The Korean smartphone market is dominated by three major players – Samsung, Apple and LG. Out of the three, Samsung has a majority market share of close to 60%, whereas Apple and LG hover close to 20%. Since 2016, except 2017 (due to Galaxy Note 7 fiasco), the Galaxy S and Note series sales have been more than other devices during the first quarter period. But that changed in Q1 2020, with an “affordable premium” Galaxy A90 5G emerging as the best-seller in Korea.
Source: Counterpoint Model Sales Tracker
A non-ultra-premium smartphone taking a top spot is a significant event that signals changing consumer needs. The COVID-19 impact could be one of the reasons why we are seeing this shift. The “affordable premium” smartphones bring top-of-the-line hardware along with flagship features without creating a hole in your pocket. The Q1 2020 best-seller in Korea, the Galaxy A90 5G, comes equipped with Qualcomm’s flagship Snapdragon 855 SoC, triple cameras and next-gen 5G connectivity with an ASP of $453.
Source: Counterpoint Model Sales Tracker
In the latest episode, “The Counterpoint Podcast” host Peter Richardson and research analyst Minsoo Kang discuss the rise in popularity of “affordable premium” smartphones in the Korean market. The discussion also touches upon other launches such as the Apple iPhone SE, LG Velvet, and a look at overall best-selling phones in Korea, and more.
Samsung’s recently launched Galaxy S20 series reveals several key camera trends we are likely to see for premium smartphones this year. They include large image sensors, powerful optical zoom functionality, 108MP sensors and advanced camera array setups.
Big on image sensors
Image sensors are semiconductors that convert light coming through a lens to a digital signal. These sensors are the major element determining an image’s quality and the number of pixels. Hence, the image sensor’s size is critical to how much detail can be captured from a given shot.
The Galaxy S20 Ultra has a 1/1.33-inch image sensor, larger than in some compact DSLRs (typically 1/2.00-inch – 1/1.70-inch), and we expect competition here to intensify. In the short term, Chinese brands like Huawei, Xiaomi, and OPPO will continue to introduce larger sensors. Huawei P40 Pro Plus already has a 1/1.28-inch sensor but is not available outside of China.
Image sensor size – a rising trend
Source: Counterpoint Research
Hybrid optical the emerging battlefield in zoom
Digital zoom has typically been used in smartphones to enlarge images, but a major issue has been image loss. To overcome this, optical zoom features have increasingly been introduced since 2016 which utilizes multiple lenses. The Galaxy S20 is Samsung’s culmination of these efforts, and its 103mm telephoto lens now rivals those found in DSLRs (100mm-300mm).
Optical zoom by key flagship model
Source: Counterpoint Research
The Galaxy S20 Ultra uses a combination of multiple lenses (referred to as a folded or ‘periscope’ lens) to offer 4X optical zoom, then deploys a “hybrid-optic” 5X-10X zoom function with lossless image by using a combination of sensor cropping and binning technology along with AI multi-frame processing. We recently put the Galaxy S20 Ultra’s cameras through the paces and results are impressive.
This year, we expect competition in high-resolution optical or hybrid optical zoom with lossless image to intensify, with broad adoption of periscope lenses across many flagship models. To enhance lossless zoom, we also expect OEMs to continue with multiple (four to five) sensor implementations.
Linear camera lens array setup
A camera’s lens setup has a significant impact on overall smartphone design. There are various array setups including circular, square, triangle, and linear, with the latter two being most common.
Main camera lens array setups
Source: Counterpoint Research
Triangle arrays enable quicker image processing as each lens is equidistant to the subject, requiring less processing as the camera switches from lens to lens. Linear arrays provide faster auto-focusing functions by distance measurement based on the difference of images captured by two or more lenses.
With the increasing adoption of ‘periscope lenses’ in premium devices, we expect linear arrays to dominate as they are necessary components of the periscope-based camera platform.
