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Samsung Overtakes Apple as World’s Biggest Smartphone Seller

129 points| aab1d | 14 years ago |businessweek.com | reply

91 comments

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[+] mtkd|14 years ago|reply
26% of the iPhone 4 was manufactured by Samsung:

http://www.economist.com/node/21525685

Samsung have for a long time been a bigger player in the smartphone market than they look from their device sales alone.

[+] tjogin|14 years ago|reply
Sure they have, and as long as we count parts and phones, rather than revenues, or better yet, profits, they will always be "bigger" than Apple, in that sense.

I have a feeling they'd rather be more profitable though.

[+] nextparadigms|14 years ago|reply
I was expecting this. Apple can't possibly match Samsung with all their smartphone price ranges, and it's only the beginning for Samsung. There are a lot more "units" to be sold in the under $150 level. That's where the biggest volume will come from.

I also expect them to surpass Nokia in all phone shipments, too (they already did in smartphones). But it might take a few more quarters. Nokia will transition too slowly to Windows Phone and Meltemi, and it's yet to be seen if they will even see as big success as they did in the past with Symbian. Many have already moved on from Nokia.

[+] technoslut|14 years ago|reply
There are other factors that did give Samsung an advantage such as no new iPhone launched by Apple this quarter. It remains to be seen what the impact is of new iPhone, Sprint availability and a 3GS that is free with a contract. Apple is predicting that they will generate $40 billion during the next quarter.

With a 'free' 3GS Apple is pretty much competing with Samsung and Android now at every price point.

[+] shareme|14 years ago|reply
20% of those numbers are iphone Samsung made for Apple due..stop talking out of your ass.. as soon as Apple buys a mobile handset firm it can.
[+] hugh3|14 years ago|reply
I'm really confused as to why some people seem to have strong feelings about this.
[+] kenjackson|14 years ago|reply
I agree. It's interesting info to know, but not something to get worked up about. MG Siegler seems to take pride in Apple making a lot of money, for example. I'm really unclear why I should get excited if Apple make $30B this year or $25B unless I'm a shareholder.
[+] hm8|14 years ago|reply
I guess this is just a way of confirming your choice with so many out there. This is similar to the Google+ and Facebook buzz that was there a some time ago.

Also, people want their favorite companies to be pitted against their closest competitor and when they emerge victorious, they have a sense of pride about it.

To end, this is very similar to the emacs vs vim or windows vs linux vs mac or the browser competition where people just want to establish their some kind of superiority over the others.

[+] diminish|14 years ago|reply
Single device strategy vs Devices with multiple sizes, keyboards etc.The first strategy makes good profit and the second strategy makes more revenuue. but long term, always the market share rules strategically..
[+] wmf|14 years ago|reply
It's clear that very small market share is not sustainable, but the market is so large that I think iOS will be fine even if it levels off at ~30% share.
[+] idspispopd|14 years ago|reply
These figures are a red herring, I'd like to know how the iPhone-equivalent models from Samsung/others are selling. The 3GS is available on upfront $0, but the plan cost is higher, which means it's not competitive to the much cheaper, albeit less-featured/powered models from other vendors. In essence this is apple replicating their 90%+ marketshare in computers over USD$1000.

As an app developer I'm more interested in how this top end pans out. I want the consumers who are willing to buy apps, and I want there to be lots of them on one kind of platform so I don't have to do the heavy lifting in making the game consistent across all handsets. I'm not making angry-birds clones that could run on minecraft redstone, so a basic level of GPU+CPU capability is needed.

Samsung's business model promotes the further fragmentation of Android, and I think this will be a bad thing for consumers(read: developers). We'll be back to the days of nokia making a different phone for every conceivable type of person there is, with only nokia or huge studios with the capability to make the umpteen variations required to make the game feel at least comparable across each handset.

If there are 80% of the market using android devices that are underpowered the only winner will be flashlight apps.

[+] The_Sponge|14 years ago|reply
That's because Samsung has a wider view of "smartphone". They release a LOT of Bada phones which they consider to be "smart", but often only mention their Android partnership when they release their numbers.
[+] YooLi|14 years ago|reply
Can anyone find Samsung's actual sales numbers? Not analysts estimates or vague percentages more. I would think if Samsung is selling as much as is claimed, they would have at least a concrete number.
[+] Mordor|14 years ago|reply
... and so the pressure builds on Apple to diversify, which is what killed it last time. Really Apple needs to invent and come up with something special, but as SJ would tell you - which idea do you pick?
[+] Tyrannosaurs|14 years ago|reply
Does it? It may not ship the units that Samsung ships but it makes far more money off the smaller number of units it does sell.

The reality is that Apple were the largest smartphone manufacturer in the world for one quarter. It would be more accurate to view the fact that they were (briefly) number one as a blip rather than see it as a major title they lost and something they need to react to.

[+] prodigal_erik|14 years ago|reply
What nearly killed Apple last time was a bad supply chain that resulted in ridiculously expensive desktops full of non-commodity parts. This time they're actually equipped to compete with efficient manufacturers, which is why their dystopian policies worry me now.
[+] rjd|14 years ago|reply
Killed it last time? sooo it had nothing to do with Microsoft , Windows 95, and the arrival of the internet?

