They focus on best-in-class industrial design, volume manufacturing and worldwide distribution. They are also very successful in enterprise mobility. However, it's more challenging for them to win big in tablets.
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Samsung has grown from a member of a group of manufacturers of Android-based smartphones to become the worldwide leader in just a few short years. Lots of stories talk about the results. I thought it would be good to take a peek inside and analyze what happened that resulted in Samsung's global success in smartphones.
Overall, it's clear that Samsung is running all cylinders right now in the smartphone market. They got there, however, with a lot of focus on excellent industrial design and world class manufacturing. I can remember reviewing early Galaxy S series smartphones against Android competitors including HTC, LG, Motorola and Google. This was before their dominance, but I remember clearly feeling that Samsung had simply made a better device. It was smooth finish, very fine edges and connections. In some ways, you'd think, "How can there be that much difference between a number of Android smartphones?" But, Samsung had a brighter display, better placement of buttons and a better responsiveness. Their packaging was also nicer. And, in the beginning of the Android smartphone market, the software was pretty much the same. But, Samsung has worked hard to create advanced features in both hardware and software. Thus, they started with a better overall device and have kept up the pressure to build a better Android smartphone by improving both hardware and software. Here are a few things that they have done over the past few years:
Hardware
- Motion detection like shaking to do a number of apps like update.
- Vibrate the screen when selecting text to give tactile feedback
- Auto listening for special phrases to launch apps
- Dual Camera' function that allows simultaneous use of both front and rear cameras.
- Samsung S Beam™ that lets you share files, videos, and photos with other Galaxy devices. This is basically the use of Near Field Communications (NFC) to share information between two Samsung Galaxy S devices.
- Easy Mode and Samsung S Voice™ for a simplified user experience
Software
- 'Story Album' function automatically gathers and sorts out according to your timeline, geo-tagging information, or a specific event to create a photo album
- 'Group Play' enables users to play music, photos, documents and games with those around them without even requiring a Wi-Fi Access Point or cellular signal.
- 'Share Music' allows users to have the same song playing on multiple phones in sync to create the best party atmosphere.
- 'S Translator' provides instant translation, using text or voice translation on applications including email, text message and ChatON.
- 'Smart Pause' enables you to control the screen by where you look.
- 'Smart Scroll' allows you to scroll the browser or emails up and down without touching the screen. It recognizes your face looking at the screen and movement of your wrist and then scroll the pages up or down accordingly.
- 'Air View' allows users to hover with their fingers to preview the content of an email, S Planner, image gallery or video without having to open it. You can even see a magnified view on the internet browser or a phone number saved in the speed dial on the keypad.
- 'Air Gesture' changes the music track, scroll up and down a web page, or accept a call with a wave of your hand.
- 'S Voice Drive' activates commands via voice control for optimization when driving. Once connected with a car Bluetooth, the phone automatically turns into driving mode converting text to speech so you can easily and safely check messages with no need to look at the screen.
- 'Optical Reader' makes life yet more effortless, by automatically recognizing text, a business card or QR code information, and providing useful functions such as translation, call, text message and search.
- 'WatchON' transforms the phone into an IR remote to control your home entertainment system including TV, set-top box and DVD player.
- 'S Health' software provides a combination of sensors built within the device systematically and automatically monitors your health, surroundings and so much more to help improve your quality of life.
- 'Adapt Display' provides an optimal viewing experience, customized for each type of application.
- 'Adapt Sound' offers an optimal level and type of sound, personalized for each user, to make the most out of life.
Services
And, Samsung has been able to manufacture Galaxy S and Note series in a number of different screen sizes giving users a choice of smaller 4.3" in the S mini through the traditional 4.7" S series and larger units like the Note 3 with a 5.3" display and the Mega with an even larger 6.3" display.
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Samsung has also developed the best-selling smartphone for the enterprise. They have focused on features and services that make the Galaxy S and Note series serve enterprise requirements. They started with their Samsung for Enterprise (SAFE) program that provides four main features:
- Advanced Microsoft® Exchange ActiveSync™ features
- On-device AES 256-bit encryption
- VPN connectivity
- Leading, multivendor Mobile Device Management support
On the hardware front, Samsung has built a business rugged model called the Galaxy S 4 Active that give field workers with the same quality as the S series but built for outdoor situations for vertical markets such as public safety, first responders, fire and forestry. Samsung Galaxy S 4 Active features a heavier and thicker case than the regular Galaxy S to keep out dust. The device can also be submerged in three feet of water for up to a half-hour.
