Samsung, LG to release more phones this year to compete with Huawei/Xiaomi
A new report by Digitimes states that Samsung and LG have apparently adopted a policy to “launch [as many smartphones] as possible […] in 2018.” This is a contrast to their previous focus, which was mainly on high-end smartphone models. The change in policy is to compete with other brands in nearly all segments globally in order to increase their shrinking smartphone revenue.
The report states that Samsung and LG have already launched nine and eight new smartphones respectively so far in the first half of 2018. In 2016 and 2017, the two companies had released 11 models. Also, Samsung and LG have launched a number of models in some designated overseas markets this year.
This new policy comes at a time when the global smartphone market is reportedly heading downward in terms of unit shipments, with total global unit shipments decreasing by 3 percent year-over-year in Q1 2018, according to market research firms.
According to Strategy Analytics, Samsung’s global share has decreased to 22.6 percent in Q1 2018, down from 22.7 percent a year ago. LG’s market share has also decreased to 3.3 percent, while Apple’s share increased to 15.1 percent from 14.4 percent. Huawei and Xiaomi also gained market share, with Huawei gaining 2 percent to 11.4 percent and Xiaomi doubling to 8.2 percent.
Digitimes states that Huawei, Xiaomi and other Chinese smartphone device makers have been able to leverage their models with high price/performance ratios to undermine sales of other brands in all segments, particularly in Asia and Europe. For example, Huawei has reportedly shipped over six million units of the Huawei P20 and the Huawei P20 Pro since launch—an increase of 81 percent as compared to the Huawei P10.
The sales performance of the Xiaomi Mi 8 is also said to be impressive, with shipments reaching over one million units in the first 18 days of sales. The Mi 8’s list of specifications includes the Qualcomm Snapdragon 845 system-on-chip, 6.21-inch Full HD+ notched display, dual 12MP + 12MP (telephoto) rear cameras. Digitimes notes that its specifications are comparable to phones costing hundreds of dollars more.
Huawei, meanwhile, is said to be doing well in the Japanese market. The company is also looking to reportedly penetrate the Korea market.
In our view, it’s clear that in terms of value for money, companies like Xiaomi and OnePlus are providing a lot more than Samsung and LG. This is being reflected in the shrinking sales of companies which currently do not provide affordable flagships. Xiaomi has found success in China and India, while Huawei is the closest competitor to Samsung in some markets. It’s clear that competition is increasing in the Android smartphone market, and that is mostly a good thing.