Samsung, Huawei getting close to iPhone, spending on camera hardware to get there
Android smartphones focusing on improved displays and cameras haven't beaten the iPhone but are narrowing the gap, suggests analysts from Cowen, with main rivals Huawei and Samsung said to be considerably outspending Apple on the rear camera assembly in each of their flagship mobile devices.
Samsung Galaxy S10+ (left) and the iPhone XS Max
A preliminary analysis of the bill of materials (BOM) for the Samsung Galaxy S10+ and the Huawei P30 Pro reveals the two companies are getting quite close to Apple in terms of their margins, a Cowen investor note obtained by AppleInsider advises. While the iPhone has been estimated to cost low to mid-60 percent margins for the last couple of generations, the Galaxy S10+ is thought to have margins of 57 percent to 60 percent, while the P30 Pro is estimated to be between 63 percent and 65 percent.
"We estimate that Apple and its peers have been able to maintain or expand hardware margins in recent years even with escalating BOM costs in certain subsystems," according to Cowen.
The biggest and most obvious escalation in spending is on the cameras, with the S10+ having two front and three rear cameras, the P30 Pro having one at the front and four at the back, and the iPhone XS and XS Max using TrueDepth at the front and two at the rear.
Samsung's cameras are estimated to cost $44 per device, while the higher resolution and Time-of-Flight camera used in the P30 Pro pushes the cost up to $56, whereas the iPhone is thought to have a camera system that costs $34.50 per device, representing 8 percent of the BOM. Just on rear cameras alone, Samsung and Huawei are forecast to have respectively spent 1.4 times and 1.9 times as much as Apple.
The price difference may simply be down to the use of more cameras on the Samsung and Huawei devices. Apple is rumored to be adding a square camera bump and a triple-lens configuration on its 2019 iPhones, which could provide a third zoom option alongside the established wide-angle and telephoto cameras, or even to enable depth mapping.
Though iPhone remains competitive in camera quality, "Apple's greater integration of software to complement the hardware sensors is an element that cannot be fully captured in a BOM analysis," admits Cowen. "We also note that Google's Pixel smartphone family which has highly regarded image capture abilities still makes do with a single rear main camera with software helping it maintain an edge in image quality."
In comparing the displays, and assuming Samsung is the supplier for all models, the iPhone's screen is estimated to cost $120, while the higher pixel density Galaxy S10+ is worth $125, and the lower resolution and color gamut P30 Pro is $110. Representing between 20 and 25 percent of the BOM, Cowen concludes the screens of all three "are all of leading edge quality with subtle differences noticeable in a side-by-side comparison."
Though less of a competitive area, the processing capabilities of each are also thought to be worth monitoring, with the A12 Bionic using a hexa-core design while the Samsung and Huawei versions are octa-core based and have integrated LTE modems. "We believe the addition and innovation of AI accelerator cores or 'neural engines' as part of the GPU core design is of a greater focus," the note reads.
Cowen warns that the 4G design expertise of Huawei "and even Samsung" have garnered over the last few years could help the two companies put Apple at a near-term disadvantage for 2019 with the introduction of 5G cellular services. Apple is not anticipated to bring out a 5G-capable iPhone in 2019, which may give its rivals a significant advantage in terms of connectivity.
It is unclear if Apple will maintain its overall lead long term, as Cowen suggests "With peers focusing on superior display and camera quality, we believe it is too early to tell if catering to social media power users will lead to further iPhone sales declines."
While Cowen's BOM breakdown shows that there is comparative levels of cost between the three models, it is worth remembering that both the Samsung Galaxy S10+ and the Huawei P30 Pro are relatively new devices, whereas the iPhone XS was launched in September last year. Both Samsung and Huawei had the opportunity to learn what they needed to change in their flagship models to keep them competitive with the latest iPhones before launching them.
Samsung Galaxy S10+ (left) and the iPhone XS Max
A preliminary analysis of the bill of materials (BOM) for the Samsung Galaxy S10+ and the Huawei P30 Pro reveals the two companies are getting quite close to Apple in terms of their margins, a Cowen investor note obtained by AppleInsider advises. While the iPhone has been estimated to cost low to mid-60 percent margins for the last couple of generations, the Galaxy S10+ is thought to have margins of 57 percent to 60 percent, while the P30 Pro is estimated to be between 63 percent and 65 percent.
"We estimate that Apple and its peers have been able to maintain or expand hardware margins in recent years even with escalating BOM costs in certain subsystems," according to Cowen.
The biggest and most obvious escalation in spending is on the cameras, with the S10+ having two front and three rear cameras, the P30 Pro having one at the front and four at the back, and the iPhone XS and XS Max using TrueDepth at the front and two at the rear.
Samsung's cameras are estimated to cost $44 per device, while the higher resolution and Time-of-Flight camera used in the P30 Pro pushes the cost up to $56, whereas the iPhone is thought to have a camera system that costs $34.50 per device, representing 8 percent of the BOM. Just on rear cameras alone, Samsung and Huawei are forecast to have respectively spent 1.4 times and 1.9 times as much as Apple.
The price difference may simply be down to the use of more cameras on the Samsung and Huawei devices. Apple is rumored to be adding a square camera bump and a triple-lens configuration on its 2019 iPhones, which could provide a third zoom option alongside the established wide-angle and telephoto cameras, or even to enable depth mapping.
Though iPhone remains competitive in camera quality, "Apple's greater integration of software to complement the hardware sensors is an element that cannot be fully captured in a BOM analysis," admits Cowen. "We also note that Google's Pixel smartphone family which has highly regarded image capture abilities still makes do with a single rear main camera with software helping it maintain an edge in image quality."
