13.03.14-Galaxy_S4

What goes up, must come down? Samsung Loses $12 Billion in Market Value After Slowing Galaxy S4 Sales

June 7, 2013 - Written By Lucian Armasu

Samsung has benefitted from a lot of market momentum and mindshare ever since the Galaxy S3 has started being leaked on the web. That helped Samsung’s S3 sales a lot. When the tech reviewers gave it top score, when they preferred it over anything else, and when the community decided that the S3 was the “phone to get”, combined with Samsung’s advertising, it was a very smooth sailing for the Galaxy S3 in the market.

But things are not quite the same this year. Not only were most reviewers disappointed that the Galaxy S4 was a Galaxy S3 look-alike, but they also had a better alternative to look to this time around – the HTC One. I think the community was a lot more split up between the two in the beginning, but eventually they came to accept the HTC One as the better phone.

Not everyone thought that of course, as there are still more sales of the Galaxy S4 than the sales of HTC One, but the community usually sets the trend, and then the mass market follows. That’s why it’s so very important that OEM’s make phones that please the core Android community, and why they are starting to make Google Edition phones now, too. Advertising starts being worth a lot less when most tech sites think there are better alternatives, and when a lot of “tech influencers” have told their friends, or to others online, that they should get a different phone instead.

So for all Samsung’s advertising money, the Galaxy S4 is not infallible, although it should still experience quite some success in the market, but probably not as much as Samsung and Samsung’s stockholders were expecting.

People who have bought the Galaxy S4, or previous Samsung devices, and are very happy with them, will probably not like to hear this – but I believe this is a good thing not just for the Android market as a whole, but also for them as Samsung customers.

We were already getting all sorts of articles about how Samsung is taking over Android, and that it could endanger the Android community and the Android market. HTC, Sony and Motorola are still doing much worse than them. But if Samsung falls from its ranking even slightly, and loses some mindshare, this gives an opportunity for HTC, Sony, and Motorola to rise up this year, and prove their worth with their new smartphones, without everyone thinking “the Android phone to get is a Galaxy one”.

This will end up being great for consumers, if these companies get more successful, because if each of them can sustain their own Android smartphone business, we’ll see a lot more innovation in the Android market. Even better for Samsung customers, if they see the S4 strategy didn’t work (to use plastic, and make it look almost identical to the S3, adding too many unneeded features or Google apps clones), they’ll try even harder to make a much better device next year, as the Galaxy S5.

So how can this not be a good thing for everyone in the long term? We don’t need a monopoly in the Android market. We need every one of the top companies to compete on equal footing, and for Google to maintain control of the Android ecosystem. I think this is what we all want in the end.

Via Reuters