Dan Ness, Principal Analyst, MetaFacts, April 28, 2021
Samsung’s laptop PC announcements
This week Samsung announced its most recent slate of laptop PCs. While Samsung may be well known for smartphones, Android tablets, and even refrigerators, its PCs have not achieved such notoriety. Samsung has a tall hill to climb to gain market acceptance with its PCs. Its latest focus is on leveraging its smartphone brand with mobile PCs that have smartphone-like attributes. The announcements went beyond the traditional PC specs to focus on smoother and more highly integrated workflows, and the benefits of a Samsung ecosystem.
Samsung’s current market position is well behind Apple’s. Among online adults in the US and UK, Samsung’s market penetration for any connected devices is in the one-third range, well behind Apple, having reached half of online adults. In Japan, the gap is even wider between Samsung and Apple. In contrast, the tables are turned in Android-dominated Germany.
With this recent announcement, Samsung is taking a few pages from Apple’s positioning. By focusing on instant-on computers, they are in part mirroring Apple’s recently announced MacBooks. Although Samsung didn’t imitate Apple’s high-production “let’s set the mood” moment, they did emphasize the decades-long question: why can’t laptops be more like smartphones? This pivotal question highlights that Samsung is appealing to its smartphone customers. More broadly, it appeals to the ready convenience that smartphone users have come to expect. This strategy makes some sense as Samsung is drawing on such strength that it has.
Samsung and Apple’s device type penetration within their base
Among the core base of smartphones, PCs, and tablet users, Apple has achieved a broader connection with its customers than Samsung.
Smartphones are the primary driver for both Apple and Samsung’s core brand footprint. For computer and tablet adoption, Samsung has much further to go to catch up to Apple. Within Apple’s footprint of customers across the US, Germany, UK, and Japan using either an iPhone, iPad, or Mac, roughly three in four use an iPhone. In the US, Germany, and UK, more than one-third use a Mac and use an iPad. Apple’s share for these devices is lower in Japan, yet still is more potent than Samsung’s share within its footprint.
Within Samsung’s core base, Samsung’s tablets have fared better than their PCs, although marginally. In the US, UK, and Germany, Samsung’s share of tablet users within its footprint is nearly 20%. Samsung’s PCs have reached less than 15% of its core base.
Samsung’s shifting dominance
Samsung has the enviable position of dominating the Android smartphone market in many countries it serves.
In the US, Samsung’s share of the installed base grew markedly from 2018 to 2020. This share rose from two-thirds to three-fourths of Android smartphone users. Meanwhile, though, Samsung’s share of the overall US installed base languished at less than one in three American smartphone users.
Germany has remained a stronghold for Samsung’s smartphones as well as for other Android devices. However, Samsung barely expanded its footprint from 2018 to 2020 while Apple made gains.
Samsung’s share has been fading in China, since Huawei, Xiaomi, and other locally produced smartphones gained share.
Samsung users by age group
Apple and Samsung have reached customers of different ages. While Apple’s overall core market penetration is skewed towards younger adults, Samsung has a more balanced customer age profile.
Apple’s iPhone is especially skewed towards younger adults, while in the UK and Germany, Samsung is somewhat skewed toward older adults.
Tablets, however, have a similar age profile for Apple and Samsung, although with Samsung trailing in most markets.
Integration and technology ecosystems
It remains to be seen if Samsung’s promises of “continuity” across devices will be delivered and received. In the past, Samsung has publicized a smoother integration between its devices ranging from Android smartphones and tablets to PCs, kitchen appliances, and voice assistants. (Remember Samsung Bixby?). While the goal of most ecosystems is to capture user’s purchases fully, the reality is that most users have a mixture of device brands and operating systems. Actual continuity means more than owning devices with the same brand.
It was promising to have Microsoft executives as part of the announcement. However, the technology industry is littered with the bones of previous integration attempts. Unless companies can control the whole stack of required hardware and software interactions, the magic bubble can burst.
Apple can claim the apparent benefit of being one company and therefore well-integrated, although the same design and technical challenges persist whether developed within one company or between many.
As to Samsung, it will need to tread lightly into the classic standards problems. How to establish a standard that is both open and closed at the same time? How to pioneer something new that will bring unique benefits against its competitors while at the same time being widely accepted and truly functioning as promised.
Looking ahead
During the April 2020 Samsung Unpacked laptop PC introduction, Samsung left out an entire class of key partners – the cellular industry. Even though Samsung touted “connectivity” and integrated 5G cellular capabilities, Samsung did not mention any carriers for any countries. Although Korea is well-established with its 5G network, many other countries are not, including the US. In addition to supporting the global jumble of cellular frequencies, technologies, and standards, and their continued evolution, the carriers themselves play an essential role in distributing, selling, and supporting connected devices.
Samsung’s directions make strategic sense, as they’re making the most of what they have. Also, Intel’s and Microsoft’s support makes sense as both companies circle their wagons against Apple. The real test is whether users will understand and appreciate the value of Samsung’s mantra of mobility, connectivity, continuity. Will buyers understand and value continuity enough to consider Samsung laptops over others?
I expect Samsung’s latest laptops to get the most traction among current Samsung smartphone customers. Android smartphone users, even those who haven’t already experienced Samsung, are also prone to be receptive. Apple’s faithful – whether iPhone or Mac users – are least likely to embrace the newest Galaxy Books.
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Indexing
PCs, Mobile Phones, Tablets, Technology Ecosystems, TUP 2020, TUPdate
Tags: Samsung, Smartphones, PCs, Tablets, Technology Ecosystems, Apple, Windows, Android, Google, Operating Systems, iOS, Laptops, Notebooks