"Will the Market Recover?" Galaxy 'Online Unpacked'... Samsung's Deep Concerns

The scene from Samsung Electronics' Galaxy Unpacked event last February

[Asia Economy Reporter Seulgina Cho] "Sales are extremely poor." With just over two months left until the 'Galaxy Unpacked' event unveiling the second half's flagship smartphones, Samsung Electronics is facing deep concerns. The Galaxy S20 series, which was spectacularly introduced at the beginning of the year with ambitions to open a new decade, has been hit hard by the COVID-19 pandemic, leaving it in a position to be remembered as an 'ill-fated masterpiece.'

As the Galaxy S20 failed to meet its initial sales targets, expectations for the second half's flagship smartphones have grown. However, with the economic recovery uncertain due to COVID-19, there is complexity regarding the launch timing. Options such as unveiling the new flagship smartphone at the August Unpacked event but postponing the official release until the end of the year, similar to Apple's iPhone strategy, are also being considered.

◆Flagships Launching One After Another= According to industry sources on the 9th, Samsung Electronics' second half flagship smartphones, including the 'Galaxy Note20' and the new foldable phone 'Galaxy Fold2,' will be unveiled online in early August. A Samsung Electronics official stated, "We are considering holding the second half Unpacked event online on August 5," adding, "The exact schedule may vary by a day or two depending on circumstances."

Samsung Electronics traditionally held its Unpacked event in New York every August, but this year, due to the spread of COVID-19 and concurrent protests against racial discrimination, the event will be held online. At this event, not only the Galaxy Note20 but also the next foldable phone Galaxy Fold2, the 'Galaxy Z Flip 5G' version, and the next-generation smartwatch 'Galaxy Watch3' equipped with electrocardiogram measurement functions are expected to be unveiled together.

Samsung Electronics aims to reverse the mood by introducing a series of strategic products at the second half Unpacked event. After the Galaxy S20's sales fell short of expectations, mid-range products like the A series were launched consecutively, but this alone was deemed insufficient. To avoid being overwhelmed by Chinese brands emphasizing price competitiveness, Samsung must widen the gap with high-profit flagship models in the North American and European markets.

It is also painful that the Galaxy S20, tagged as an 'ill-fated masterpiece,' was the representative Samsung smartphone this year. Initially, Samsung Electronics was confident in selling up to 40 million units of the Galaxy S20 this year, but actual sales are expected to be less than half. According to market research firm Omdia, shipments of the Galaxy S20 series in the first quarter (January to March) were only 8.2 million units.

An industry insider pointed out, "Even if sales of mid-range models increase, concerns about cannibalization cannot be avoided," adding, "With Apple's first 5G iPhone launch and the pursuit by Chinese brands like Huawei, Samsung Electronics' concerns are inevitably deepening."

◆Deliberation on Launch Timing... Hope for Recovery= Samsung Electronics' new smartphones, including the Galaxy Note20, are expected to be unveiled at the August Unpacked event and released globally from late August. However, Samsung is likely to carefully consider the release timing for each detailed model, as it needs to closely monitor the recovery trend in the second half smartphone market. Market research firm Strategy Analytics (SA) forecasts that global smartphone shipments will shrink by 25% compared to initial projections this year.

Industry insiders expect Samsung to attempt to capture the market ahead of Apple's first 5G smartphone, the iPhone 12, but to delay the release as much as possible. There is also speculation that Samsung might stagger the release, similar to Apple unveiling the iPhone X in September 2017 but starting actual sales in November.

The Galaxy Note20 series to be unveiled this time is likely to include two models: the Galaxy Note20 and the Galaxy Note20 Plus (Ultra). The base model is expected to have a 6.7-inch screen, and the Plus model a 6.9-inch screen. The Galaxy Fold2 will have larger internal and external screens than the first foldable phone, the Galaxy Fold. When folded, it is expected to have a 6-inch screen, and when unfolded, a screen in the high 7-inch range. Waterproof and dustproof features will be newly applied, and there is speculation that an S Pen will be included. If so, the Galaxy Fold2 will be the first Samsung foldable phone with waterproof and dustproof capabilities. The new smartwatch, Galaxy Watch3, is expected to be equipped with electrocardiogram and blood pressure measurement functions.