Rising camera module BOM costs
With the camera being one of the most competitive elements of premium smartphones, camera component costs have been rising continuously and we expect its share of BOM to increase in 2020. The Galaxy S20 Ultra has one of the costliest camera setups in a smartphone. It accounts for 21% of the total BOM, after the system-on-chip (Snapdragon 865 or Exynos 990) along with the 5G (X55 5G or Exynos 5G 5123) baseband.
The ability of an OEM to control production costs for camera modules will play a critical role in securing competitive advantage, especially in the 2020 environment where consumer price sensitivity is likely to be higher than normal.
Ratio of camera modules costs within the smartphone BOM continues to rise
Source: Counterpoint Research
Hybrid Optical Zoom to See a Wider Adoption
2020 started with the Galaxy S20 series offering hybrid optical zoom capabilities, and the same can be expected with the flagship Galaxy Note series later this year. The feature could also make its way to some A-series smartphones. Besides Samsung, Huawei with its P40 Pro series and Oppo with Find X2 Pro has also introduced hybrid zoom feature. We are expecting more OEMs to embrace a periscope style lens to include hybrid optical zoom capabilities on the upcoming premium smartphones.
Samsung Unpacked 2020 event had lots of energy and hardware announcements. In an era where it is very difficult to differentiate, Samsung did an admirable job, unveiling four smartphones and updated Galaxy Buds. It was the first Unpacked event for President & Head of Mobile Communications Business, TM Roh.
Here are the key announcements from the event:
A New Folding Galaxy:
The event was kicked-off by the elegant Z Flip. It is a radical change from the Galaxy Fold which closed in a ‘book’ format. The Z Flip is a clam-shell foldable. The device is compact, symmetrical, and the first square smartphone since the Nokia 7705 Twist. The device uses ultra-thin glass that folds, according to Samsung, over 200,000 times without stress lines. The clamshell and design are a superior form factor than last year’s ‘book’ fold and Samsung did a much better job protecting the display as it is more recessed. The hideaway hinge is a unique implementation that allows the display angle to be less severe.
The Z Flip has some useful multi-tasking capabilities. Users will get YouTube premium included–a nice enticement. This is not yet a high-volume device. It is $1,380 and it is not 5G-capable. However, each iteration is seeing massive improvements, and this form factor is the future.
S20, S20+, S20 Ultra:
The first Galaxy S launched in 2010—a full decade of Galaxy devices have ensued. The S20 is a sizable upgrade for the new decade. Samsung unveiled three smartphones focusing on camera technology, AI, and 5G.
Key selling points of the S20 family–choose your display size. Display sizes are 6.2 inches for the S20, 6.7 inches for the S20+, and 6.9 inches for the S20 Ultra. The OLEDs are bright, vibrant, and support 120Hz. The S20 feels ‘compact’ relative its brothers and can actually be used with one hand. The S20+ and S20 Ultra, because of the near edge-to-edge display and thinness, feel smaller than 6.7 inches and 6.9 inches.
Camera capabilities are the sexy headlines. First, the device can shoot, share, and view 8k video. It is also possible to crop a single frame from a video. The megapixel wars are back! The Ultra sports a 12MP, 48MP, and a 108MP (ultra-wide angle, telephoto, wide angle). Under the branding name, “space zoom”, the camera configuration can magnify up to 100x. Yes, after 50x it becomes pixelated, but what a feat within the thinness of a phone to have binocular-like zoom.
Not as sexy, but the best utility is ‘single take’. The camera takes multiple shots, chooses the best filters, and the shooter can confirm it is their favorite. The automation is key.
Other key launch day notes:
5G use cases were rare, but video calls with Google Duo will suffice.
Remember the early LTE smartphones and their battery performances? Not to fear. These are day-long batteries at 4,000mAh, 4,500mAh and 5,000mAh.
All the devices are run by Qualcomm’s Snapdragon 865. Samsung also chose Qualcomm’s X55 modem as well as Qualcomm’s ultrasonic fingerprint sensor. In countries where mmWave is needed, Qualcomm’s QTM527 modules are used.
