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Samsung Is About To Mess With The Winning Formula That Made It Dominant
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Samsung mobile CEO JK Shin.
One of the oldest criticisms of Samsung used to be that it'll try anything and everything at least once to see what resonates with consumers.
So far, that strategy worked best for Samsung with Android. It now sells more smartphones than any other company and it's the only one making profits in mobile besides Apple. Samsung finally found the one place where it leads everyone else: Android.
But at a time when Samsung is on top, it appears to be going back to its wild experimentations, instead of putting its head down, solidifying its position, and perfecting what it knows already works.
According to a Reuters interview with Samsung's senior vice president of product strategy Yoon Han-kil, the company plans to launch more devices this year running a variety of different operating systems instead of relying primarily on Android.
The first is a new high-end smartphone running Tizen, an open source operating system developed by Samsung, Intel, and a few other partners. Tizen looks and feels a lot like Android, but would theoretically give Samsung more control over software and services instead of relying on Google. The odds are against Tizen becoming a big success like Android or iOS. But if it does work, Samsung would have the same kind of control over its mobile ecosystem that Apple does. To make it work, however, requires a departure from Samsung's previous strategy — to make the best phones for Android and thus to dominate the Android phone market.
There are also reports that Samsung will launch a new Windows Phone soon.
Next, there are wearables like smartwatches, which Samsung and a bunch of other companies bet will be the next big thing in mobile computing. Last year's Galaxy Gear smartwatch was powered by Android. It launched to poor reviews for being too difficult to use, too expensive, and having limited battery life. So Samsung followed up a few months later with the Gear 2, which is powered by Tizen and launched along with the Galaxy S5. Then there's the Gear Fit, a fitness tracker/smartwatch with an attractive curved glass touchscreen. That device is powered by an unnamed operating system with watered down features.
Finally, Yoon said Samsung will release yet another smartwatch later this year that will run Android Wear, the new operating system from Google designed for wearable devices.
So that's three different operating systems for Samsung's smartwatches (Android Wear, Tizen, and whatever is on the Gear Fit) and three for Samsung's high-end smartphones (Android, Tizen, and Windows Phone).
Samsung would say it's offering all these different operating systems so consumers have more choices, like they do with Samsung's smartphone and tablet hardware. But diversifying hardware designs isn't the same as diversifying the operating systems you use to power that hardware.
Tizen, for example, has a very slim chance of ever becoming as mainstream as Android or iOS. It still lacks developer support, meaning users won't get all the apps they want. Today's high-end smartphones are basically on par with each other as far as features go, so the only true differentiator is app selection. It's the lesson BlackBerry learned last year when BlackBerry 10 failed, and the problem Microsoft is still struggling to adapt to with Windows Phone. As good as it would be for Samsung to wean itself off Android, it's not going to happen with so many users already locked into Google's apps and services.
As for wearables, the space is way too young to make a call on which platform will win. If I had to guess based on the assumption wearables do take off, the winning platform won't look like anything that's out there today. So far, smartwatches can deliver notifications to your wrists and run some basic apps, but they still mimic what your smartphone already does, leaving very little impetus to spend an extra $200.
Maybe Samsung is experimenting with so many different wearable platforms with the public in order to figure out which one (if any) can become mainstream. Or, perhaps it's waiting for someone else to make the breakthrough first.
In the meantime though, it seems like Samsung can't decide what it wants its future mobile devices to look like. Yet it is spending money on platforms that it doesn't yet dominate. That's a risk because it's easier for Samsung to support and defend its Android dominance than it is to create new, specualtive, risky markets from scratch.
But that's what Samsung seems to be doing anyway.
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