Folding screens are full of gunpowder smell! Leading mobile phone manufacturers launch a "card race"

The foldable screen mobile phone market is facing the most intense competition.

On September 8th, the new generation of small folding OPPO model OPPO Find N3 Flip was officially launched on all channels. The latest official data shows that the first sales of OPPO Find N3 Flip increased by 91% compared to the previous generation. Set a new record for the first day sales and sales volume of the industry's small folding.

According to research firm Counterpoint, OPPO's market share in the foldable screen market has reached 20% in the first half of the year. Under the watchful eye of Huawei and Samsung, OPPO won a 31% share of the small folding market in the first half of the year, ranking first in this segment.

Such achievements have obviously put pressure on Huawei in the high-end market. From the official announcement of the Mate 60 series to the unannounced pre-sale of the X5 foldable screen, the complete collision in time is somewhat mixed with gunpowder. With the launch of more foldable screen models, the industry believes that the foldable screen smartphone market will enter a more intense chase.

"The track of foldable screen smartphones will gradually differentiate, and the differences in category positioning will become more apparent. Large foldable phones are more targeted at business people, and product prices remain high. Small foldable phones are falling faster, and are even expected to enter the 4000 yuan range next year." Counterpoint analyst Archie Zhang told reporters that global foldable screen smartphone shipments are expected to double to 55 million units between 2022 and 2025, and the Chinese market has become the world's largest foldable screen smartphone market.

Folding screens are full of gunpowder smell

At the same time as the OPPO foldable screen Find N3 Flip saw its first sale, Huawei coincidentally launched the new member of the Pioneer Program, the Huawei Mate X5, on its official website. Huawei's executive director and CEO of terminal business, Yu Chengdong, wrote that "the strongest foldable screen phone still depends on Huawei.".

On August 29th, during OPPO's press conference, Huawei launched the Mate 60 series on its official website, attracting a wave of popularity. "Did Huawei and OPPO get into a fight?" once became a hot topic on Weibo, and various humorous images and texts filled the internet also gave the protagonist to Huawei and OPPO.

According to IDC data, OPPO released the first generation foldable screen phone Find N in 2021, which later became the second largest foldable screen market in China in the first half of 2022 with an 18.3% market share, second only to Huawei. In 2022, OPPO released the second-generation foldable phone Find N2 and Find N2 Flip, elevating them to the top spot in the foldable screen market share in the first quarter of 2023, with both models having a market share of 35.0%.

This has put pressure on Huawei, which has been the top seller of foldable screens for many years. The public opinion trends such as "Wang Feng in the entertainment industry", "Playing Apple sounds like playing OPPO", and "The release time depends on the almanac" even sent OPPO directly to the stage of confrontation with Huawei. In the past, it seemed that only Apple was seen as a competitor by Huawei.

"OPPO focuses on fashion and female users, and emphasizes fashion elements in product accessory design. The product design and positioning are very distinct. Huawei is also a major player in the foldable screen market, and the overall size of the foldable screen market in the later stage still depends on Huawei's product release pace, density, and price trends." Archie Zhang told reporters.

In his view, long-term preparation and reckless R&D investment have opened up a gap in high-end foldable screens for OPPO. "The main reason why small foldable screens are recognized by the market is twofold: on the one hand, the price is relatively large and the foldable screens are cheap; on the other hand, the product form is novel and the user experience is similar to that of current straight panel smartphones. At the same time, the entire foldable screen track is mainly driven by small foldable products, with overall sales higher than large foldable screens," said Archie Zhang.

OPPO product manager Zhou Yibao once stated in an interview with reporters that in the four years starting from 2018, OPPO has iterated through six generations of folding schemes, basically exhausting all folding schemes. In January 2021, OPPO only launched the first generation of folding screen phones. "OPPO's three-year foldable screen smartphone strategy is very clear, with two generations achieving a break even point and three generations selling over a million units, establishing a stable high-end market."

Archie Zhang stated that from the current competitive landscape, Huawei, Samsung, and OPPO are all major market leaders, with the highest proportion of models in the best-selling foldable screen smartphones in China. OPPO and Huawei monopolized the top five best-selling foldable phone models in China from January to May 2023, with the top five models accounting for 76% of the overall foldable screen market sales in China.

In the future, with the release of more foldable screen models from manufacturers such as Honor, Xiaomi, and Vivo, this track will enter a more intense competition stage and extend from domestic to overseas.

According to Counterpoint data, Huawei will launch the Huawei Mate X3 in multiple markets in Central and Eastern Africa and Europe. OPPO has also launched foldable screen products in regions such as Western Europe, Southeast Asia, Central and Eastern Africa, Latin America, and South Asia. The overseas expansion plans for vivo and Xiaomi's foldable screen products are expected to be in progress. Honor has previously released its first external foldable screen concept smartphone, V Purse, in Europe.

