In 2019, Samsung and Huawei, the top two global smartphone manufacturers, both introduced foldable screen phones, sparking expectations for a new growth category in the long-homogenized smartphone market.
Similar to past rapid adoptions like variable refresh rate screens and under-display fingerprint sensors in smartphones, many anticipated foldable phones to quickly become mainstream, akin to the once dominant large-screen phones in the industry.
However, after 5 years, foldable screens remain niche within the smartphone market, despite price drops exceeding 10,000 yuan.
According to TrendForce data, global foldable phone shipments are projected to reach 15.9 million units in 2023, a 25% year-on-year increase, accounting for only about 1.4% of the overall smartphone market that year.
In the Chinese market, foldable screens also hold a modest share. IDC data shows that in 2023, China's foldable phone shipments reached around 7.07 million units, a 114.5% year-on-year growth. Though significantly higher than the global market, it still only represents 2.4% of the Chinese smartphone market.
Even in the high-end market, foldable phones with their premium price tags are not considered mainstream. According to Analysys, foldable phones accounted for only 9% of China's high-end smartphone market (>$600) in 2023.
The growth potential for foldable phones seems to be slowing down. TrendForce forecasts that foldable phone shipments in 2024 will reach around 17.7 million units, with an expected 11% growth. The market share is projected to slightly increase to 1.5%, still below market expectations.
Since the release of the iPhone in 2007, there has been little variation in the appearance of smartphones, with the trend towards larger screens being the closest to the foldable screen concept.
In 2011, Samsung introduced the Galaxy Note with a 5.3-inch screen, the largest globally at the time. While Steve Jobs insisted on the 3.5-inch screen size being most user-friendly, Samsung's trend of large screens quickly swept the smartphone market. Huawei, Xiaomi, Lenovo, and other Android manufacturers followed suit, with soaring sales proving that large-screen phones better met user demands.
Finally, in 2014, Apple launched its first large-screen iPhone, the iPhone 6. Since then, no mainstream manufacturer has released smartphones with screens smaller than 4.5 inches. Large screens became an industry and user consensus within three years and have persisted to this day. Even the iPhone 13 mini, labeled "mini" in the past two years, features a 6.1-inch screen, far exceeding the previous 3.5-inch standard.
The primary advantage of foldable screens is their ability to expand screen size on conventional flat phones. So why have foldable screens not rapidly gained popularity like large-screen phones did in the past?
The high cost of large foldable screens makes them less accessible, while small foldables become fashion statements.
Currently, foldable phones come in two main types: large foldables - vertically folding screens (also known as book-style foldables); and small foldables - horizontally folding screens (also known as flip-style foldables), each facing their own challenges.
The earliest foldable phones to hit the market, like the Samsung Galaxy Fold and Huawei Mate X series, are large foldables. Their biggest advantage over traditional flat phones is clear to the naked eye - they offer a larger screen when unfolded.
However, they require high stability in the folding hinge, have high costs for flexible screens, and add an extra large screen compared to flat phones. According to Caijing, in the foldable screen industry chain, structural components (mainly hinges) and displays (flexible screens) account for 22% and 34% of the total cost respectively. Due to these cost constraints, the prices of large foldable phones have remained high.
In 2019, the Huawei Mate X started at 16,999 yuan, and with the release of the Mate X5 last year, the price dropped by 4,000 yuan but still remained high at 12,999 yuan. Similarly, Samsung's Galaxy Fold started at 15,999 yuan in 2019, and the latest model last year was priced at 12,999 yuan. In comparison, the highest price for the iPhone 15 Pro Max released during the same period was 13,999 yuan.
Samsung and Huawei have been the two largest players in the foldable screen market, holding 60.4% and 19.8% of the global market share in 2023, totaling 80% of the global foldable screen market. The high prices set by these major players indicate that large foldable screens are still far from being accessible to the average consumer.
The larger foldable phones are not without their drawbacks. For example, the OPPO Find N2 starts at 7999 yuan, and the Honor Magic V2 starts at 8999 yuan, but their "affordability" is only relative to Samsung and Huawei.
