[NEWS IN FOCUS] Samsung doubles down on foldables

A rendered image of the Galaxy Fold 2. The follow-up to the ill-fated Galaxy Fold is expected to come out this year. [BEN GESKIN]

With Galaxy S20 sales underwhelming, Samsung Electronics is holding fast to its foldable phone dream.

Koh Dong-jin, CEO and president at Samsung Electronics, teased the release of the Galaxy Fold 2, a successor to the ill-fated Galaxy Fold, saying that it will come out “before autumn.”

The new folding phone could determine the fate of smartphone business for the world’s largest smartphone maker this year after sales of the flagship model S20 came short of market expectations.

But the Galaxy Z Flip, a clamshell-shaped foldable that debuted with the S20, is achieving better-than-expected results, with annual sales estimated to reach 2 million units, according to Ko Eui-young, an analyst at Hi Investment & Securities.

The contrasting fates of the two releases could indicate an evolution in consumer preferences, whereby they may favor a more interesting form factor over an ultra-high resolution camera and processing power.

“The sales of S20 failed to meet market expectations, affected by the coronavirus outbreak,” said Noh Kyeong-tak, an analyst at Eugene Investment & Securities.

“Still, the Galaxy Z Flip, released at a similar time as the S20, managed to take off. Given the reception, Samsung will likely further its push for foldables,” the analyst said.

Tracking the filing of patents indicates a strategy in motion. The Korean Intellectual Property Office approved Samsung’s patent for a smartphone that folds into a Z shape last year.

It is a bolder foldable vision, with three screen sections to allow for more spacious display.

For users who look for a tablet-sized screen in pocket, it is a dream come true.

While it remains unclear whether the patented design will find its way to commercialization, the markets and media quickly feed the public with leaks and renderings of the sequel to the Fold.

One of the most notable changes surfacing is the potential support of the S Pen Stylus, featured in the Note series.

The Galaxy Fold 2 is also rumored to feature 256 gigabytes of internal storage for a lower starting price than its predecessor, according to SamMobile, an online news outlet specializing in the electronics maker.

The previous Fold retailed for nearly $2,000, despite the doomed launch following reviewer revelations that the phone’s screen easily broke.

Choi Bo-young, an analyst at Kyobo Securities, expected the price to be approximately 1.65 million won ($1,340) for the new phone, the range between the Galaxy Fold and the Z Flip.

Against this backdrop, the Fold 2 must prove that the second generation is not a prototype, as was the case for the original Fold.

Multiple media outlets predicted that Samsung will embrace Ultra-Thin Glass, or UTG, that was used on the Galaxy Z Flip instead of the plastic screen.

But the manufacturer still needs a layer of plastic to protect it from scratches since the Z Flip was said to scratch easily.

Ville-Petteri Ukonaho, associate director at Strategy Analytics, acknowledged the problems facing foldable models.

“For now, the foldables industry has several hurdles to overcome, including very high pricing, low yields of bendable displays, and questionable durability about whether the hinges or screens will last for more than a few months,” he said in a statement.

“However, the technical problems for foldables are not unsolvable, and we expect the issues to be addressed in the coming years.”

Strategy Analytics forecast global foldable smartphone shipments will grow strongly from under 1 million units in 2019 to 100 million by 2025, saying that the foldables will be “the fastest-growing segment of the premium smartphone market for the next decade.”

Kwon Sung-ryul, an analyst at DB Financial Investment, offered up a rosy outlook for the foldable phone market.

“The folding phones give a rarity that clients value,” the analyst said. “The sales of foldable phones will keep on increasing in the second half of this year despite the overall downturn in the smartphone market.”

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]