You gotta know when to fold ’em
Apple’s taking a gamble on sticking with the slab design for its iPhone while Samsung and others seize the folding-screen high ground
It’s widely agreed, 16 years after the launch of Apple’s pioneering iPhone, that the smartphone is mature technology. The world is more interested in artificial intelligence now.
The annual updates to the iPhone or Samsung’s equivalent, the Galaxy S series, have become so incremental, so incredibly minor, that most consumers now choose to wait years between upgrades.
The upgrade cycle has slowed dramatically. The excitement of a decade ago is largely gone.
Yet Apple and Samsung appear to have radically different visions of the future. Samsung is betting big on foldables; Apple is not.
Apple, which has generated immense wealth from the iPhone making it the world’s most valuable company at $2.7-trillion has made only minor adjustments to the phone in recent years. You get a slightly improved processor here and a nip and tuck to the camera system there. And the same is true of the Galaxy S lineup.
Hardly revolutionary stuff. With the iPhone, Apple seems to be on cruise control. It still uses its highly polished keynote presentations to unveil minor updates as must-have upgrades. They’re not, and yet demand for the iPhone remains as high as ever this is still a hugely desirable device due to the maturity and convenience of the Apple ecosystem and the brand’s incredible cachet. Not tinkering too much with this formula makes a lot of sense financially. But has its phenomenal success made the company complacent? Has it dropped the ball by not venturing into foldables?
While Apple sticks with the phone-as-slab model, its rivals are investing heavily in foldingscreen technology.
While Apple has no foldables in its portfolio a folding iPad may be in the works Samsung will in the coming months unveil the fifth generation of its Galaxy Z Fold series. It’s fixed the teething troubles that bedevilled some earlier folding models, and it now leads a fast-growing market, with an estimated 62% share in the first half of 2022, according to Counterpoint Research.
Foldables are becoming a more common sight. In a world in which most phones look the same flat slabs of glass like the iPhone Samsung’s folding phones look well, refreshingly different.
And other Android phonemakers mostly Chinese brands such as Huawei, Xiaomi and Oppo are making big investments in the folding category too, betting the opportunity is huge. Just how big is open to question, but Google’s announcement last week of its first folding Pixel smartphone suggests momentum is building.
There’s no doubt that Apple, with its enormous research & development budget (a record $26.3bn in 2022), has folding iPhone prototypes in its labs. So, why haven’t we seen an iPhone Fold? The iPhone 15, expected in September, will again be a slab of glass; it will look like the iPhone 14 and the 13 before it, with some minor tweaks. Apple users tend to be exceptionally brand loyal defaulting to the iPhone when they upgrade but for how much longer?
The Android world is outpacing Apple in hardware innovation and has been for some time. Several of the iPhone’s newest features, for example variable and high screen-refresh rates, came to premium Android phones years ago. (Android phonemakers have also copied liberally from Apple over the years, some even cribbing things they really
shouldn’t, like Apple’s ugly iPhone notch, which, thankfully, it is now phasing out.)
One of the reasons for Apple’s success is that it is, by nature, a conservative company. It doesn’t take big risks. It takes what’s already in the market and “Apple-fies” it, masterfully combining software and hardware in a way that can be irresistible. Steve Jobs’s brilliance was to fix what was wrong with mobiles at the time — physical keyboards, tiny, low-resolution screens, awful software — and package the iPhone as a highly desirable product.
Without Jobs, is Apple at risk of missing the next wave in mobile computing? Could the company have become too cautious for its own good?
The numbers suggest Apple can still afford to bide its time on a folding iPhone. International Data Corp reckons folding smartphones won’t go mainstream any time soon.
In fact, the technology researcher said last October that even with expected compound annual growth of 38.7% — far higher than the rest of the market — foldables will make up just 2.8% of the smartphone market by 2026, up from 1.1% in 2022.
Volume shipments tell only a portion of the tale, though: foldables typically cost at least $1,000, putting them firmly in the iPhone Pro’s pricing tier. This is the premium end of the market, which in an important geography like the US really is Apple’s to lose.
Technology never stands still. Great fortunes have been made and lost in the tech sector over the years.
Remember BlackBerry? And Nokia? Jobs’s successor as CEO, Tim Cook, will be keenly aware of this. Apple can afford not to push iPhone innovation too hard for now.
But that won’t be the case forever. x