Their latest advancement in hardware and software for the enterprise is the announcement of KNOX that provides the following services:
- Separate personal apps and data
- Password-protected Samsung KNOX container for work
- Virtual Private Network (VPN) support
- On-Device Encryption (ODE)
- Smart Card authentication
- Device theft recovery
Samsung has been approved for use by the Department of Defense. KNOX resulted from doing interviews of enterprises and government institutions to determine requirements. From there, they were able to quickly build KNOX to be offered in mainstream S series smartphone devices.
Most recently, Samsung has launched Samsung Solutions Exchange to provide holistic solutions for enterprise customers. The program includes partnerships with third party software developers and software system providers. It supports developers in bringing business software solutions to market and helps get their story out to enterprise customers. In essence, this is like a qualified directory of applications and software systems that have been certified to work well with Samsung mobile devices.
Samsung has done a particularly good job in securing top personnel, especially in the enterprise arena. Tim Wagner, Vice President and General Manager of Enterprise Sales, held a similar position at BlackBerry. He is joined by Dave Lowe on the enterprise sales side and Chris Horner on the enterprise marketing side who all provided input to this story.
Another area in which Samsung has excelled is in partnerships. They have forged strong relationships with major mobile device management and software providers such as AirWatch, Good Technology, MobileIron and SAP. They make sure that their new Galaxy smartphones will work with their partners by giving them advanced pre-launch access to new models and providing tech support.
Samsung is also working with a number of major enterprises - helping them get the resources they need, test them and then roll them out which results in large deployments. A good example is American Airlines which is outfitting all flight attendants with Galaxy smartphones outfitted with credit card readers and access to both food/drink items to sell and also AAdvantage member information to provide better and more personalized services.
Another example is working with Boston Scientific to deploy Galaxy S series smartphones to meet their requirements for medical device sales. Samsung has been able to consider hardware customizations in cases that are appropriate for both parties.
Samsung's marketing efforts are also coming to be working well. Certainly, their Super Bowl ad showing Seth Rogen and Paul Rudd assuming they were the new star personalities for Samsung only to be upstaged at that last second by Lebron James. That ad was as good as any technology ad in recent years - memorable like Apple's 1984 ad introducing the Mac.
I would be remiss if I didn't mention something comparing Samsung to Apple. Both are achieving tremendous success in the smartphone market with Apple's iPhone vs. Samsung's Galaxy. Apple has done a fine job of building excellent smartphone devices but Samsung has a broader product portfolio and what seems to be more advanced hardware not found in the iPhone (although Apple just introduced Touch ID to the iPhone 5s that senses the user's fingerprint to provide easy access). If user's want a display larger than 4", then they will select Samsung's Galaxy series. And, Apple has done a better job of integrating software into their platform, but Samsung has announced more software solutions. Both Samsung and Apple are doing and will continue to do well.
And, in the enterprise, Samsung has benefited from the BlackBerry's missteps primarily over the multi-year delay in getting their new BB 10 OS and devices into the market.
At this point in the evolution of the smartphone, it could be argued that it's important for the manufacture to control the entire environment - from the hardware to the operating system to the software and services that ride on top of the OS. Samsung, today, is reliant on Google for the operating system. But, Samsung has recently joined with Intel and a number of other firms to develop Tizen, a Linux based open source operating system that should come into trials in 2014. It incorporates Samsung's prior Bada OS effort. If successful, Tizen could provide Samsung with its own operating system allowing them to control the full stack of hardware and software in future Galaxy smartphones and tablets.
Samsung has not - as yet - been able to overtake Apple in the sale of tablets. The Apple iPad Air and mini line are still commanding 52.8% market share of tablets (with Samsung leading the Android market with 12.4% overall share) based on Compass Intelligence market analysis for 2013. Our just-completed forecast shows that Android-based tablets will become the overall leading platform during the next five years. Samsung is making inroads, but with their S Pen technology and other enhancements such as KNOX we'll likely see them close the gap with Apple in tablets in the coming years.
You really have to commend Samsung for the way they have put their ecosystem together for mobile devices, particularly in the smartphone arena. This market isn't nearly fully mature: smartphones are only approximately 50% of the total number of worldwide cell phones produced each year. We expect to see smartphones grow to 80% or more of the total cell phone market over the next five years. Samsung (as well as Apple) have a huge upside in market opportunity of over a billion additional, new smartphones a year.
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J. Gerry Purdy, Ph.D.
Chief Mobility Strategist
Compass Intelligence
gerry.purdy@compassintelligence.com
404-855-9494