In comparing the displays, and assuming Samsung is the supplier for all models, the iPhone's screen is estimated to cost $120, while the higher pixel density Galaxy S10+ is worth $125, and the lower resolution and color gamut P30 Pro is $110. Representing between 20 and 25 percent of the BOM, Cowen concludes the screens of all three "are all of leading edge quality with subtle differences noticeable in a side-by-side comparison."
Though less of a competitive area, the processing capabilities of each are also thought to be worth monitoring, with the A12 Bionic using a hexa-core design while the Samsung and Huawei versions are octa-core based and have integrated LTE modems. "We believe the addition and innovation of AI accelerator cores or 'neural engines' as part of the GPU core design is of a greater focus," the note reads.
Cowen warns that the 4G design expertise of Huawei "and even Samsung" have garnered over the last few years could help the two companies put Apple at a near-term disadvantage for 2019 with the introduction of 5G cellular services. Apple is not anticipated to bring out a 5G-capable iPhone in 2019, which may give its rivals a significant advantage in terms of connectivity.
It is unclear if Apple will maintain its overall lead long term, as Cowen suggests "With peers focusing on superior display and camera quality, we believe it is too early to tell if catering to social media power users will lead to further iPhone sales declines."
While Cowen's BOM breakdown shows that there is comparative levels of cost between the three models, it is worth remembering that both the Samsung Galaxy S10+ and the Huawei P30 Pro are relatively new devices, whereas the iPhone XS was launched in September last year. Both Samsung and Huawei had the opportunity to learn what they needed to change in their flagship models to keep them competitive with the latest iPhones before launching them.
Comments
The P30 Pro scores 112, the iPhone Xs Max 105 and the Xr 101 at DxOMark.https://www.dxomark.com/category/smartphone-reviews
Ill stick with my 7+ until Apple has some good features that are worth shelling out 1250$
And that doesn't even touch on Samsung and Huawei not being in contention for other reasons.
It is also worth remembering that Apple has been losing ground to Huawei since 2017 and not just on the latest flagships.
Huawei has pulled ahead in major areas:
Shell design
Battery tech
Modem tech
Camera tech
OS is a question of preference and EMUI is apparently a 'like it or loathe it' case but I much prefer it to iOS.
Huawei even did more with 3D depth sensing.
The Mate 10 brought us an - on SoC - gigabit modem. The P20 Pro brought the tri-camera and Night Mode. The Mate 20 Pro brought Live 3D with each refresh taking the previous models' highlights and improving on them.
All of that was already ahead of Apple. These new flagships have simply pushed them one step ahead again.
This means that if Apple releases a tri-camera this year end (2019 refresh), it will literally be a year and a half behind Huawei on that major characteristic.
As for image quality, most phones take more than good enough photos and have done for years. Now, quality alone is not enough. Now it is quality AND versatility. How can we even compare a Huawei phone camera - from a year ago - to the latest iPhone if the iPhone can't even take the same photo?
That versatility is where Apple is getting knocked out of the park when pitted against the P30 Pro for example and the P30 Pro will see a raft of updates to tweak its photo prowess.
Reviewers are even using the 50x zoom on the P30 Pro - as binoculars!
Having better video options is of little condolence when Apple's refreshed lineup will go up against both the new Note and Mate series on release. And Huawei has already demoed its its 'dual video' feature which could find niche uses.
Then, you have the little details like dual frequency GPS, AIIS, AI used for battery management, noise cancellation, call enhancement, nano card storage, true dual SIM etc. Many Huawei phones even have an IR blaster!
And then the 'boring' stuff like the ability to hold a signal in difficult scenarios or at high speed. The 2017 demo showed how, the then brand new, iPhone X lost its GPS tracking while passing through a tunnel under a river while the Huawei remained locked on. How the Huawei could handle tower handovers with ease on high speed trains. How the iPhone X stopped working at low temperatures (Alaska field trip) while the Huawei came back with the photos.
Apple has to deliver a major update this year and definitely review the 'S' cycle strategy. On top of that it will have to take a long hard look at pricing.
The competition is more than fierce right now.
I can guarantee that the biggest cheer at the 2019 iPhone refresh will be when they reveal it won't have a 5W charger in the box.
Both companies can’t be compared to apple , design and fluidity wise. And iOS is miles ahead of the unstable android
Everybody uses off the shelf components (Apple too) but Huawei is one of the world's most vertically integrated companies too.
To take a recent development. Rumours state Apple is moving up to 2,000 engineers to get working on a new modem. Currently it uses an off the shelf part.
Huawei has built its own for years and already has a 5G modem - shipping.
Apple uses off the shelf wi-fi. Huawei has developed its own. I believe it is currently the world's fastest wi-fi chipset on a mobile device.
I could go on.
Fashion counts (especially in China) even though phones end up in cases.
It doesn't make a lot of sense to some but one aspect of phones is design and your first contact with one is its design. Like food at a restaurant. It enters through your eyes first. The shell is important.
Last year Huawei took a gamble on gradient finishes and it paid off. The 'Twilight' gradient set a trend that many followed. We can say that 2018 was the year of the gradient in terms of phone shell finish.
However, Huawei has a long history of experimenting with phone finishes.
It releases so many phones a year (Huawei and Honor) that it is easy to test the waters with new ideas and see how they work.
They have been working on layering techniques, nano coatings, ribbing etc. for many years.
This year they have taken the P20 gradients and refined them. I have seen both the Amber Sunrise and Breathing Crystal finishes in person. They are both - stunning. Absolutely beautiful.
This doesn't mean Apple's are ugly. They suffer from being a little 'boring' with regards to what is on offer. The XR took a step in the right direction, though. There is no denying that, but your options of course are limited.