Phones Are Coming Down, Budget Models Flood the Market

[Asia Economy Reporter Joesulgina] Performance has been enhanced while prices have been lowered. Samsung Electronics and Apple are clashing again in the first half of this year in the budget smartphone market emphasizing "cost-effectiveness." From Apple's iPhone SE Plus, whose release was initially uncertain, to Samsung's mid-range A series such as the Galaxy A52 and Galaxy A72, a lineup is waiting to be launched one after another.

According to related industries on the 22nd, Samsung Electronics revealed the Galaxy A12, its first mid-range model of the year, earlier this month, and plans to release the Galaxy A52 and Galaxy A72 in Europe, India, and also introduce them domestically soon. Since budget products with lowered prices and improved performance are gaining consumer approval, this move aims to strengthen competitiveness through the new lineup.

In particular, the A series released in the first half of the year is equipped with waterproof and dustproof features and a 90Hz high refresh rate, which had previously only been installed in flagship models. It is the first time in three years that Samsung supports waterproof and dustproof functions in mid-range phones. This is also the first time the A series has a refresh rate exceeding 60Hz. Samsung plans to fill the flagship phone gap from the Galaxy S21 launch in January until the second half unpack event with these products and solidify its position in the mid-range phone market. The expected prices are around 500,000 KRW for the Galaxy A52 and 600,000 to 700,000 KRW for the Galaxy A72.

Apple, which has maintained a premium strategy, is also expected to unveil a successor to the 500,000 KRW iPhone SE released last year within this year. Major IT foreign media such as MacRumors reported that Apple will launch the iPhone SE Plus in the first half of the year. It is known to feature a wider 6.1-inch LCD display and a premium-grade Apple application processor (AP) compared to its predecessor. LG Electronics, which is considering withdrawing from the smartphone business, recently had renderings of the LG W41 model leaked, leading to speculation that its last released product will be a budget W series rather than a rollable phone.

The reason manufacturers are strengthening their budget lineups like this is based on the judgment that the replacement cycle for smartphones is getting longer and the growth of premium smartphones has somewhat stagnated. According to market research firm Strategy Analytics (SA), the global smartphone replacement cycle last year was 3 years and 7 months, which is 3 months longer than the previous year.

In the domestic smartphone market, which was centered on high-priced flagship phones, the popularity of budget models emphasizing cost-effectiveness is also increasing. Due to the impact of COVID-19 and other factors, the share of smartphones priced below 400,000 KRW rose from 34% in 2019 to 41% last year. The best-selling smartphone in the domestic market last year was also a mid-range model, the Galaxy A31.