"At present, the world's largest foldable screen smartphone markets are China, North America, Europe, and South Korea, accounting for more than 80% of the global market in 2022." Archie Zhang said that China's foldable screen shipment share jumped to the top with 26% share, achieving a year-on-year increase of 199% in shipment volume in 2022. It is expected that Chinese smartphone brands will further seize more market share through overseas expansion.

Mature supply chain drives foldable screen smartphones to enter overseas markets

From the layout nodes of major mobile phone manufacturers, the R&D investment in the field of foldable screens has been extended to a three-year or even four-year cycle. Although domestic smartphones may not be able to compete with Apple in the high-end market in the short term, Chinese smartphone manufacturers are gradually improving their domestic foldable screen supply chain ecosystem based on their technological reserves and capabilities in the supply chain.

According to data provided by data agency Wisdom Sprout to reporters, the top four domestic mobile phone companies "Huami OV" and its affiliated companies mainly focus on flexible screens, mobile terminals, rotary connections, shell components and other related fields in the field of foldable screen technology.

In terms of technological development direction, Qunzhi Consulting believes that folding technology is gradually accelerating from mobile phones to medium size, and the technological form is developing towards multi folding, scroll and other directions.

"The difficulty of the supply chain lies not in whether foldable screens can be made, but in making them better. Firstly, it is necessary to focus on reliability and durability, and domestic ultra-thin glass cover plates need to be improved. Secondly, it is about lightness and thinness, involving various links such as cameras, batteries, and hinges." Chen Jun, Deputy General Manager and Chief Analyst of Qunzhi Consulting, told reporters.

In the view of analysis institutions, foldable screen smartphones have undergone several years of development and are driving technological upgrades in the upstream and midstream supply chains. Through market-oriented iterations, they are gradually advancing updates in materials and other fields, thereby reducing the cost of core components and feeding back downstream markets, driving market explosions.

"China has established the world's most complete intelligent hardware supply system, with a gathering of component suppliers." Archie Zhang told reporters that Chinese suppliers are leading the world in multiple fields such as display screens, hinges, imaging and camera modules, batteries and fast charging, and advanced sensors. Most of the materials and components required for producing smartphones can be purchased locally, either from local Chinese suppliers or from Chinese factories of international suppliers.

Counterpoint stated that in the field of foldable screen smartphones, leading global hinge suppliers such as Amphenol, Jingyan Technology, AVC, and Corson Technology have deployed research and manufacturing centers in multiple cities in China. Based on the advanced technology of Chinese smartphone manufacturers in manufacturing complex terminal products, they have already achieved certain advantages in the development of the global foldable screen industry from a technological perspective.

This also provides a foundation for Chinese mobile phone manufacturers to compete with foldable screens overseas.

At present, the world's largest foldable screen mobile phone markets are China, North America, Europe, and South Korea, accounting for more than 80% of the global market in 2022. China ranks first, while North America is the world's second largest foldable screen market in 2022, with a 21% share and a year-on-year increase of 47%. On the other hand, the market share of South Korea and Europe has declined in 2022. Although Latin America and the Asia Pacific region have relatively small market shares, their growth rates in 2022 rank second and third respectively.

Among them, in the Asia Pacific region, ASEAN is expected to become an important growth area for the global foldable screen market. In terms of population structure, the median age of ASEAN is about 30 years old, and developed networks and infrastructure are also a guarantee of its purchasing power.

Archie Zhang told reporters that several Chinese brands have temporarily emerged in the ASEAN market. "Chinese brands are rapidly seizing market share in this market, accounting for nearly 60% of the region's smartphone sales by 2022. OPPO entered the ASEAN market in 2012, while Xiaomi and vivo entered in 2014."

However, in the long run, in order to challenge Samsung's position in the foldable screen market in the global market, Chinese manufacturers still need to continuously invest in technology to overcome market challenges. At present, foldable screens still have room for improvement in terms of phone weight, battery life, screen creases, and application ecology.

Counterpoint predicts that the next generation of foldable screen smartphones will be high-performance productivity terminals, with enhancing human-machine interaction and improving work efficiency being the current focus of the supply chain.

"The next generation of horizontally folding screen smartphones will bring a smarter and more efficient human-computer interaction experience, providing users with more personalized and free split screen combinations in various application scenarios. The operating system will meet the needs of consumers to quickly switch work modes in different scenarios, such as document editing, image and video editing, and financial work operations." Archie Zhang said.