17th Oct 2018

How Did Apple and Samsung Come to Rule the Smartphone Industry?


Despite the existence of dozens of smartphone manufacturers, it seems that two names always top the headlines: Apple and Samsung.

If you’re planning to buy a new phone, chances are good that you’re deciding between the latest iPhone or a popular Samsung model. Though there are countless other options out there, it’s much less likely those are on your radar. Samsung and Apple are the names we all know.

The two companies are often side-by-side in their success. Tech and finance news reports seem to go back and forth each year. Which company performed better? Which sold more units?

Typically, Samsung wins out when it comes to total phones sold, but Apple often makes up for that in pure revenue. At the end of 2017, figures stood thus:

“Samsung ended 2017 with 21.9% market share in the worldwide smartphone market, according to new data released on Tuesday by researcher TrendForce. Samsung shipped more than 310 million units during the period, according to TrendForce. That was enough to top Apple’s iPhone, which secured a 15.2% market share in 2017. TrendForce didn’t say how many units Apple shipped, but the company’s own sales data over the last four fiscal quarters shows iPhone sales in excess of 215 million units.” (Source)

It’s clear that these two are often neck and neck. It’s no wonder the competition is so fierce to introduce a newer, better, and cooler smartphone!

These kings of the smartphone industry didn’t arrive on their thrones overnight, but how did it happen? And just what is it about these two companies that keeps them winning again and again?

The Stirrings of a Rivalry

In 2007, Apple released its first iPhone, effectively launching the modern smartphone industry. Just three years later, Samsung stepped into the game, with the introduction of the Galaxy S. Since that time, the two companies have grown into industry giants, leading the way in innovation and development. Today, Samsung holds the record of selling more units, but Apple dominates when it comes to profits.

These two fierce rivals have continued to expand over the past decade, remaining at the forefront of the smartphone market.

What may have started this tête-à-tête is that both companies produced remarkable phones right from the start. In fact, there was a great deal of consternation that the Galaxy S, appearing 3 years after the original iPhone, had a little too much in common with its opponent. Apple accused Samsung of blatantly copying their phone design. Some of the features, they claimed, were simply too similar to pass off as coincidence. And furthermore, Samsung was an Apple supplier!

This fight over patents waged on for years, eventually coming to a close earlier this year when the two smartphone behemoths reached a settlement. (The details of this settlement, by the way, are not known).

But despite the legal battles, both Samsung and Apple have continued to create and release remarkable phones over the intervening years. During this time, many other manufacturers’ innovative smartphones have come and gone, but Samsung and Apple have always remained ahead.

A Shiny New Apple

Apple is known across the world as a household name.

Apple can’t be thought of without also thinking of Steve Jobs---one of the leading innovators of our time---and his work and vision clearly helped set the company on a good track. But where Apple really exploded was when they essentially reinvented the smartphone. Since then, they’ve continued to be a leading brand and there are a lot of reasons for this success.

For one, Apple highly prioritises ease of use when it comes to products. Customers must be able to effectively use Apple’s devices, or else they won’t sell. Apple places tremendous focus on this, and it’s been apparent since the launch of the very first iPhone. A streamlined, intuitive interface has always been a hallmark of the iPhone, and it is a setup that really did pave the way for other smartphone manufacturers.

Over the years, Apple has retained incredible brand loyalty. In a 2017 study, 92% of iPhone users indicated that they are either "somewhat likely" or "extremely likely" to upgrade to another iPhone. Respondents for other manufacturers did not show such consistent numbers, which indicates that people seem to become avid iPhone users for life. In fact, most of us probably know someone who is entirely devoted to their brand, and who won’t even consider looking at anything else.

Apple has always kept things simple for users. There aren’t an endless number of choices or a range of phone models to compare. There is only the iPhone and the newer iterations of it as they are released. This makes it incredibly easy for users to select a device and then stick with it. They can feel confident that the next version will be very similar to what they already know and love. This familiarity and expectation of quality is something Apple has commandeered, and the success of it is evident in their sales figures.

Because of this, Apple can focus on really making the iPhone the best it can be, too. The company fares best in the high-end, luxury market because they seemingly put all of their energy and skill into building a fantastic new iPhone. Not to mention, Apple has developed a large suite of related tech and tools that pair with iPhone, giving them a further edge that few other manufacturers can compare with. Except perhaps Samsung.

A South Korean Tech Giant

Clearly, Samsung is also doing quite a bit well in their industry.

But Samsung is successful not just in a single area (smartphones). Rather, its success is spread across the industry. They’re known for excellence in screen technology and chip development as well as the production of other household electronics.

When it comes to smartphones, Samsung devices are certainly popular. And like iPhone users, there is a core group of devoted Samsung fans that continue to upgrade to the latest products. Samsung wins with sales of handsets, and this is likely because they tend to offer a lower price point for their high-end flagship phones. (For instance, the iPhone X is routinely listed for a couple hundred more than the similar Galaxy S9). This good value could make the high-end Samsung products more attractive to buyers on a budget, but Samsung also offers a much larger range of phones for customers, including many in the mid-tier and budget range. Some of these models are extraordinarily popular, no doubt helping to account for Samsung’s impressive sales numbers.

Yet they also have far more competitors in this market. Samsung struggles more to keep a strong-hold in mid-tier and budget smartphone sales because there are many more players in this game. Fewer companies offer alternatives to the iPhone.

Samsung stays ahead perhaps by having a finger in several different pies. Their investment in other electronics aside from smartphones may help them to diversify and retain their leadership in the tech field. Additionally, Samsung supplies some chips and other resources to Apple, so they indeed profit off the gains of their competitor.

Samsung operates differently than its rival Apple. While Apple employees often compete against one another in design development, Samsung was an early adopter of TRIZ, a methodology for systematic problem solving that originated in Russia. This has expanded into a repeatable methodology that works for the company again and again. Not only is this advantageous, but Samsung is always on the hunt for the top tier talent. They do a great job spotting and recruiting leading minds, essentially forming a ‘creative elite.’

Samsung is staying ahead of the game with innovative knowledge of their own. They’ve historically experimented with larger screens, and they were also the first to incorporate AMOLED screens in their devices. Not only that, but Samsung did a fair few things before Apple did.

Of course, Samsung may never escape one blight on its reputation: the accusation that they’ve copied Apple. But whether you believe that or not, it is evident that Samsung is making the most of what they’ve got.

What Can We Expect in the Future?

First class products serve to bring big gains to both Samsung and Apple, but these companies cannot credit their success solely to their devices. In any business, it is a myriad of elements which contributes to company achievements. These will contribute to the next stage of competition for these two.

It will be interesting to watch these two rivals over the next several years, particularly as more budget-friendly manufacturers seem to be entering the scene. It’s just possible that a smaller player could disrupt this duo of smartphone kings.

Do you prefer Apple or Samsung? Why?

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