Analyst predicts Samsung will quit phones by 2020

Commodus

Diamond Member
Oct 9, 2004
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Ben Bajarin (one of the few market analysts known for actually understanding tech) just made a pretty bold prediction: that Samsung will exit the phone business by 2020.

What do you think?

I think it's entirely possible that Bajarin will be wrong, and he may be the first to admit as much. However, he does have a point. Samsung, like all phone makers that don't depend largely on their own OS, is a slave to commoditization: it can't compete on much else besides price, since it's just another Android vendor in the end. Why keep making Android phones when there's less and less money in it, and you can make a larger profit by selling chips and displays instead?

It's been discussed before, but there really does seem to be a valid parallel between smartphones and what happened to the PC market, where the Windows PC market is slowly shrinking and most of the profit has consolidated within the hands of a few companies (particularly Apple). I can't help but imagine that Samsung knows this -- the GS6 wasn't a mistake so much as an attempt to see if a big Android OEM can escape the commoditization black hole that caught Windows vendors. Well, from early indications, it can't (even a $120 price cut hasn't saved the GS6). It may have to accept that the Galaxy S' glory days are over, and that has to cede the high end to Apple.
 

Artdeco

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I definitely see some parallels between the PC market and Android phones.
 

Midwayman

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They're still involved in other highly commoditized industries. They might shift their focus a bit, but why leave money on the table?
 

Artdeco

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They're still involved in other highly commoditized industries. They might shift their focus a bit, but why leave money on the table?

LOL, right, I recently made the choice between an LG or a Samsung refrigerator, got the LG, it's a flipping work of art, dutch doors, 2 drawers, massive in door storage, an ice maker entirely in one door...
 

vi edit

Elite Member
Super Moderator
Oct 28, 1999
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How bizarre would it be if we just ended up seeing Apple, Microsoft, and Google branded phones?

After all the ride we've been through it just goes back to the OS developers to oversee and sell the design.
 

Artdeco

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Mar 14, 2015
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How bizarre would it be if we just ended up seeing Apple, Microsoft, and Google branded phones?

After all the ride we've been through it just goes back to the OS developers to oversee and sell the design.

I think, instead, we'll see a lot of manufacturers who do moderate to large volume with low margins on Android devices, the players are already in place.
 

pete6032

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Dec 3, 2010
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Analyst seeking media attention makes bold prediction about tech company.
 

core2slow

Senior member
Mar 7, 2008
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Hate to say it, but give it another 1-2yrs and Huawei/Mediatek would forced them out of the chip game, too.
 

postmortemIA

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Samsung and few other android makers did better when "2 yrs contract and $199 now" was only thing available, other than shelling out full price for unlocked. That and GS3 and GS4 were "needed" because previous generation were slow and ugly. Today nothing recent is slow.
IMO their problem was always trying to compete on specs, but not overall premium appeal. Apple does other way around.
Apple does not suffer of "one and done" problem. TouchWiz and its apps made me to never buy any of their phone under any circumstance. Samsung apps are second rate, and they should focus on something else.
 

StrangerGuy

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May 9, 2004
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Does Samsung make much money off of Samsung pay?

LOL if you think Samsung Pay is even going to stand a chance against the Apple version.

Hate to say it, but give it another 1-2yrs and Huawei/Mediatek would forced them out of the chip game, too.

Not because of technical superiority, but rather economics. It doesn't matter if Samsung got a flagship phone with a custom SoC when everyone else has stock ARM A72 devices that are only slightly slower at half the price at more or less the same specs.
 

pete6032

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Dec 3, 2010
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LOL if you think Samsung Pay is even going to stand a chance against the Apple version.



Not because of technical superiority, but rather economics. It doesn't matter if Samsung got a flagship phone with a custom SoC when everyone else has stock ARM A72 devices that are only slightly slower at half the price at more or less the same specs.
LOL
 

dawheat

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Sep 14, 2000
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They're still involved in other highly commoditized industries. They might shift their focus a bit, but why leave money on the table?

Samsung has shown the ability over years to take money where it can and shift/adjust as needed. TVs are a prime example of how Samsung evolves to stay relevant in highly commoditized markets - it uses tech/scale through their conglomerate structure to differentiate and pivoted to design to keep a quarter of the market.

As long as they can stay ahead of the pack through displays/SOC/camera, they'll keep taking the couple billion in profit a quarter. You'd think y/o/y profits didn't just go back up for Samsung in smartphone - it's not Apple but it's still billions.

Then when the time comes that there's nothing left to differentiate, I'd expect them to pivot to price and take on the Chinese brands directly like they have in plenty of other markets. It'll be a tough sell for most markets to get a Huawei or Xiaomai if a comparable name brand Samsung phone is only $50 more.

