Samsung’s costly mistake

As per the pie chart, Samsung has dominance over the $ 450 billion global smartphone market by enjoying over 20% market share. This makes it the undisputed leader in the global smartphone market and Apple is enjoying around 15% which positions it closely behind Samsung.

In an attempt to maintain dominance, Samsung recently launched, sooner than expected, its newest and game-changing addition to its product range, the Galaxy Note 7 phone, with blockbuster features such as iris recognition security, more powerful and faster charging batteries and high resolution screen that wraps around the edges, etc., hell-bent on beating the newest Apple IPhone 7.

This turned out to be the worst nightmare the company has ever had in its history since the battery of the newly-launched Galaxy Note 7 bursts into flames and in some cases minor injuries have also been reported. This is an irreversible damage to its reputation and according to some analysts it will cost Samsung around $ 2 billion financially to replace all around 2.5 million Galaxy Note 7 phones already shipped globally.

What caused this catastrophic failure?

According to Bloomberg Businessweek, Samsung was in a rush to launch its newest addition before Apple launched its latest iPhone 7 which Samsung claims does not have any eye-popping innovation. This made it compromise on quality and it pressurised its supply chain with tighter deadlines like never before in order to launch Galaxy 7 Note sooner than planned.

Even some suppliers have expressed their dissatisfaction about this and their employees have been compelled to work around the clock to meet these deadlines. Further, Samsung’s product development team changes the product specifications time to time and that makes them more difficult and derails already-planned productions.

This costly mistake may turn the table in the next few quarters as shown in the pie chart with Apple becoming the market leader.

Although Apple launched its latest addition IPhone 7, accordingly to media and some analysts the reaction it was received from the market is somewhat muted. The smartphone market has probably reached its saturation and is gradually becoming a cash cow.

Despite head-to-head competition and saturation, Google just launched a smartphone under the brand name Pixel which it believes will take the smartphone industry to a whole new level.

However, the question to be considered is: ‘Is there any space available for another major player like Google to compete in this industry?’ Perhaps, it follows a do-a-little-bit-of-everything strategy from driverless cars to balloons beaming internet and wearable computing, etc. as opposed to Apple which is really focusing on a very few things at a time.

However, Apple must need a new silver bullet as the prospects of this are fading away. 

(The writer can be reached via [email protected].)