I guess a foldable phone that unfolds to be that large kind of competes/kills the market for iPad, so this kind of user probably expects to store the device in a bag instead of pocket, and use bluetooth / smartwatch / siri to interact hands free instead of pulling the phone out all the time.
The iPad lineup has forked into two classes that seem to be drifting in the direction of “alternative laptop” or “portable television” respectively. A big folding phone would maybe eat into that second case somewhat, but I still view it as a distinct specialization. The difference would probably be clearer if they set up iPadOS to be viable as a shared multi-user/family device instead of assuming it must have a single owner.