Samsung’s Galaxy S4 Fires First Salvo at IPhone DominanceJungah Lee and Scott Moritz
Samsung Electronics Co. fired the first of three smartphone salvos this year aimed at hurting Apple Inc. in its home market, releasing a bigger and faster Galaxy S4 that reviewers said may only glance its target.
The device announced yesterday at New York’s Radio City Music Hall is lighter than predecessor S3 and has software to track movement of the eyes and waves of the hands. The Galaxy S4 will be able to take photos in two directions, monitor sleeping habits and translate commands into different languages as the South Korean company tries to lure customers in a slowing global smartphone market.
The handset, with a 5-inch screen and 13-megapixel camera, goes on sale in the U.S. on April 26 with carriers including AT&T Inc., Verizon Wireless, Sprint Nextel Corp. and T-Mobile USA Inc. The Galaxy S4 is among three high-end smartphones Samsung is releasing this year after being overtaken in the U.S. by the iPhone 5 in the fourth quarter.
“There was no ‘Wow’ factor, it only proved to the world that it’s getting harder to make a difference on the hardware side,” said Kwon Sung Ryul, an analyst at Dongbu Securities. “But the number of carriers that will offer Galaxy S4 has increased from that of S3, so the overall sales are expected to improve.”
Samsung declined 2.6 percent to 1,480,000 won in Seoul trading, its biggest decline since Jan. 28. The company is down 2.8 percent this year, compared with an 0.8 percent decline in the benchmark Kospi Index.
Some investors are in a “sell-on-news mode” now that the Galaxy S4 has been unveiled, Lee Jin Woo, a fund manager at KTB Asset Management in Seoul, said today. The phone’s features are in line with what the market expected, he said.
Samsung’s other phones this year will include a new model of its Galaxy Note and a device using the Intel Corp.-backed Tizen operating system. The latter device will be released in August or September, Lee Young Hee, executive vice president of Samsung’s mobile business, said during an interview in Seoul.
“The story today is more about Samsung as a company and where they want to go,” said Carolina Milanesi, an analyst at Gartner Inc. who attended the S4 unveiling. “They’re aiming at world domination through their ecosystem, and there was no doubt about that left.”
In the U.S., the S4 will run on the latest version of Google Inc.’s Android operating system and be powered by Qualcomm Inc.’s quad-core chip so it can handle multiple tasks simultaneously. The phone will use Samsung’s new Exynos 5 Octa processor in other countries, including where fourth-generation, long-term evolution technology is more widely deployed.
The S4 compares with a 4-inch screen for Apple’s iPhone 5, which also boasts a dual-core chip and an 8-megapixel camera.
“The Galaxy S4 may not offer the dramatic leaps we’ve come to expect from each new generation of Samsung smartphone,” said Mike Gikas of Consumer Reports. “It does, however, cram a remarkable number of tech-forward features into a relatively svelte package.”
Tong Yang Securities in Seoul expects Samsung to sell at least 60 million Galaxy S4 devices this year, bringing its total smartphone shipments to about 303 million.
The new S4 will be sold into a $358 billion global market that is approaching saturation. Growth is projected to slow to 9.8 percent in 2017 from 27 percent this year, according to data compiled by Bloomberg Industries.
Apple’s sales growth last quarter was the slowest in more than two years, a sign the iPhone is losing its edge over other smartphones, said Park Hyun, an analyst at Tong Yang Securities who doesn’t expect a new iPhone until mid-year at the earliest.
Since the iPhone’s debut in 2007, the Cupertino, California-based company has held one big phone unveiling a year, with the new product hitting the market in summer or fall.
Suwon, South Korea-based Samsung became the largest smartphone maker last year, overtaking Apple. Samsung had 29 percent of global smartphone unit shipments in the fourth quarter, compared with 21 percent for Apple, according to data compiled by Bloomberg.
Besides contending with the iPhone, Samsung has to fend off Chinese rivals offering handsets for $100 to boost growth in emerging markets. The current Galaxy S3 sells for about $200 in the U.S. with a two-year contract through AT&T’s website.
The S4 will also debut in Hong Kong and South Korea on April 26 before reaching 155 countries through 327 mobile carriers, including Deutsche Telekom AG and Vodafone Group Plc.
Competition from Apple and new devices from BlackBerry and Nokia Oyj is pressuring Samsung to add new software features to maintain its market lead. These include a function to detect facial movements and let users control the screen by looking in a certain direction.
The S4 features a dual-facing camera that combines images of the subject and the picture-taker into one frame along with capturing sounds and voices at the moment a picture is taken. Another feature detects wrist movement, letting users scroll the browser or sift through e-mails without touching the screen.
The “Air Gesture” feature allows a user to accept a call, change a song or scroll a Web page with a wave of the hand.
“If you’re looking for Samsung’s new Galaxy S4 to define a novel new era of smartphone greatness, it’s time to temper your expectations,” CNET said. “Very few of the extensive list of enhancements stood out as a killer, must-have, cannot-possibly-live-without feature.”