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{complink 4751|Samsung Electronics Co. Ltd.} is one of the more vertically integrated companies in the consumer electronics marketplace, but the Korean company still managed to run into supply problems with a key component used for its latest smartphone, the Galaxy S III.
News reports indicate Samsung failed to anticipate the roaring demand it has now recorded for the Galaxy S III and was unable to ship as many as 2 million units of the device to telecom service providers in Europe, North America, and Asia.
Samsung expects to ship up to 10 million of the Galaxy S III in the current quarter, making the device its fastest seller. The launched the Galaxy S III ahead of the likely introduction of an updated Apple iPhone expected in the fall, and the success of Samsung's latest device should help the company continue to maintain its position as the world's biggest vendor of both smartphones and wireless handsets.
In an attempt to smoothe problems in its supply chain that contributed to the inability to meet overall demand, Samsung said it sent employees to all component suppliers to ensure delivery targets were being met. Reuters reports that the company expects soon to put the component shortage problem behind it. Analysts who slashed Samsung's smartphone shipment for the June quarter believe the company should recover quickly in the third quarter and have raised their estimates for the company.
Samsung failed to anticipate the roaring demand it has now recorded for the Galaxy S III and was unable to ship as many as 2 million units
@Bolaji, looking at the pace at which Samsung sold its Galaxy S III mobile do you think Galaxy S III is true competitor to iPhone ? Do you expect iPhone 5 release will impact the sales of Galaxy S III ?
Maybe that will even help the SIII… “sorry, we ran out! it sold out in a day” That would leave the potential buyers wanting it even more. Although I wouldn't expect Samsung to have this sort of issues, they're too big, too much experience.
tirlapur: I don't think that Samsung S III will be a competitor to the iPhone because both of them respresent two distinct market segments based on the mobile OS platform. One represents Android and the other the iOS. Since, in my view the consumers are segregated on basis of the platform and there will not be many who will be willing to switch platforms. I think SIII will not impact the sales of the iPhone or vice versa.
Syed, Sorry but I believe the Samsung Galaxy S III is a direct competitor to the iPhone as the iPhone is a direct competitor to the Samsung Galaxy S III. Everytime a consumer selects one device in place of another, the ignored device losses out. Samsung is the leading smartphone vendor in part because of the Galaxy series.
It sounds like Samsung is taking the right steps to address their supply side issue, and will do very well in the next quarter.
I think SIII will not impact the sales of the iPhone or vice versa.
@syedzunair, Everyone is eagerly waiting for iPhone5. If iPhone 5 features disappoints then I think this will give further boost to Samsung galaxy sales.
@syed, as a consumer i personally do not care which platform i am using in smartphones as long as it can meet my basic requirements: money, compatibility with other hardware, apps, some of my friends should use same OS, features etc. And due to lack of enough choices in high end smartphones the only competitor to iPhone at this stage is Galaxy S series.
Even the price of galaxy s3 is almost same as iPhone, still this phone has received many compliments from the gadget savvy customers. Looks like they will never have enough of the features.
Bolaji, there may be a difference of opinion. I proposed that they are not direct competitors based on the assumption that Apple consumers most often buy only iPhones (at least from what I have seen). So, the market share that Apple has is constant if not growing with every iPhone release.
However, broadly speaking in the mobile market both of them are direct competitors like you said based on the features and price range.
@tirlapur: I agree with you that most people are waiting for the iPhone 5 launch. However, I am not sure if the features dissapoint the market would go for SIII. Over the years I have barely seen people leaving the iPhone for other phones. So, probably I might be an iPhone lover but I think iPhone 5 will still do good business.
@Himanshugupta: You are certainly correct about consumers making the purchase decision on the basis of cost, compatibility, OS platform and their friends circle. For some one of these factors would weigh much higher than it does for others. Similarly, for most Apple users that I have seen the platform, i.e. iOS is the decisive factor. I may be wrong but this is what I have actually seen here.
IPO activity stalled at the end of May, because ongoing global macroeconomic concerns increased market volatility and made investors skittish.
