Samsung Changing Focus to Software & Services from Hardware

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With software and services increasingly becoming more lucrative, more and more companies traditionally involved in the hardware side of things have been spending time, money and energy trying to figure out how exactly to make that transition from being a hardware manufacturer to becoming a provider of software services. While Apple has already jumped onto the bandwagon with its payments gateway, Apple Pay, and its music streaming service, Apple Music, it is now the turn of South Korean tech giant, Samsung, to officially declare that the future lies in software and services. According to the president of mobile communications at Samsung, Mr. DJ Koh, "Coding is the key to the future". Mr. Koh made his observation at the company's annual developer conference that was held last week in San Francisco, California.

While Samsung's hardware business is doing pretty well for itself, the company is now apparently looking for ways to get into the software and services game, seeing as most of the opportunities over the next decade are expected to come from the segment. While Samsung's smartphone sales were impressive in the first quarter, the company says that it expects sales to remain largely flat in the coming months. With Samsung's consumer electronics business also stagnant for the most part, it isn't hard to see why the company is looking at other avenues to fuel growth, especially given the fact that a leading tech company like Intel just recently cancelled its upcoming Atom chips meant for smartphones and tablets, after having reportedly lost $7.3 billion over the past couple of years largely because of its failure to gain a slice of the smartphone processor pie.

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Meanwhile, Samsung will probably look at Tizen, the open source Linux-based platform, to deliver the same sort of results for it that Android has been able to do for Google over the past few years. Samsung already uses Tizen instead of Android Wear in its Gear range of smartwatches, and has even launched a couple of entry-level smartphones with the software, although, those devices have failed to find much traction among consumers. The OS is also at the forefront of Samsung's automotive endeavor, which shows just how much the company is hoping its Tizen gamble pays off. If it does, it will allow the company to integrate hardware, software and services into a single ecosystem much like Apple, thereby allowing it to grab a greater share of the overall revenues.