Samsung Struggles Prompt Price Cuts

On Wednesday, Samsung announced their new 5G smartphones will be released near the end of August, with price tags for the new Galaxy S20 and Galaxy Note 20 starting at $1,000. That’s a $300 price decrease from their flagship smartphones from 2019, and follows the trend of declining high-end smartphone prices over the last few quarters. It may be needed for the South Korean company, which has seen smartphone shipments decline faster than the industry average over the last six quarters.

As of the second quarter of 2020, Samsung’s smartphone shipments are down nearly 30 percent from a year prior. That’s below the industry average of 26 percent, and far below competitors Huawei and Apple, the latter of which actually saw an increase in smartphone shipments during this last quarter.

COVID-19 restrictions have hit Samsung particularly hard. The company has been below the industry average for smartphone shipments for both quarters in 2020 and was already trending downward to end the fourth quarter of 2019. One factor that hasn’t helped Samsung’s flagship Galaxy smartphones is the slow implementation of 5G, which the company has made a staple of the Galaxy series of phones. By dropping the price of their 5G-enabled product line, Samsung is hoping telecommunication companies speed up implementation of 5G towers with more consumers in possession of capable hardware. Apple is scheduled to release their first 5G-enabled smartphone this fall, pressuring Samsung to grab an early market share before their competition.