Yahoo Finance The future of mobile phones is foldable, Samsung says
Samsung’s latest smartphone, the Galaxy Z Fold2, is about to go on sale, and it indicates the company’s commitment to a new kind of device: The folding phone.
When I talked to Samsung’s Conor Pierce, it was a topic he returned to repeatedly. Samsung’s corporate vice president for UK and Ireland knows his phones, having spent 10 years at Nokia and Microsoft working on some of their key Windows Phones handsets.
We talk – on video call, of course – and he is animated about the work Samsung is doing. He refers modestly to the team’s successes, rather than his own, and he is friendly and at ease – but don’t let that fool you. I have never spoken to a senior exec more au fait with the facts and figures, as he quotes another percentage or number relevant to the story.
And the story is one of a company which still sells more phones than anyone else, but is reluctant to sit on its achievements. In the last few weeks, the Galaxy Note 20 and Galaxy Note 20 Ultra phones have been unveiled alongside a new tablet, new smartwatch and true-wireless earbuds that are shaped like kidney beans (but are better at transmitting music to your ears than actual legumes).
The new Galaxy Z Fold2 has a complicated name: Z refers to Samsung’s folding phones, and Fold2 indicates it’s the sequel to last year’s Fold which had an uneven start. It was delayed after announcement when reviewers removed a screen protector that should have stayed in place and dirt got underneath, causing problems. The Fold and Fold 2 are both small tablets which fold in half to become phones.
In between was the company’s second folding phone, the Z Flip, which was a regular-sized phone that folded down into something more pocketable. It’s a great phone, but it felt a little fragile, that you needed to handle it with care. The Z Fold2, however, feels solid and robust.
“The engineering hours that go into building a folding device is phenomenal,” Pierce says. “Some of the changes that we've made from the original Fold last year are very appealing for customers. There’s now a full screen display on the front cover and the hinge mechanism is changed as well. The engineers added a hideaway hinge so that you can actually change the angle and leave it in place so you can watch a movie as it sits down. They've also introduced a new sweeper technology which ensures that we don't get particles embedded within the hinge – it's a huge amount of engineering genius that goes into these devices.”
There’s no doubting the designers’ intention to create something high-end. In Samsung’s elegant Mystic Bronze finish, the Galaxy Z Fold2 looks more like a piece of jewellery than a phone, made to the same critical tolerances as a deluxe watch. But the fact that it’s designed to fold in half makes it thicker, when folded, than other phones. So, will customers really embrace folding handsets?
“We all know how important our phones are, but I think Covid may have made them even more important. We've all had to adapt to a new way of living and working, and technology has certainly become more of a vital thread that maintains human interaction despite the restrictions that we all have to endure. But it also empowers people to explore and interact in new ways. People used to ask why you would want a large-screen phone and now we know everyone wants that whether for productivity, gaming or entertainment. As we are being forced to work remotely, I think the large-screen format is becoming even more important.”
Obviously, the advantage of a folding phone is that it offers a huge screen when open – in the case of the Galaxy Z Fold2 it’s 7.6 inches – but takes up much less space when closed. Pierce says that customer research has shown a real interest in folding phones. “We need to be very cognizant of consumer trends, but we also need to lead, to show what this technology can do. Fold is a brand-new experience for people and it’s letting people multi-task like never before. With a standard smartphone you tend not to multitask because the real estate is too small, but with this large screen opened, about a third of those using a folding phone are using two apps at the same time. We also know from the research in the UK that for those who are using a folding phone there’s a 71 per cent increase in the video consumption and 35 per cent increase in gaming.”
But Pierce says the appeal of the fold is not limited to gamers. “About a third of those who are purchasing a Galaxy folding device are coming from our competition. There’s definitely an appetite among premium iPhone users to try something new. It’s a beautiful device in its own right but it’s also addressing some of the issues they may be have with their existing device. It’s 5G, for a start, so it’s future-proofed.”
There’s no such thing as a 5G iPhone, and Pierce thinks this is important. He says that in the UK, Samsung has over 90 per cent market share of 5G handsets. Although the 5G market is growing slowly – he says it was less than 2 per cent of the market by volume last year and expected to be 10 per cent this year – Samsung’s advantage has been important.
But Apple is expected to launch its first 5G iPhone in the next few weeks. So, how does he plan to fight back against such a challenge? “The more competition there is raises the entire awareness of the market. We've been doing the heavy lifting on 5G more or less by ourselves for the last year, so it'll be nice to welcome a competitor, finally. I think it certainly will bring a lot of energy to the market, it will raise the profile of 5G and of course it’ll put pressure on us and I've no problem with that, I like a good fight. But I think at the end of the day, it's not about fighting our competitor, it's about making sure that we focus on what's important and that's the consumer.
“I think the tide will raise on 5G later this year and it's incumbent on us to leverage the leadership that we have currently.”
The Samsung Galaxy Z Fold2 is an expensive phone – £1,799 – so definitely not for everybody’s pocket. But is that what folding phones will remain, premium handsets for the top end of the market or will they one day be ubiquitous?
“We’ve found that 70 per cent of consumers even today would consider purchasing a foldable device in the future, so it's very encouraging. I think people really aspire to move into that form factor. At the moment, of course it's a premium device because of its cutting-edge technology. Having said that, though, yes, I do believe in time foldables will filter down into the portfolio. Over what time, I don't know but I think it's definitely a huge part of the market, not just for Samsung. Obviously, we're at the beginning of this journey but looking at the uptake and reactions of those who actually enjoy the purchase of their Fold I think it's very encouraging. I do believe that the Fold plays where the puck is going to be.”
How much will Samsung’s early arrival in the market help the company? Pierce pauses and says, “It's a new category that we have the opportunity to define, build, own and lead. There are some really interesting trends. Mobile screen time is about to pass close-quarter screen time, that’s regular TV. And I do think that productivity has changed, especially due to Covid now we're forced to work remotely but the trend is there anyway. People were looking for more work-life balance, so being able to use your Fold in a productive environment is beneficial. That's what I use it for actually. If I don’t have my laptop to hand, I just open up my Fold on full screen and that can be my office in its own right.”
This year seems to be more about raising awareness of folding phones. I’d say that the Fold2 is a highly impressive device, with supermodel looks and a dazzling screen. Pierce will be hoping that as prices drop and folding phones become more commonplace, that Samsung can maintain its dominance of the sector as it grows.
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Galaxy Z Fold 2: Samsung introduces $2,000 folding smartphone