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IC Shortages Cause Shift in Priority to High End Smartphone
Samsung Electronics Co. said it has not yet decided whether to suspend production of its new budget phone, in response to a report that the company has halted output of the Galaxy S21 Fan Edition because of a chip shortage. The South Korea’s Electronic Times reported Sunday that the company had suspended production of the less expensive version of the Galaxy S21 due to a shortage of Qualcomm’s application processors, citing an unidentified person in the industry. The report has been deleted. The S21 FE was expected to be released later this year. The Galaxy S21 FE is the budget edition of the Galaxy S21 flagship smartphone released in January. The product is expected to be launched in September or October as Samsung apparently wants to focus on promoting foldable devices in the summer, according to the sources.
Smartphone shipments are expected to grow 12% in 2021 to 1.4 billion units worldwide, but a lack of components could hold back the industry and drive up prices for consumers. Smartphones are having a bumper year in 2021 after a slowdown in 2020 due to the pandemic, but analyst firm Canalys reckons bottlenecks in the supply of components will restrict growth in the coming year. The world is still facing chip supply constraints that have affected all industry sectors, from smartphones to vehicles: analyst firm Gartner estimates that the semiconductor shortage will last well into 2022. As key components, such as chipsets and memory, increase in price, smartphone vendors must decide whether to absorb that cost or pass it on to consumers. And as there are major constraints around LTE chipsets, this will cause challenges at the low end, where customers are particularly price sensitive.
Samsung Electronics Co. said it has not yet decided whether to suspend production of its new budget phone, in response to a report that the company has halted output of the Galaxy S21 Fan Edition because of a chip shortage. The South Korea’s Electronic Times reported Sunday that the company had suspended production of the less expensive version of the Galaxy S21 due to a shortage of Qualcomm’s application processors, citing an unidentified person in the industry. The report has been deleted. The S21 FE was expected to be released later this year. The Galaxy S21 FE is the budget edition of the Galaxy S21 flagship smartphone released in January. The product is expected to be launched in September or October as Samsung apparently wants to focus on promoting foldable devices in the summer, according to the sources.
Smartphone shipments are expected to grow 12% in 2021 to 1.4 billion units worldwide, but a lack of components could hold back the industry and drive up prices for consumers. Smartphones are having a bumper year in 2021 after a slowdown in 2020 due to the pandemic, but analyst firm Canalys reckons bottlenecks in the supply of components will restrict growth in the coming year. The world is still facing chip supply constraints that have affected all industry sectors, from smartphones to vehicles: analyst firm Gartner estimates that the semiconductor shortage will last well into 2022. As key components, such as chipsets and memory, increase in price, smartphone vendors must decide whether to absorb that cost or pass it on to consumers. And as there are major constraints around LTE chipsets, this will cause challenges at the low end, where customers are particularly price sensitive.
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