“You can draw your own conclusions about what has been said in the courts with the ongoing patent litigation between the two bitter rivals, but Samsung still had to execute its business. Samsung figured out what Research in Motion, Microsoft and Nokia was not able to understand – if you were not going to win in Apple’s market, you had to create your own,” Richard Saintvilus writes for Forbes. “Samsung understood Apple’s ecosystem better than other rivals. It also appreciated the fact that it was never going to attract Apple loyalists to buy Samsung phones. It’s like driving a BMW for years and expects Honda to try to win that customer over – It’s not likely to happen.”
“So Samsung decided to market to those who were only looking for Honda’s price tag and offering them all the trimmings. Essentially Samsung created a showroom where phones of all types with “Apple-like features” could appeal to a population that did not have ‘Apple-like money,'” Saintvilus writes. “What’s more, Samsung was always ready to drop its prices lower if it felt it had to, whereas Apple kept its price point the same. Again, this is because Apple operates with the mindset that BMWs sell themselves. It’s hard to fault Apple for this stance – particularly as it is growing revenues year-over-year at an average rate of 30%.”
Saintvilus writes, “Samsung is now #1 in device sales – so what! If Apple wants to regain the top spot all it has to do is drop the price of its phones and tablets and watch all of the ‘Samsung enthusiasts’ rush into Apple stores. Though it’s margins would decline, it would still be the world’s most valuable company. But I don’t see why investors would want this. Likewise, Apple have suppliers all over the world fighting for its business, and it has no interest in entering Samsung’s low-end market. What’s the benefit of being the best selling device and produce no earnings per share?”
Read more in the full article here.
MacDailyNews Take: Apple rakes in 71% of the world’s smartphone profits.
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