Seeking Alternatives

The market is paying a lot of attention to a card that Samsung Electronics will pull to fill the vacuum left by Galaxy Note 7 and minimize a drop in the company’s market share.
The market is paying a lot of attention to a card that Samsung Electronics will pull to fill the vacuum left by Galaxy Note 7 and minimize a drop in the company’s market share.

 

The early cease of sales and production of the Samsung Galaxy Note 7 is expected to make many changes in shares of the world smartphone market where Samsung Electronics widened its gap with Apple to nearly 10%p. The market is paying a lot of attention to a card that Samsung Electronics will pull in order to fill the vacuum left by the ill-fated smartphone and minimize a drop in the company’s market share in the second half of this year. 

According to the smartphone industry on October 18, it is predicted the shutdown of the Galaxy Note 7 business will inevitably send down Samsung Electronics’ global market share in the second half of this year. According to market researcher Gartner, Samsung Electronics and Apple accounted for 22.3% and 12.9%, respectively, in the second quarter of this year.

The securities industry is forecasting that Samsung Electronics will ship about 66 million units of smartphones in the fourth quarter of this year. The volume is a drop of about 12% from 75.2 million in the third quarter of this year. Compared to the same period of last year when the volume hit 81.3 million, the volume is expected to shrink 18.8%.  Accordingly, the market is forecasting that Samsung Electronics’ annual shipments will slip below the 300 million unit level to 290 million units. Last year, the Korean smartphone giant shipped 320 million units in total.

Its rivals are expected to benefit from Samsung Electronics’ situation. Trend Force, a market research firm predicted that the discontinuation of the Galaxy Note 7 will push up smartphone shipments of Apple and Huawei 1.5% and 3.5%, respectively, this year.

Therefore, it has risen as a matter of great interest what product Samsung Electronics will use to fill the vacuum left by the demise of the Galaxy Note 7 in the second quarter of this year. Various scenarios come out. First of all, it is strongly predicted that Samsung Electronics will expand production of mid-priced models such as the Galaxy A and Galaxy J. It is also said that the company may launch new budget smartphones. Some experts predict that Samsung Electronics may put more advanced “Tizen phones” front and center in the market.

On top of that, a possibility is being raised that Samsung Electronics will launch an upgraded version of the Galaxy S7 series that will fight with the iPhone and V20 in the premium smartphone market for now. This means that Samsung Electronics will seek to change moods by changing storage capacity and colors as it will not be easy to make a big change in the Galaxy S7’s performances. Some consumers anticipate that Samsung Electronics will launch a temporary replacement phone which is in the middle between the Galaxy S7 and Galaxy S8.

Even though there is a forecast that Samsung Electronics may release earlier the Galaxy S8 scheduled to hit the shelves in the first half of next year, but experts say that the possibility is slim.  “Although there are many voices for the early launch of the Galaxy S8, it is not important to advance the launch of the product,” said Lee Seung-woo, a researcher at IBK Investment Securities. “Even if the Galaxy S8 is launched earlier, it is highly likely that consumers will have a lot of time to verify the product before deciding to make a purchase of it. 

Copyright © BusinessKorea. Prohibited from unauthorized reproduction and redistribution