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Is the Future Foldable Smartphones? Where Does That Leave Apple?

At MWC 2019, folding smartphones and 5G were building buzz, but AAPL is expected to lack both features in its 2019 iPhones

The world’s top smartphone makers — with the exception of Apple (NASDAQ:AAPL) — are showing off their latest models at Mobile World Congress (MWC) 2019. Folding smartphones are emerging as a real trend, the new premium flagship option. Samsung has one, Huawei has one, and other smartphone makers are showing off folding smartphone prototypes. And 5G was everywhere.

Source: Huawei
 So where does that leave Apple, the company whose iPhone used to be the trendsetter among flagship smartphones?

And what does this mean for AAPL’s current strategy of ultra-premium pricing to drive up ASP to make up for slowing unit sales?

The Folding Smartphone Trend at MWC 2019

To be fair, the whole folding smartphone kick actually started got underway before MWC 2019. Samsung had hinted at a folding smartphone for months and officially unveiled the $1,980 Galaxy Fold at its Unpacked event last week. And late last year, Royale was showing up its $1,318 FlexPai folding smartphone.

But MWC proved that the flexible display, folding design isn’t a one-off marketing ploy. Huawei wowed attendees and the press with its Mate X. This folding smartphone will be available mid-year and is priced at an eye-watering $2,600. And it impressed anyone who was able to get hands-on with it. The Verge’s take was “I held the future in my hands, and it was foldable.

While the Huawei Mate X has turned into the star of the show, there were other manufacturers showing off folding smartphone prototypes. China’s Oppo was showing off images of its own folding smartphone. TCL — the company that smartphones with the BlackBerry (NYSE:BB) brand — had an early stage folding prototype at the show. LG also had a take on the folding smartphone. instead of a single, flexible display, its V50 smartphone has an optional folio case with a second OLED display inside that pairs with the smartphone. You end up with two 6-inch displays side by side, joined by a hinge.

Patent for a Folding iPhone

Apple doesn’t have a folding iPhone and there have been no rumors of the company actively working on one. So far as we know, the closest it’s come is a patent filing for a folding iPhone design that was filed several weeks ago…

And Then There’s 5G…

Adding to Apple’s problems is 5G. The next generation cellular service is not going to be fully deployed by wireless carriers this year. Far from it. But that hasn’t stopped 5G support in smartphones from becoming another big bragging point at MWC. And both the Samsung Galaxy Fold and Huawei Mate X folding smartphones also offer 5G support.

Apple appears to be left out in the cold on this one as well. Its legal war with Qualcomm (NASDAQ:QCOM) means Apple is stuck with Intel (NASDAQ:INTC) modems for its iPhones — at least until it can design its own. And that means no 5G support for the iPhone in 2019…

Apple doesn’t participate in Mobile World Congress, so its absence was nothing unusual. However, this year there was a definite feeling that instead of all these Android smartphone makers chasing the latest iPhone design, they have leapfrogged Apple. 

2020 could be a tough year for the company. When its new iPhones are unveiled in September, they are going to be lacking two very prominent capabilities its primary competitors have been pushing: a folding display, and 5G capability.

AAPL kicked off the era of escalating smartphone prices in 2017, with the $999 iPhone X. The big question for Apple and its investors is whether consumers will continue to tolerate ultra-premium pricing for a smartphone that may seem to be out of date compared to the competition.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media, https://investorplace.com/2019/02/is-the-future-foldable-smartphones-where-does-that-leave-apple/.

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