Until the end of 2012, it seemed that no company in existence would be able to challenge Apple’s dominance in the smartphone market. The iconic iPhone range has literally millions of fans all over the world, with new release the iPhone 5 seeing thousands queue for up to a week in advance of the new model’s launch outside Apple stores from Asia to America.
However Samsung’s Galaxy range of smartphones knocked the iPhone off its pedestal somewhat, with the S3 finally managing to triumph over Apple as the most popular smartphone of the year.
Due to a combination of impressive updated features in the Android based S3 and the fact that critics claimed the iPhone 5 failed to differ greatly from the previous iPhone 4S, Samsung now believes that it will be able to post a fifth consecutive quarter of record breaking profits for the three months to the end of December.
While no figures have been confirmed, the South Korean firm estimates the total operating profit for the quarter will total 8.8 trillion won – the equivalent of £5.1 billion – meaning a staggering 90 per cent leap in quarterly profits from the same period in 2011.
Furthermore, analysts in the field of technology believe that this strong performance is due to continue, yielding further financial success for the biggest international phone maker. Samsung Electronics took this title from Nokia thanks to the success of the Galaxy range last year.
Chairman of Market Force Company James Rooney says; “Not only are their smartphone sales growing, they have also learned how to make a good profit on these sales.
“Given these factors, this streak of record breaking quarters is likely to continue for a while.”
In fact, rumours are circulating of Samsung’s next handset, which is set to be released in the second quarter of 2013. Experts predict that it will have an updated operating system, as well as a larger memory capacity and a higher resolution camera – although no details have yet been confirmed.
Samsung are now facing greater competition from brands other than Apple, however, as companies such as Nokia and HTC are now focusing on improving the Windows 8 system in order to appeal to a wider range of consumers. In fact, the Nexus 4 – a handset created by collaboration between web giants Google and electronics company LG – came very close to throwing a spanner in the works for both Samsung and Apple earlier this year due to its low price and Android capabilities.
Yet it may not simply be high levels of competition from rival companies that could slow the rampaging success of Samsung, as fund manager from LS Asset Management Kim Sung-Soo points out. He believes that, thanks to the rapid recent growth of the smartphone market, consumers could simply tire of the range of updated handsets consistently appearing in phone shops.
He explains; “Investors are a bit concerned that Samsung’s momentum may slow in the first half after posting a series of record profits.
“The smartphone market is unlikely to sustain its strong growth, as advanced markets are nearing saturation.”
Only time will tell whether Samsung will remain dominant in the smartphone market, or whether Apple will return with the iPhone 5S to reclaim its crown as top of the electronics heap. However, should the profit forecasts released this week be confirmed at a later date, 2013 has certainly begun promisingly for the dominant South Korean company.
Do you think Samsung will be able to continue this run of success, or will even loyal consumers switch to a different brand if a more advanced handset is offered to them for a competitive price? Are consumers becoming tired of the endless range of smartphones available to them or will the market always prove to be popular thanks to the number of people who use their phones to coordinate their lives – whether this be through their address book, Facebook or calendar and email apps?
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