The 90s house hold computing boom left Apple completely out of the equation, the couldn't compete on any level. Jobs turned that around by competiting where MS couldn't, with hardware and usability (through lock in).

[+] notatoad|14 years ago|reply
in what way is the pressure building? they are still very successful, and i don't see anything to indicate that their current strategy won't remain successful for a long time to come.
[+] moomin|14 years ago|reply
Apple never set out to make the most smartphones, it just kind of happened.

They set out to make the most money. Samsung are a fair distance from achieving that.

[+] ZeroGravitas|14 years ago|reply
"They set out to make the most money."

It really worries me that there's a new breed of Apple fan that actually believes this.

In reality they set out to build the best device (for affluent, white, middle-aged, American males with a taste for minimalism) and semi-accidentally became fashionable status symbols.

The crowing about making the most money was just fanboy bragging because every other stat they bragged about was slowly being eclipsed by Android. Fanboy rule number one is to make far too big a deal about anything unique about you or your enemy. Some people seem to have latched onto profit margins and run wild with it. This has gotten to the point where I'm half expecting, even here on HN, someone to come along and claim that Samsung "isn't making any money" from selling these phones.

[+] pyre|14 years ago|reply
Well, Apple fans really did set the stage for these sort of comparisons with all the hand waving about how the iPhone would be the only smart phone in the future. And their continuous need to point out market share numbers in their Internet "my favorite company can beat up your favorite company" fights.
[+] cageface|14 years ago|reply
However, if these trends continue in the longer term Apple could start to suffer from some of the same negative network effects that plagued them in the PC era. If their market share slips too far people will start perceiving them again as a niche, luxury brand too different from what their friends and family use.
[+] brisance|14 years ago|reply
Once again the media is derelict in its reporting duties by equating "shipped" as "sold". They are not the same thing.
[+] ZeroGravitas|14 years ago|reply
Samsung smartphones are selling briskly, there is no material difference in the numbers.

The month on month rise in sales, for the last year or so, has been spectacular. You can't just keep shipping phones at that pace without selling them, it's simply not realistic to channel stuff on that scale.

[+] boscomutunga|14 years ago|reply
The secret of samsung is that they cater for multiple price ranges, also the use of android is proving to be a good advantage over the now dying nokia.Despite the launch of the lumia, nokia and microsoft aren't likely to win in this race.
[+] coob|14 years ago|reply
What percentage of the profits do they take?

Exactly.

[+] ZeroGravitas|14 years ago|reply
Do you have figures to share? You seem confident, yet I'm equally confident that their profits from smartphones are large and growing quickly.

It's seems unlikely that they would be doing so differently from HTC and ZTE, much smaller players who are doing very well.

I don't know of any comprehensive numbers on the market that I'd trust, but as a snapshot Apple reported $7.3 Billion profit in July (for phones, ipods, ipads + compters etc.) up 80% from last year, while Samsung just announced $2.3 Billion just from smartphones, a yearly increase of over 100%. (This doesn't seem to include money from selling components to other smartphone makers, such as Apple).

[+] jhuni|14 years ago|reply
Well overtaking Apple is a good start, we shouldn't stop until Apple tyranny is totally wiped off the face of the Earth.
[+] dereg|14 years ago|reply
Samsung is indisputably more "tyrannical" than Apple. The corporation has unsurpassed political influence in South Korea. For instance, scumbag Chairman (former CEO) Lee Kun-Hee is a nepotist and admitted guilt to political bribery in 2008. Guess what? He paid his way out of jail time and was even pardoned by LMB in 2009.

Samsung also has tremendous media influence in the nation. The company influences the media by giving or withdrawing advertising, giving scholarships to journalists, or suing the critical media. As a result, their corporate misdeeds get swept under the rug. The company uses the press as a means to control the press rather than sell their products. Samsung accounts for almost one-fifth of the entire nation's GDP. It's no surprise they are the nation's largest advertiser.

Corporate influence in the USA is nothing compared to the influence of the chaebol in Korea.

[+] jnfr|14 years ago|reply
My problem is that all of these articles are missing a key piece of information: the number of devices each manufacturer has out on the market. Jumping over to Samsung's website, I count 14 Galaxy Smartphone devices currently on sale. What about Apple? They have on sale the iPhone 3GS, iPhone 4 and iPhone 4S. How about instead of comparing absolute values of shipments, we talk about number of shipments per device?

But is it really a numbers game? Is it quantity over quality? It's no secret that Apple has one of the most loyal fanbases out of any other tech company. Who is clamoring over wanting every new Galaxy smartphone? Who's lining up every time they release a new product?

For those who want to play the numbers game, make sure to play it properly. The iPhone 4s sold 4M shipments during its first weekend. Meanwhile, it took Samsung 55 days to sell 3 million Galaxy S IIs, arguably, their most successful Smartphone yet. Now if Samsung continuously releases new versions of these Galaxy smartphones, which they are, then obviously they will be shipping more.