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Samsung’s Current Situation And What Comes Next

August 2, 2014 - Written By Kristijan Lucic

Samsung is one of the biggest smartphone manufacturers in the world. They also sell all kinds of other products such as TV-a, monitors and so on. Our focus is of course on their Android smartphone/tablet/wearables business. Samsung grew at an incredible rate over the years in order to become what it is now, ever since they’ve launched their first Android Galaxy device, Samsung i7500 Galaxy back in 2009. They outsell even Apple when it comes to smartphone/tablet sales. It is well known though that unlike Apple, Samsung is making tons of devices per year. They’re known for making all kinds of crazy devices and push them out to the market to see if they will sell, if they do they’ll just roll with it. Just remember the first Galaxy Note, that device was huge and it gained popularity incredibly fast along with basically jump starting today’s trend of oversized phones which are called phablets. There were of course some less popular prototype phones (if I can call them that) out there, Galaxy Mega and Galaxy Round for example.

To cut the long story short, Samsung owns the market right now. Though there are some signs of concern for this South Korean giant. They’ve seen a significant decline in profit in Q2 this year despite all those billions that were invested in marketing. There are many reasons for this, but the main ones are Chinese startups that have started offering rather solid phones for lower prices than Samsung and other better known manufacturers which stepped up their game and started offering great devices in all three part of the market (low, mid and high-end). Take Motorola for example with their Moto E and Moto G offerings, I’ll emphasize Moto G in this case which is a great phone for that price, I’ll even argue you can’t get better for that amount of money. HTC has also stepped up their game significantly when it comes to low and mid-range offering with their Desire line. Others worth mentioning are Huwaei, ZTE, Oppo and Xiaomi. All of these firms sell tons of devices, primarily in Asia, with a huge emphasis on Xiaomi which has significant plant of coming to other markets and if that happens Samsung could really feel the heat.

Most of you know that Samsung just loves plastic materials such as polycarbonate when making its devices. They’ve been sticking to the same recipe for years, which might not be a bad thing. On the other hand they were somewhat afraid to take the risk when it comes to their flagship Galaxy S and Galaxy Note lines, at least in my opinion. Let me elaborate, I don’t necessarily mean they should have changed their build materials, but differentiate a bit. Galaxy S3, S4 and S5 look way too much alike, some would argue even the first two models. You could say the same for the Note line as well. This i only my opinion though, primarily because I remember Galaxy S3, S4 and S5 announcements rather vividly. I was seriously underwhelmed with all 3 of those devices and I’ve owned Galaxy S2 at the time. Another problem might lie in their software offering. There are people who love TouchWiz, but it is stale at this point, not to talk about bloat which comes with it.

Another threat to Samsung might lie in Google’s Android One program announced at this year’s Google I/O. Extremely cheap devices with basically vanilla Android and regular updates? Yeah, that sounds like something people would buy and be happy with, especially if Google does the marketing part well and it seems like they will. This could damage Samsung’s profits in emerging markets.

It seems like Samsung might take a step in a different direction rather soon considering vice-president of Samsung Mobile recently announced that they’ll bring in a device with “new materials” later this year. We immediately assumed he’s talking about a rumored Galaxy Alpha device which is expected to sport a 720p screen and have metallic materials included in the design.

It is worth mentioning that Samsung is also pushing strong when it comes to tablets and wearables. They’re constantly releasing wearable devices such as Galaxy Gear, Gear 2, Gear Fit and the one that is currently most interesting to us Gear Live. Galaxy Gear originally came with Android pre-installed, but an update to Tizen came to the watch recently. As for Gear 2 and Gear Fit, Tizen is the OS of choice there as well. Gear Live on the other hand sports Google’s new Android Wear OS.

To sum up, Samsung seems to be ready to push different materials to its smartphones, at least try to do so. Galaxy Alpha sounds like an experiment device considering its specifications and we guess Samsung wants to see how will the sales go before planning anything more serious. Also note that they’ve changed their lead designer a while back, so this might also have something to do with all this. As far as wearables are concerned they seem determined to push both Tizen (their OS) and Android Wear, which is just fine considering they can afford it.

We hope Samsung has learned its lesson and that it will alter its design (slightly) and change up its software, which is more important than hardware, at least if you ask for my opinion. What are your thoughts on all this? Which way do you think Samsung will go and will their profit keep on dropping or not?