Posted : 2015-08-12 15:58
Updated : 2015-08-12 19:21

Samsung aims for rebound with new Galaxy

Company starts pre-order campaign from Aug. 20

By Kim Yoo-chul

After a rather unimpressive performance so far this year, Samsung Electronics' handset unit is aiming for a rebound in profits with its Galaxy S6 Edge Plus (Edge Plus).

It remains to be seen whether the Edge Plus will fuel stronger momentum for the world's top producer of mobile phones.

Worse still, consumers' are less willing to pay more for premium phones because of a massive influx of cheaper models with good features.

To cope with the changing business climate, Samsung Electronics plans to send a clear message to investors Thursday, when it unveils its newest models including the Note 5 phablet, that it has the ability to lead the market despite growing challenges, officials said.

"In terms of profitability, the company hinted at earlier-than-usual price adjustments centered on the S6," Bernstein Research senior analyst Mark Newman said in a report. "New high-end products are introduced at a faster pace, while raising marketing estimates for new launches across all price segments."

The newest Samsung handsets will be introduced in New York in what Samsung officials say was "strategic decision" representing its commitment to raise its market share in North America.

Over the last few years, Samsung has unveiled its new phones at the annual IFA fair in Berlin, Germany, in September.

But this time, the company scrapped the IFA fair in a bid to gain an earlier head start ahead of Apple's next iPhone introduction, due early next month.

Samsung was the top smartphone manufacturer during the second quarter of this year in all regions across the globe apart from North America, according to research firm Strategy Analytics.

The share gap with Apple had narrowed to 6 percentage points by the second quarter from 20 percentage points in the fourth quarter of last year.

"Samsung has acknowledged its growing worries over the profitability of its smartphone business," an official said Wednesday.

"The market is being reshaped with a lot of alternatives. As a new order prevails, the main issue is how to keep the momentum and to persuade investors and consumers by releasing new models with new form factors," he said. "If Samsung loses support from key markets, then it will be a disaster."

In line with the North America-focused strategy, the Note 5 will be available in selected markets including countries in Asia and North America.

"Samsung's marketing plan was changed to spend more in markets where the company was facing tough challenges," another official said.

The Edge Plus is expected to have a 5.7-inch display, an Exynos 7420 processor supplied by its semiconductor division, 4-gigabyte DRAM and 300 mAh battery capacity, said officials at parts suppliers.

Samsung did not respond to a request for confirmation of the main features of its upcoming phones.

Korea's leading carriers ― SK Telecom, KT and LG Uplus ― plan to start taking pre-orders for the Edge Plus from August 20.

"The sale of smartphones during the third quarter will increase from the second quarter," the company said. "Pricing strategy will be flexible according to market situations."

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