Quite honestly - I think Android enthusiasts have to be a bit careful. If it becomes a race to the bottom with the Chinese brands leading the way, that leads to only crappy products down the line with no innovation. For better or for worse, a world where Samsung is out of the smartphone game means Sony, HTC, LG, etc have long quit.
 

dawheat

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Sep 14, 2000
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LOL if you think Samsung Pay is even going to stand a chance against the Apple version.

Umm Samsung Pay, Android Pay, and Apple Pay are identical you know, down to the exact services they use from the big credit card companies. There is 0 difference between them in security or user experience (mostly b/c they copied Apple). The only difference is Samsung Pay has MST.
 

core2slow

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Mar 7, 2008
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Quite honestly - I think Android enthusiasts have to be a bit careful. If it becomes a race to the bottom with the Chinese brands leading the way, that leads to only crappy products down the line with no innovation. For better or for worse, a world where Samsung is out of the smartphone game means Sony, HTC, LG, etc have long quit.
You're assumption that Chinese brands are crappy products. Other than possibly slow updates, what could possibly make them any worse than some of the big boys?

All aluminum
6in IPS 1080p screen
13mp/5mp cameras
Fingerprint scanner
4100mah battery
Slim bezel
Minimal UI skinning
FM radio
MicroSD slot
US LTE frequency
Lollipop 5.1 ready

This is an example of a phone that was released in 2014 for $450 unlocked. If Sony/htc/lg/Samsung bailed out, there's certainly no love lost on my end as there are other competent makers out there waiting to take their spot.
 

KentState

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Oct 19, 2001
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Much to do about nothing IMO. Say Samsung releases the Note 10 in 2020 and it happens to be the best Android phone on the market. That gives me until 2023 or so before I need to replace it. Who really can predict how we will be using phones in 8 years? If anything, the internet of everything will play a bigger factor in our lives.
 

StrangerGuy

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May 9, 2004
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You're assumption that Chinese brands are crappy products. Other than possibly slow updates, what could possibly make them any worse than some of the big boys?

This is an example of a phone that was released in 2014 for $450 unlocked. If Sony/htc/lg/Samsung bailed out, there's certainly no love lost on my end as there are other competent makers out there waiting to take their spot.

He is still living in pre-2013 Android fantasy lala-land where there is still a huge gap between the high end and low end when that can't be any more further than the truth today. He can nitpick against low end for all he wants but people will more than gladly save 75% over a Samsung flagship for little compromise in actual usability.
 

KentState

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Oct 19, 2001
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He is still living in pre-2013 Android fantasy lala-land where there is still a huge gap between the high end and low end when that can't be any more further than the truth today. He can nitpick against low end for all he wants but people will more than gladly save 75% over a Samsung flagship for little compromise in actual usability.

And that's why Apple/Samsung are trying to get people into perpetual leases. By 2020, will a phone that's twice as fast as the 2019 model be noticeable? Probably not. So unless something truly innovative occurs, people will hold onto phones like they do with PC/laptops.
 

dawheat

Diamond Member
Sep 14, 2000
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You're assumption that Chinese brands are crappy products. Other than possibly slow updates, what could possibly make them any worse than some of the big boys?

All aluminum
6in IPS 1080p screen
13mp/5mp cameras
Fingerprint scanner
4100mah battery
Slim bezel
Minimal UI skinning
FM radio
MicroSD slot
US LTE frequency
Lollipop 5.1 ready

This is an example of a phone that was released in 2014 for $450 unlocked. If Sony/htc/lg/Samsung bailed out, there's certainly no love lost on my end as there are other competent makers out there waiting to take their spot.

Sorry, not the point I was trying to make. The Chinese OEMs have shown a great ability to take good features from other phones and put them together in appealing packages. They have no history at actually innovating on their own.

It's going to be like Samsung trying to innovate but 100X worse - at least with them you get some positive things like the Note series, S-pen, curved displays, using MST, etc. With Chinese brands leading the way you'll have things like Huawei's attempt at 3D touch - they threw in the hardware b/c they heard Apple was going to have it, but had absolutely no idea how to put it to use.

Samsung, LG, and Sony have also caught up to Apple in overall camera quality - both in image quality, focus speed, all conditions usability. All the Chinese OEMs are a year behind at least even though they have decent hardware.

That's the Android world we're going to - where things are pretty good, but nothing is going to be great and only Apple is pushing the industry forward.
 
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dawheat

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Sep 14, 2000
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He is still living in pre-2013 Android fantasy lala-land where there is still a huge gap between the high end and low end when that can't be any more further than the truth today. He can nitpick against low end for all he wants but people will more than gladly save 75% over a Samsung flagship for little compromise in actual usability.

This is more snarky then it needs to be considering I have no idea who you are. Feel free to disagree with me - I like an open debate. No need to be snide.

Curious- what Chinese phone have you used in 2015 that for example has a camera anywhere near the iPhone in all-round use? Is this just talking point from reviews or do you actually have first hand experience?

I've used the S6/Note 5/G4 cameras and they are the only ones that can match the iPhone. Other Android cameras are stuck in 2014 - if you stand perfectly still and your subject isn't moving and it's not too dark, you can get great photos. Otherwise good luck.
 