@Barbara, I think one more reason why IPO activity stalled is because investor lost confidence in IPO market after Facebook's listing. Many investors have realised now that most of the IPO's are overpriced and they can buy the same stock at lower price after its listing.
@tirlapur
I agree. Because of the Facebook situation, I think investors have become cautious, concerned about media hype and the potential for manipulation.
Might we also be seeing some seasonal slowdown as people are more focused on summer vacations etc. Summer is traditionally a slow time for the stock market.
@Eldredge, as far as facebook's IPO is concerened, the things are unfolding and it seems that even its underwriters, Morgen Stanley, did not think that $38 was a right pricing. Inverstors will inverst in anything that makes profit or has a chance to make profit.
@FLYINGSCOT
“Summer is traditionally a slow time for the stock market.”
Maybe, then when do you think we should be expecting the next big IPO, in two or three months perharps?
Ever heard of http://www.eventbrite.com/?
According to this prediction, Online ticketing platform Eventbrite will potentially file for IPO in late 2012. Eventbrite recently sold its 50 millionth ticket in Feb. 2012. It earned $50 million in a funding round last May 2011. Apparently it will not be as big as FB's, but we will have something to talk about.
True. The smart investors always weigh the risks against the potentail.
I do think the global economy is behind the hesitancy in IPO, but Facebook was so badly mismanaged from the get-go, I think there has also been a crisis of faith. First, the price came in under estimates. Then, NASDAQ messed up. Then, of all things, NASDAQ offers to pay for its mistake…so what's the point of gambling in the market if you can get direct payment from NASDAQ?
IPOs happening everywhere isnt it ? But a good sign to see the market being a bit coold down. Otherwise the shae will effect the busines
Well I think its more of a hype rather than the sales turnover for s3. They created the hype and people are falling for it. A typical marketing gimmick but a good one.
@Barbara – I agree. The combination of the gloabal economy with the issues that surrounded tje Facebhook IPO undermine the faith of investors and increase the percieved risk for future IPO offerings, at least for awhile. But when the economy shows signs of improving, that qwill be short-lived.
@nimantha.d: Apart from the marketing gimmick it has to do with the record breaking sales that SII did in the previous year. People are now increasingly trusting the Galaxy S brand and want to try out any new version that is available on the market.
I recently read an article that sharply criticized some of the companies that discussed going public. Similar to the bubble of 1999/2000, there are a bunch of “me-too” companies that are really just apps, not full-fledged businesses. I think Instagram–which I'm not sure ever went public–was one example of that type. Rather than revolutionize digital photography, it lets you manipulate photos you've already taken. That's already been done–it's called Photoshop. It's possible they have a mobile technology that I've missed: that certainly is the next frontier when it comes to pictures.
Well otfo me. I feel Apple is the best. I think its just a matter of time until apple compes with the latest. Untill then S3 will be on top. Anyway thats how the market works.
I agree with you. The market has its own highs and lows. Therefore, probably SIII will rule the Android market right after it is launched.
I think S3 is not that good as its been shown by Samsung when you compare with the technology and the ability of Apple.
People are now increasingly trusting the Galaxy S brand
@syed, I totally agree with you. Galaxy brand is in the market from couple of years and it has some great features. Best part about Samsung products is that conumers are getting the best features at reasonable cost. I am sure Galaxy is real threat to Apple iPhone series.
I think S3 is not that good as its been shown by Samsung when you compare with the technology and the ability of Apple.
@nimanth.d, I have read many positive reviews about samsung S3. It has great performance, excellent camera quality, stunning display and other rich features.I am not sure why you think its not comparable with Apple ?
@Tirlapur, thanks for agreeing with me here.
Like I said earlier the Galaxy brand is gaining momentum in the market because it caters to all market segments, i.e. from low end smartphones to high end SIII series. And, with a comparitive pricing model it seems to be doing well in the market. It may be a threat to the iPhone but I personally think that not many iPhone users will switch to Android. I have a few friends who are iPhone enthusiasts and having asked them about switching to Android, I have always got a negative answer.