High prices and expensive repair costs are two major obstacles to making large foldable phones more accessible to the masses.
On the other hand, the prices of smaller foldable phones are much lower. The Nubia Flip, released in April this year, starts at only 2999 yuan, which is only about one-third to one-fourth of the price of large foldable phones. So why haven't these cheaper small foldable phones become popular?
Functionally, small foldable phones, due to their flip design, lack the advantage of a large screen that large foldable phones offer. The only notable functional aspect is that they are more compact when folded, making them easier to carry.
Therefore, small foldables are more like the flip phones of the past, with almost no functional differences from other phones, but they can showcase the user's taste and preferences. Nowadays, various manufacturers tacitly treat small foldables as fashion items, focusing on appearance design and brand marketing, making them more like fashion accessories rather than purely electronic products.
IDC China's senior analyst, Guo Tianxiang, also stated, "The usage scenarios for vertical foldable products have not been fully discovered yet. Products targeting 'fashionable young women' will directly compete with Apple."
In 2023, large foldable phones held a market share of 68.1% in China, while small foldable phones accounted for only about one-third. IDC analysis suggests that, besides portability, consumers still lack essential usage scenarios for vertical foldable products. At the same price point, the user experience is significantly different from that of traditional flat phones, and there is still considerable room for improvement in product quality.
Furthermore, whether large or small, foldable phones have their disadvantages compared to flat phones, such as screen creases, durability, and weight.
In conclusion, the main reasons why foldable phones are struggling to become mainstream are twofold: first, the current prices and after-sales costs of foldable phones are still relatively high, not yet hitting the sweet spot for consumers; second, foldable phones have not demonstrated unique advantages in functionality, leading users to lack the motivation to upgrade at higher prices.
The fate of foldable phones?
In fact, setting aside factors like price and after-sales service, consumers' acceptance of foldable screens is not low.
According to research by market research firm Counterpoint Research, in China, among smartphone users who have previously spent over $400, as many as 64% are considering foldable phones for their next purchase, with 20% already indicating they will buy a foldable phone, while another 44% are weighing between traditional and foldable phones.
Android users show a higher interest in foldable phones, reaching 71%, while the proportion among iOS users is 58%. Existing foldable phone users in the survey demonstrate a higher willingness to purchase foldable devices, with most of them keen on continuing to use this emerging form factor.
The survey also delves into consumer expectations for larger foldable phones. Around 70% of respondents believe that the weight of foldable phones should be similar to or lighter than their current smartphones. Regarding thickness, most respondents feel that the folded thickness of large foldable phones should not exceed 10-12 millimeters. Additionally, most users are willing to pay between 7000 to 8000 RMB for large foldable devices.
It is evident that at least in China, consumers have a high interest in foldable phones, and there is a considerable number of potential users for foldable devices.
TrendForce's analysis suggests that the future development of the foldable phone market depends on the speed of cost optimization. Key components such as UTG (Ultra-Thin Glass) and hinges may see mass production after standardization, effectively reducing costs.
Furthermore, the shipment of foldable panels from mainland panel factories is increasing, offering price advantages over Korean factories. This trend is expected to further decrease the cost of foldable phones, allowing brands to lower prices and accelerate market penetration.
In conclusion, the demand for foldable phones in the market is significant. However, due to the high cost associated with the unique product features of foldable screens, achieving widespread adoption has been challenging even after five years. Finding a large-scale, cost-effective commercial solution remains elusive, hindering widespread adoption.
On a positive note, similar to the past trend of large-screen phones, Apple is also exploring foldable screen products belatedly. Recently, analyst Ming-Chi Kuo from TF International Securities stated that Apple is expected to launch a foldable screen MacBook in 2026. However, the downside is that its cost may approach that of the current Vision Pro.
Nevertheless, as the only one among the top five global smartphone manufacturers yet to introduce a foldable phone, Apple's potential entry into the foldable phone market is poised to bring about new growth opportunities for the industry.
