Do we really need Foldable smartphone?

A foldable phone is a niche concept that is not particularly new. I have been hearing about this since I have been actively following the smartphone domain. So where it started?

Foldable phone ideation.

It started due to two major reasons.

• Increasing demand for smartphones with bigger display sizes.

Chart1: Increasing demand for bigger display size smartphone in the US

• Slowing down smartphone sales with an increasing replacement period. With the increasing time taken to replace the smartphone, brand profits are taking a hit, and there is only so much you can do in terms of increasing the price.

As per recent IDC data, the growth in the foldable smartphone shipment has been robust, growing much faster than overall smartphone shipment, though at a small base.

As we can see from the data, it will continue to be niche concept even in the years to come.

Chart2: Foldable phone shipment estimate

History.

The first-ever foldable phone was launched on the 31st October 2018. It was from a company called Royale, and they called the phone the Royole Flexpai. The phone was still not in a usable format. The phone had a lot of false touches, was costly, and was hardly practical for further use.

A few months later, both Samsung and Huawei released their foldable phones, named the Galaxy Fold and the Mate X, respectively. Both of these phones were never made available to the public, and even if they had been, a very small number of them would have been sold because they were really expensive. The Mate X had a problem on the screen after multiple folds. The Galaxy had a similar problem, apart from the hinge breaking.

Moving forward…Samsung dominates the space with its consistent improvement and presence

Samsung is most active in the space, and other Chinese players are still joining the experiment. But Apple, one of the most innovative brands, has yet to make an entry in this space.

Chart3:

Will Apple entry make any impact?

It also comes to the point, will Apple make any entry into the space? I mean, look at the iPad sales, if Apple launches a phone with a two in one concept, will it help pick up the demand?

iPhone's share of total revenue is declining, while iPad share is stable since 2018. It may be Apple will likely experiment in the new space to revive the slowing iPhone market. We should also not forget that the concept is very much active in the premium space, which is also the target group for the iPhone.

Chart4: iPad still continues to maintain a healthy share of Apple’s total revenue

So, lets contemplate future of the foldable smartphone

Drivers:

• Two in one product—can be used as a smartphone and tablet
• Though the price was skyrocketing, it is slowly coming down and may come down to a level that mass audience can afford.
• Any other?

Constraints:

• Though we have already talked about price and the ifs and buts related to it. But the biggest BUT is that the price is still too high for the mass audience to afford it.
• Folding and unfolding the phone continuously poses the danger of damaging the screen (at least in the user’s mind). Marketers have a big job to convince the consumer on this front.
• One of the fundamental assumptions for introducing the concept was a two-in-one product--a tablet and a smartphone. But what if the user doesn’t need two in-one products?
• Last but not least, the folded size of the device will be too large to hold in the hand or otherwise.

Hence constraints far outweight the drivers and one of the explanation on why it continues to be niche concept.

What do we have in store for the future?

Although the foldable phone market has been slow to develop and remains a niche concept. An earlier constraint was both quality and price and hence a conservative estimate by IDC.?But the future may be promising if prices are brought down. We also hope in a few years, the technology will probably become cheaper and more robust & we may don’t have any quality problem for Foldable phone.

Additionally, Apple's move will be a defining in the space to make the concept even more popular.