Why Apple’s foldable iPhone creates dilemma for Samsung

As Apple's foldable iPhone development gains momentum, Samsung Electronics finds itself facing more complex strategic situations.

For Samsung, which has led the foldable smartphone market so far, the US archrival's entry represents both an opportunity to expand the market and the prospect of fierce competition over market share. For its sister firm Samsung Display, expectations are rising as it is set to exclusively supply foldable panels to Apple.

According to industry sources on Wednesday, Apple is currently developing a foldable iPhone with a target launch date set for next year. The device is expected to resemble Samsung’s Galaxy Z Fold series, featuring a 7.8-inch main display -- comparable to an iPad Mini when unfolded -- and a 5.5-inch cover display, similar in size to the iPhone 13 Mini.

When folded, the device is projected to be 9.2 millimeters thick, slimming down to 4.6 millimeters when opened, thinner than Samsung’s latest Galaxy Z Fold 6, which measures 5.6 millimeters when unfolded.

Since the world’s first commercialization of a foldable smartphone in 2019, Samsung has led the market with its Galaxy Z Fold and Galaxy Z Flip series, firmly establishing itself in the premium smartphone segment. As of last year, the tech giant maintained a commanding global foldable market share of about 60 percent.

However, the competitive landscape is shifting as Chinese manufacturers such as Huawei, Oppo, and Vivo rapidly narrow the technological gap. With Apple’s loyal customer base poised to embrace the new form factor, market competition is expected to intensify sharply next year.

Apple’s anticipated entry could serve as a catalyst for the mass adoption of foldable smartphones, a segment that has so far remained a premium niche. The US tech giant's participation will likely expand consumer interest beyond early adopters and push foldables closer to the mainstream smartphone market.

Samsung Display stands out as the potential biggest beneficiary. The company has reportedly been selected as the exclusive supplier of foldable OLED panels for Apple’s upcoming device, according to tech media outlet Apple Insider.

The report highlighted that Apple was particularly impressed by Samsung Display’s technological superiority in minimizing screen creases, a crucial quality factor for foldable devices.

Notably, the collaboration marks a departure from Apple’s traditional multivendor sourcing strategy. Historically, Apple has diversified its display panel suppliers across Samsung Display, LG Display and China's BOE. In opting for Samsung Display as its sole partner for foldable panels, Apple underscores the Korean firm's unique mass production capabilities and expertise.

Since supplying panels for Samsung’s first foldable phone in 2019, Samsung Display has maintained its position as the global leader in foldable OLED production. Its market share reached a remarkable 84 percent in 2022. Although Chinese competitors have recently gained ground, Samsung Display still commands a dominant 50 to 60 percent share of the global foldable panel market.

“While Apple’s entry will heighten competition among manufacturers, it will also expand choices for consumers and inject fresh vitality into the market as a whole,” said an industry official, who requested anonymity.

“For Samsung Electronics, defending smartphone market share will be a pressing challenge, but in terms of displays, securing Apple as a major customer offers an opportunity to diversify revenue streams (for Samsung Display),” the official added.

According to Taiwan-based market analyst firm TrendForce, global shipments of foldable phones totaled 17.8 million units last year, accounting for 1.5 percent of the total smartphone market. By 2028, foldables are projected to capture 4.8 percent of the overall smartphone market.