Foldable and iPhone Coming... Domestic Smartphone Market Expected to Grow 3.7% in Second Half of the Year

[Asia Economy Reporter Seulgina Cho] The domestic smartphone market, which recorded a decline in the first half of the year, is expected to rebound in the second half.

According to market research firm Korea IDC on the 10th, the domestic smartphone shipment volume in the second half is estimated to reach 8,551,000 units due to the release of foldable phones and major flagship models. This represents a 3.7% growth compared to the same period last year.

Recently, expectations for a return to daily life following COVID-19 vaccinations have increased, and consumer sentiment, which had been frozen, is recovering. Additionally, major manufacturers such as Samsung Electronics, Apple, and Xiaomi are continuing to release flagship models in the second half.

Samsung Electronics, instead of releasing the 'Galaxy Note' series, which is usually launched every year in the second half, unveiled the 'Galaxy Z Flip3' and 'Galaxy Z Fold3' last month. The launch of the 'Galaxy S21 Fan Edition (FE)' is also anticipated. Apple is also expected to hold an event next week to introduce the iPhone 13.

Korea IDC stated, "In the second half, smartphone companies will continue the sales momentum of premium lineups led by foldable phone series," adding, "By strengthening the 5G mid-to-low-end model lineup targeting price-sensitive users, they will satisfy the demands of various consumers and promote smartphone consumption."

The domestic smartphone shipment volume in the first half was about 8.56 million units, a 3% decrease compared to the same period last year. Although the decline continued, its extent was mitigated. Despite increased uncertainty due to LG Electronics' mobile business closure, the negative impact seems to have been somewhat alleviated thanks to early releases of major products.

In the first half, major flagship models showed strong sales. The market share of premium products priced above 800 USD was 52.3%, a significant increase from 31.0% in the same period last year. This is analyzed to be due to demand for device replacement cycles returning for the first time since the launch of the first 5G smartphone two years ago. Some 5G models were priced below 600 USD, satisfying consumers who prioritize cost-effectiveness.

Jihae Kang, a researcher at Korea IDC, said, "Foldable phones will invigorate the smartphone market in the second half of this year," and added, "Along with manufacturers strengthening channels in response to increased unlocked phone demand and the expansion of affordable 5G plans by telecom carriers and MVNOs (Mobile Virtual Network Operators), the somewhat slowed transition to 5G will also recover."