Greece and Vietnam, according to reports.

Samsung initially rolled out its Galaxy Fold smartphone in the first half of this year. However, the first batch received negative feedback from tech journalists before the devices hit the street. Samsung then postponed the launch to September, making several improvements in hardware design and strengthening the screen protection.

The company hasn't disclosed the sales figures of the new devices, but the recent announcement for expanded sales suggests that the consumer response has been good despite the US$2,000 price-tag, which makes it much more expensive than any high-end smartphone in the market.

In further proof of the firm's high hopes, Samsung has said that it will release a second foldable screen smartphone next year. The new model will be a clamshell-style model. The phone will fold vertically, while the existing one folds horizontally. The device would be in a long rectangular size rather than a square-sized screen like Galaxy Fold.

Samsung has good reason to push the new foldable type of devices given the slowing industry sales overall in smartphones in recent years. One of the main reasons for the waning sales was that consumers were getting bored with the form-factor of the smartphone.

If you examine the various devices on the market, the main difference between different smartphones seems to be only the screen size or the size of the notch. Bar-typed flat-screen display design has not changed basically since the birth of the iPhone in 2007. Observers believe it's time for smartphone makers to explore a new design to encourage users to upgrade their handsets.

As mobile technology is entering the 5G era, a bigger screen can enable smartphone apps and content providers to provide more attractive content through a larger foldable screen on the device. That can serve as an incentive to users to buy a new phone when they sign up for 5G service.

Apart from Samsung, several leading smartphone makers in China have also announced their own foldable screen smartphone products. Huawei's Mate X device, which was priced at around 20,000 yuan, was a big hit among Chinese consumers since the device made its debut last month. All the stock was snapped up quickly, according to reports, with many Chinese consumers supporting Huawei after the company was targeted by US authorities earlier this year with sanctions.

Among other players, Xiaomi will launch a similar reverse-foldable screen smartphone soon in China, named Mi Mix Alpha. Lenovo unit Motorola, meanwhile, has unveiled the Moto Razr. The Razr, which will launch in the US market in January, has a much smaller foldable screen that would fold into almost half of its extended size, and therefore half of the size of a traditional smartphone.

That would make it compact and pocketable, analysts have noted. Some observers believe Moto Razr could be a winner compared with other foldable screen phones.

ABI Research has forecast that smartphone shipments involving some type of foldable, flexible, or rollable display will start picking up pace as early as 2020, and that such shipments could reach the 228 million unit level in 2028.

"Not only will smartphones see flexible displays applied to their hardware, but tablets are also in line for this enhancement," it said in a published note.

The foldable-screen gadget initiatives come as smartphone makers aim to challenge Apple’s dominance in the high-end smartphone segment, pinning hopes on a first-mover advantage in the new device type.

With their foldable-screen phones, Samsung, Huawei, Xiaomi and Motorola have narrowed the gap with Apple in the premium smartphone segment. Given the market dynamics, Apple could well step into the foldable screen war in the near future in order to maintain its dominance in the premium segment.

Smartphone makers can seize an opportunity to reap huge profits from foldable screen products before the gadget type gets commoditized, something that is bound to happen as more players jump onto the bandwagon and push prices down. 

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RC

EJ Insight writer