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Samsung On The Decline Imminent Doom Ahead Thanks To Weak Demand On Low End Products

 

I can remember when every phone that was not an iphone was dubbed the “iphone killer” at release. Several generations of OEM devices came out looking to compete with Apple’s mega device, but most of these devices just did not add up. I remember even my old HTC Touch Window phone 6 was dubbed the iphone killer. Boy was that a sham. Eventually Google came out with Android which at least stood up to the behemoth that was the iphone, but nothing really cut into Iphone sales until the Galaxy S4. Before you knew it Samsung had become the new top dog.

Now it appears that Samsung may be facing some financial crises that could send the company in a downward spiral. They should be celebrating the success of the Galaxy S5 instead it turns out that a long list of factors has really begin to chip away at Samsung’s profitability.

Samsung is facing its largest issue in the bargain phone category internationally. Bargain phones have kept OEMs like Motorola and Nokia alive for years. Samsung appears to have made the mistake of focusing on the flagship at the expense of global budget phones. Over delivery of smartphones led to an over abundance of devices in China and Europe where pressure is coming in from competition. Samsung made the mistake of releasing 3G devices in China when the market is heading towards 4G. Consumers are looking to future proof their purchases and are skipping the Samsung 3G devices altogether. People do not buy tablets very often, as it turns out the success of the Samsung Phablets have made purchasing tablets completely unnecessary for some consumers so Samsung is losing out on those purchases as well. Samsung may have also spent more than necessary on marketing in the second quarter. To top it all off the Korean Won fluctuations have also put a strain on the finances of Samsung.

Could Samsung already be at market saturation? Can they rebound or are we witnessing the next HTC?

Via WSJ