Is this the iPhone killer?

Reported by Motley Fool Staff
Monday, March 18, 2013
Topics in this article:
Icon Resources Ltd

Currency Converter

Mark BourisMyths bustedHome loans can seem a bit complicated and overwhelming. But it doesn't have to be. Mark Bouris clears up some common misconceptions.

The strange reality is that as much as I love my iPhone, I was hoping that the new Samsung Galaxy S4 that was released Thursday night would be the iPhone Killer that we had all been promised. I do not know if this feeling is born of an irritation with Apple‘s (NASDAQ: AAPL) poor stock performance — although I am not a shareholder — or perhaps the emptiness of an iPhone 5 that was only a minor uptick from my iPhone 4S. Maybe it is evidence that Samsung’s enormous marketing budget is having the desired effect. Based on the early information that has been released surrounding the new device, it is another significant step forward for Samsung, but the iPhone shall live to fight another day.

Details of the Galaxy S4
When Samsung boldly debuted the new flagship smartphone in its first U.S. release to date, it was immediately clear that the Galaxy S4 was full of new features that would make it a formidable competitor among premium smartphones. Despite being smaller than the Galaxy S III, the new model has a larger screen by virtue of the fact that a greater proportion of the phone’s real estate is used. The camera gets an upgrade to an impressive 13 megapixels, and it weighs less.

In terms of new features, the phone can detect when users glance away from the screen when video plays, pausing the video until you look back at the screen. Scrolling can be accomplished by either tilting the phone while browsing or through the use of various hand gestures that do not require the user to actually touch the screen. A real focus of the S4 is to allow users to more easily interact with it while performing other tasks like driving or eating. Hand gestures make it easier to scroll songs without losing focus on the road and the hover feature — whereby information is displayed when you hover you finger over an object or folder — allows you to keep your screen clean when your hands are messy.

Carolina Milanesi, an analyst at Gartner, said “[Samsung] kind of cherry-picked features that other competitors had, and then packed them up all together into one device.” While this is not a ringing endorsement, new device is packed with functionality.

The initial reviews
Not surprisingly, the initial reviews of the new device are broadly mixed. ISI Group’s Brian Marshall wrote: “In our view, the S4 possesses all the relevant new features for an industry-leading product. Most importantly, it features a large canvas (i.e., 5.0? AMOLED display) which we believe is critical as users look to converge smartphone and tablet functionality into one device.” Apple has been very reticent to enter the phablet world, so Samsung’s move squarely in that direction will put even greater pressure on the iPhone maker to consider offering such a product.

On the other end of the spectrum, Ovum chief telecom analyst Jan Dawson believes that the breadth of new features ”are good steps in this direction, but they can be seen as gimmicks rather than game changers. At this point, Samsung appears to be trying to kill the competition with sheer volume of new features.” Some complained that the iPhone 5 really was not enough of an advance, and it appears Samsung’s trying to avoid that possible criticism.

Perhaps the most notable observation about the new device came from Milanesi, who said:

The story though is more about who Samsung is and where they want to be. It is clear today that they want to play in an ecosystem game, their own ecosystem. The word Android didn’t come up once.

Particularly given the struggles faced recently by Google‘s (NASDAQ: GOOG) Motorola division, the lack of much fanfare for the Android operating system is notable. While Google does not need to own this space, much of the theory behind the Motorola acquisition was to remain relevant. As Samsung remains the only serious hardware challenger to Apple, Google investors should remain vigilant.

Foolish takeaway
It is difficult to pinpoint exactly why the Galaxy S4 is not the true iPhone killer I was looking for it to be. It may be that with all of the recent hype around Google Glass and the Apple iWatch, I just wanted more. The new Samsung smartphone is a legitimate threat to iPhone sales to be sure, and has the potential to cost Cupertino shareholders, but it has not changed the game. To kill the iPhone, a product will need to be so vastly superior that it eliminates all doubt — that is the level of superiority that Apple has secured for itself. This is the best attack yet, but Apple should get one more chance.

Tech stocks like Apple and Google aren’t the only game in town. Oil, copper, and gold continue to be in high-demand — and their popularity doesn’t look to be slowing. We’ve uncovered three companies poised to benefit from the rising prices of these commodities. Get our brand-new report — “3 High-Risk/High-Reward Resources Stocks” — FREE!

More reading

The Motley Fool’s purpose is to help the world invest, better. Click here for your free subscription to Take Stock, The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead.  This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

A version of this article, written by Douglas Ehrman, originally appeared on fool.com.

Keep reading - next article
25/04/2014 01:13Sydney, Australia. 25 April,2014
advertisement