Apple Versus Samsung: Part Two

Apple 5c smartphones

Apple Versus Samsung: Part Two
| Published March 19, 2014|

By Thursday Review staff


Just days ago we posted a brief report on the increasingly tight battle between the two top smartphone producers, Apple and Samsung.

Apple’s handheld products, which cost a little more, nevertheless carry a cachet favored by those who are adherents of all things cool and stylish, which means Apple, sort of by default. Samsung is preferred by millions more who simply want the functionality and versatility of many of the same features, but without spending the extra $100 to $200 for the status of Apple.

Close behind, are HTC, Nokia, LG and others—including several second-tier companies intent on making even cheaper smartphones in an effort to stake a claim in the ever-expanding markets in developing nations (India, Brazil, Indonesia, the Philippines, Mexico, Vietnam, Egypt), where economic growth will make it possible for many millions of people to purchase cell phones. Even while Apple’s sales inch up at the expense of Samsung, Apple may face intense threats on its flanks from the start-ups making the cheaper phones.

Apple’s response? The California-based company will supplement their product line by producing a cheaper version of their 5c smartphone, which, Apple hopes, will still carry the cache of the iPhone while also being affordable to buyers worldwide. Apple intends to market the new model first in the U.K., Germany, France and Australia for starters, and it will also begin selling it very soon in China. The newer version of the smartphone is encased in an inexpensive plastic body and uses slightly cheaper internal components. Apple’s hope is that the new phone will break through the price ceiling many low-end buyers hit when first testing and comparing phones, apples to apples (pun intended).

The rapid expansion of the Asian markets means there is room for growth for both Samsung and Apple—and their competitors—over the next few years. Industry analysts expect China, Vietnam and Thailand to add as many as one million new phone customers in the upcoming quarter. Sales have also greatly accelerated in Europe, the Middle East and former commonwealth nations such as New Zealand and Australia. Even the conservative estimates suggest that new smartphone sales could reach tens of billions of dollars within the next two years.

Apple says it does not yet plan to make the cheaper smartphone available in the United States, where its sales are solid.  U.S. users often do not pay full price for the phones since North American carriers like Verizon and AT&T offers phones free, or at low cost, if the user signs a contract to keep the service for a fixed minimum period of time. Such arrangements are rare in overseas markets where cell phone users must purchase the equipment.

Related Thursday Review articles:

Apple Versus Samsung: A Global Battle; Thursday Review; Wednesday, March 19, 2014.