LPDDR5 16GB of RAM—this will be utilized for machine learning capabilities. Samsung states it is 30% faster getting data. We will have to trust Samsung for now.
1.5TB of storage is available. This is not overkill considering the S20-series can shoot, store, and play 8k videos. New stabilizer tech will help 8k video smoothness.
Galaxy Buds+
Galaxy Buds+ were unveiled starting at $149.The improvements include an additional mic for improved ambient sounds—there are now three mics. The update Buds are 30% smaller. Samsung believes version two will be more comfortable and fit in the ear better. Need the Buds+ for a run but battery is dead? Rapid charge 1.5 minutes for over two hours of use. Overall battery life improved two-fold.
More details after we test the devices further. For volume expectations, see here.
Counterpoint will be attending Samsung Galaxy Unpacked event on February 11
Our analysts, Jeff Fieldhack and Hanish Bhatia will be attending Samsung Galaxy Unpacked 2020. You can schedule a meeting with them to discuss the latest trends in the technology, media and telecommunications sector and understand how our leading research and services can help your business.
Click here (or send us an email at contact@counterpointresearch.com) to schedule a meeting with them.
Powerful cameras, competitive pricing key selling points Three models likely for the initial lineup LTE variant possible for less-developed markets
New Delhi, Mumbai, Hong Kong, Seoul, San Diego, London, Buenos Aires – Feb 6th, 2020
The next-generation Samsung Galaxy S20 series smartphone will be unveiled at the company’s Unpacked event which takes place on February 11. We expect 2020 shipments to exceed 40m units, driven by the rumored camera and hardware spec improvements, default 5G, and competitive retail pricing. Shipment numbers will also reflect an expected 2020 smartphone market recovery, resulting in another year of growth for a Samsung flagship release.
Much of the Galaxy S20 focus has been on the cameras, with the base model rumored to have 12MP main, 10MP front-facing, 64MP telephoto with 3x optical zoom, and 12MP ultrawide angle camera; with the S20 Plus having an additional ToF camera. The top-end Galaxy S20 Ultra is likely to come with a 108MP main, 40MP front-facing, 48MP telephoto with 10x optical zoom paired with a possible 100x digital zoom, providing for powerful hybrid functionality.
The Ultra model is also expected to come with a market-leading 16GB of RAM, positioning it as the industry standard for 5G. Sujeong Lim, research analyst at Counterpoint Research, states: “High-definition live video, high-end cloud gaming, and XR are important use cases in the early 5G era, and Samsung’s 16GB of high RAM capacity is considered as a preparation to provide a good user experience for these 5G applications.”
The S20 base model’s expected price tag of US$850 comes in at US$50 less than the S10 equivalent at launch, and should ease some resistance potential buyers will feel from premium prices. This, coupled with more 5G network rollouts “will have a positive effect on pulling up sales volume as 5G commercialization expands in the US, Europe, and other regions”, according Sujeong Lim. The S20 line could also come with LTE variants, allowing even lower pricing in regions where 5G has yet to make significant commercial inroads.
One risk to Counterpoint Research’s forecasts comes from the coronavirus situation. Although Samsung closed its Huizhou handset production line in 2H19, mitigating some of its production risk, retail sales could be hit as public events and marketing activities are scaled down due to virus fears. This is especially true in China where, so far, many cities have effectively shut down in efforts to contain the virus.
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Much of the Galaxy S20 focus has been on the cameras, with the base model rumored to have 12MP main, 10MP front-facing, 64MP telephoto with 3x optical zoom, and 12MP ultrawide angle camera; with the S20 Plus having an additional ToF camera. The top-end Galaxy S20 Ultra is likely to come with a 108MP main, 40MP front-facing, 48MP telephoto with 10x optical zoom paired with a possible 100x digital zoom, providing for powerful hybrid functionality.
