Samsung’s new devices acknowledge industry maturity

Samsung today announced its latest flagship smartphone, the Galaxy S5, along with a fitness-oriented wearable, the Galaxy Gear Fit, in addition to providing more details about its new Gear smart watch devices, which were announced over the weekend. The following comment may be attributed to Jan Dawson, Chief Analyst, Jackdaw Research:

“Samsung’s announcement was much lower-key than its recent events, which seems to be an acknowledgment that too much of the attention has been focused on the spectacle rather than the content at previous launches. But it also seems to have toned down its attempts at bombarding potential customers with massive numbers of new features, choosing instead to focus on just a few key features for each device. At the same time, Samsung made a big deal about meeting users’ needs rather than necessarily inventing anything itself. Samsung now appears to be focused on innovation by focus group, talking about new features as meeting the top three user demands in a particular area, for example. This is a recognition of the increasing maturity of the smartphone industry in particular, where we no longer see big leaps forward in core features, but instead are seeing the same features already present in other devices showing up on each new flagship from the major vendors. But it’s also disappointing to see Samsung so humbled by the relatively poor performance of the Galaxy S4 that it appears to have given up on inventing its own new ideas.

The fitness devices fix some of the problems that plagued the first Galaxy Gear, but without pricing it’s hard to know how compelling they will be. With the exception of the Pebble, most successful wearables today are in the fitness category, so it makes sense for Samsung to enter that market with the Gear Fit. The Gear Fit looks reasonably compelling, though the screen orientation is a bit odd, as the wearer will have to bend their arm in an unnatural way to get a clear look at it. The curved screen is the latest in a long line of display innovations from Samsung, but it’s not clear anyone is buying wearables for the screen. A simpler screen with better battery life might well have been a better investment from a user point of view. The new Gear watches also look like solid improvements, but they reinforce Samsung’s core strategy. Just as Apple won’t release iTunes for anything but iPhones, it appears Samsung won’t make its wearables compatible with anything but Galaxy devices. That makes sense from a strategic perspective, but limits the addressable market, though it’s now a large base at 200 million.

Samsung needs to prove that it can get back to the sort of growth it experienced in the smartphone space in 2011 and 2012, which means giving people compelling reasons to upgrade but also increasingly to switch from other vendors and platforms. The Galaxy S5 is a nice upgrade for someone with a two-year-old Galaxy S3, but there’s not much here to suggest it’s going to win many converts from other vendors or first-time smartphone users, especially as this is likely to be a premium device. The emphasis on wearables may be an acknowledgment of that fact: that growth will have to come from elsewhere in the future and not just from smartphones.”


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