While Samsung Electronics and Apple have released the best-selling smartphones, latecomers such as Google and Huawei are also raising new product prices. The price hike of smartphones is expected to accelerate.

According to the industry on November 14, after the smartphone price hikes of leading companies, they are affecting the clients. Samsung and Apple released their flagship smartphone Galaxy Note 8 and iPhone X (TEN) as the most expensive outlets ever. Samsung`s Galaxy Note 8 went up to KRW 1 million with a total of KRW 1,094,500. The former Galaxy Note 7 was KRW 988,800 and Galaxy Note series exceeded KRW 1 million after Galaxy Note 3 in 2013 is the second. Apple`s iPhone, released this month, costs USD 999, up 35 percent from the previous USD 649. The price of the domestic carrier of the Apple iPhone X is set at between 1.36 million and KRW 1.55 million. It is the highest price of the smartphone of the past as the standard of the carrier.

Consumers` psychological cap has risen due to the high prices of Samsung and Apple. Galaxy Note 8 has already sold 820,000 pre-sales volumes at the highest price ever. The iPhone Ⅹ, which is not yet launched in Korea, will also enjoy a positive response from overseas.

Second-hand smartphone operators are also joining the ranks of high-end smartphones. Google released Pixel 2XL (128GB) for $ 950. Up more than 21 percent from $ 748 on the same-spec pixel (128GB). Currently, the official price of the Galaxy Note 8 is US $ 950 (unlocked). Huawei has set a price of 799 euros (10,600 won) for a 10-inch premium smartphone mate, which features a chip for artificial intelligence (AI). The price is 12% higher than the mate 9, which was 699 euros.

The flagship smartphone price hike is due to the difficulty of top-line growth in the smartphone industry.

The smartphone market has matured and the shipment growth is slowing. The industry expects the industrial growth rate to be 2-3% by 2020. Emerging markets such as India and Southeast Asia have growth potential, but mid- to low-end smartphone markets are being formed. Chinese smartphone makers are threatening Apple and Samsung by increasing their low-cost shipments. More recently, mid / low-end smartphones are also improving performance with octa core chipsets and more than 3GB of RAM.

In the end, it means that it is difficult to increase margins by increasing shipments and promoting sales. The smartphone replacement cycle is changing into a structure that generates profits by raising prices in line with demand. As such, the price hikes for flagship smartphones are expected to continue for the time being. "The leading players, Apple and Samsung Electronics, showed an aggressive pricing policy, so there was room for a surge in the pricing policy of second-tier companies," said Koo Hai-young, a researcher at Hai Investment & Securities.


By Kim Ji Young kjy@


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