ATIV Q_Blue (Photo credit: SamsungBE)
Just prior to the launch of its new ATIV tablet range, announced June 20th, Samsung was briefing journalists on the challenges it faces in the global tablet market. According to Korea Times, Samsung was puzzling over its failure in the US market, where
Samsung’s tablet share in the U.S. is hovering around 13 percent, well below Apple’s 50 percent (globally the split is 17% : 36% in Apple's favor). Our technicians and management are now trying to come up with a different approach,” an anonymous Samsung executive told the Korea Times.
That different approach was partly unveiled in London the next day - higher quality Windows tablets, alongside its Galaxy and Note range! It seems to be part of an emerging trend - to accentuate Windows as the operating system of choice, in place of Android.
Observers of the telecoms scene will have noticed Telefonica yesterday proposed something similar. Going forward they are putting more of their marketing muscle behind Microsoft.
This is Telefonica's take on it, quoted on CNET....
"An associate partner such as Microsoft is chosen as a result of its operator-focused business approach. The Microsoft business culture is based on a model of value creation through its partners' associates, which fits in perfectly with our culture and also with our way of doing business."
Samsung however is also launching one tablet that allows users to access Android content via a Windows OS (the ATIV Q). So in a sense it is less Android but also more, bringing Android into the Windows arena, in an effort to appeal to Apple's devotees and to new customers.
Yet, Samsung acknowledges that Windows tablets are not selling well - they launched the ATIV range last year. But there is one area of the OS market where Windows is growing market share, and that is in the US smartphone market. The reason is that people who are new to smartphones are tending to opt more for Windows, whereas people seeking a replacement opt more for iOS or Android. Samsung needs to appeal to people who are new to tablets and take some of that gloss over from smartphones to tablets.
The problem it perceives is a lack of good content that will let Samsung compete with Apple in the US. In South East Asian markets, it has opted for a game-centric platform with its smartphones, having launched a games social networking hub that draws people into the Samsung world. While Android gives it content, the revenues go to
And Windows is not giving the Korean company enough of a content option. This time last year Samsung was very public about its dissatisfaction with Windows 8.0 (and even this week claimed Windows was doing nothing to halt the decline of the PC).
As well as using Windows, its new tablets are also using Intel processors. This suddenly starts to look like a more American product. That might help.
But all of this could come to very little for Samsung. What is has done with the ATIV Q is give it the highest resolution screen of any tablet, anywhere and that will mean an expensive product (thought to be in the range of $699).
The US tablet market is already nearing saturation at the high end. As Chuck Jones pointed out here on Forbes: "The Pew Research Center has been tracking tablet ownership from May 2010 when it recorded that 3% of American’s 18 years and older owned a tablet. From its most recent survey in May of 2,252 adults 34% of American’s owned a tablet, almost a doubling from April 2012." But that figure goes up to 59% for families with an average income over $75,000.
The game is moving towards the budget device, Samsung’s specialty, though Samsung still wants a part of the high end action.
While one of its biggest problems is sourcing content to make its tablets attractive to a US consumer base, Samsung’s ATIV Q solution is still very hardware based, except for the addition of Android, as if Samsung is stuck in two minds about what to do. While the dual OS approach is interesting, then, it might also reflect a lack of decisiveness, which could also explain why Samsung is stalling in key markets.
It needs a bigger play, if it is to take Apple and the iPad on in the US, but instead is tinkering around with attributes that are available also to commodity producers. Samsung needs a deeper brand and a big step forward. The ATIV Q is neither of these.
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