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core2slow

Senior member
Mar 7, 2008
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Sorry, not the point I was trying to make. The Chinese OEMs have shown a great ability to take good features from other phones and put them together in appealing packages. They have no history at actually innovating on their own.

It's going to be like Samsung trying to innovate but 100X worse - at least with them you get some positive things like the Note series, S-pen, curved displays, using MST, etc. With Chinese brands leading the way you'll have things like Huawei's attempt at 3D touch - they threw in the hardware b/c they heard Apple was going to have it, but had absolutely no idea how to put it to use.

Samsung, LG, and Sony have also caught up to Apple in overall camera quality - both in image quality, focus speed, all conditions usability. All the Chinese OEMs are a year behind at least even though they have decent hardware.

That's the Android world we're going to - where things are pretty good, but nothing is going to be great and only Apple is pushing the industry forward.
I get your point that they don't innovate like the major mfgrs do, but how do you equate that to being "crappy products"? All it comes down to is personal preference; I couldn't care less about the s-pen when I had my note 2, I couldn't care less about fingerprint scanner on my 6plus, I couldn't care less about the ultra pixel dual camera on my M7, but omit them and I wouldn't consider such phone a "crappy product" because they lack innovation. I'm just confused as to how their products are crappy when the overall package (aesthetics, functions, usability, battery life, etc) of some Chinese phones would make other OEMs blush.

Sure, they're not as talented as the major players and don't have some of the best engineers, but they have not shown in their presentation that they're averse to customers needs and wants and have, at least in my eyes, packaged some of the best phones right now in the market that are far from being crappy products.
 

Red Storm

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Oct 2, 2005
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I don't understand why there's this assumption that Samsung is supposed to retain overwhelming market share among Android phones. In early Android days there weren't many companies competing. There are way more players in the game now, and they're capable of producing "good enough" phones (and some really good ones too) that meet many consumer needs. It's only natural that Samsung is going to lose market share in a scenario that is way more diverse and varied than in the past when it was dominant.

It's like when the iPad first came out. It was the only kid on the block for a while, and racked up a staggering market share. Then more and more competing tablets came into the picture and surprise surprise, the iPad lost market share. This isn't rocket science or some strange phenomenon, it's common sense.
 

dawheat

Diamond Member
Sep 14, 2000
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I get your point that they don't innovate like the major mfgrs do, but how do you equate that to being "crappy products"? All it comes down to is personal preference; I couldn't care less about the s-pen when I had my note 2, I couldn't care less about fingerprint scanner on my 6plus, I couldn't care less about the ultra pixel dual camera on my M7, but omit them and I wouldn't consider such phone a "crappy product" because they lack innovation. I'm just confused as to how their products are crappy when the overall package (aesthetics, functions, usability, battery life, etc) of some Chinese phones would make other OEMs blush.

Sure, they're not as talented as the major players and don't have some of the best engineers, but they have not shown in their presentation that they're averse to customers needs and wants and have, at least in my eyes, packaged some of the best phones right now in the market that are far from being crappy products.

Fair points - crappy was way too strong. Maybe "above average" is more accurate.

What I really don't want is the Android ecosystem to turn into the PC ecosystem. A competitive market kept moving more and more downstream and as margins continued to compress, product quality kept getting lower and lower. It's a downward spiral that gets worse and worse.

I want a world where Samsung, LG, Sony, even HTC stay in the game and keep Apple honest and at least under some pressure. I don't see the Chinese OEMs doing this on their own and I don't think there's any market they've shown this ability.
 

Commodus

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Oct 9, 2004
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I don't understand why there's this assumption that Samsung is supposed to retain overwhelming market share among Android phones. In early Android days there weren't many companies competing. There are way more players in the game now, and they're capable of producing "good enough" phones (and some really good ones too) that meet many consumer needs. It's only natural that Samsung is going to lose market share in a scenario that is way more diverse and varied than in the past when it was dominant.

It's like when the iPad first came out. It was the only kid on the block for a while, and racked up a staggering market share. Then more and more competing tablets came into the picture and surprise surprise, the iPad lost market share. This isn't rocket science or some strange phenomenon, it's common sense.

It's a combination of Samsung's own hubris and the mentality of some fans. At least for a while, Samsung acted as if its dominance was inevitable. Remember, this is the company that believed the Galaxy S III launch was the "event of the year," full stop -- it was more important than the Olympics.

And the fans? Well, as we've seen on this forum, there are some whose self-esteem is so tightly wound up in Samsung's success that the company "must" dominate for them to feel good about their purchases. You definitely see that with other brands, but it seems to be a little too common with Samsung. It's a phone, folks, not a popularity contest.
 

openwheel

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Apr 30, 2012
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You sound like you got some serious beef with Samsung as a brand...

I hope you realize you are exactly who you describe, for a different brand.