Why Apple Should Fear Samsung's New 'Tizen' Strategy
If Samsung adopts Tizen more widely in its lineup of mobile devices - particularly if it extended Tizen onto future iterations of its flagship Galaxy and Note models - then it would cut the market share of Android.Samsung co-CEO J.K. Shin has said he'd like to see Tizen on "everything" that Samsung makes, including phones.
But another way to look at Samsung's Tizen strategy is to consider it from Apple's point of view, and to ask what Samsung wants in terms of its never-ending battle with iPhone, iPad and the iOS mobile system they operate on.
Tizen solves a pair of problems for Samsung.
- Apple has no operating system for "wearables" - smart watches, smart glasses and various connected household gadgets. Tizen puts Samsung ahead of the game in terms of building out a system for the "Internet of things." Tizen also uses less battery power than Android, according to some.
- In developing countries, Samsung's market share could easily get eaten by cheap Chinese Android knockoffs - smartphones that cost just $35 that, for low-end users, are just good enough to deter customers from spending the $700 it can cost to buy a top-shelf Samsung Galaxy Note 3. Keeping the Galaxy brand on Android could leave Samsung vulnerable to cheap competition from China.
Of course, Samsung could make a nice, cheap, competitive Android Samsung phone for the low-end market. But Samsung is a publicly traded company, and thus it needs all the profits it can get. (And as Apple stockholders know, high profits do not come from making cheap phones.)So Samsung appears to have made a tentative decision: having cornered 32% of the phone market globally - more than Apple - it now needs to make sure that its share, and its profit margins, are protected from both high-end competition from Apple and low-end competition from China.
Samsung is already ahead of Apple in many ways.
So ... consider that Samsung is more nimble than Apple in a bunch of ways.
Samsung launched first into the smart watch business. It has already unveiled three different iterations of its Gear smart watch. The last two of those devices are running Tizen.Apple has yet to leave that starting gate on watches.
Now consider that Samsung has also led the race in terms of large format "phablet" phones. People laughed when the gigantic Note phone was launched. But talk to Note users and you'll hear, repeatedly, how much they love their big screens.
Again, Apple finds itself stuck in Munchkin Land when it comes to screens. (In fact the iPhone 5 was Apple's runner-up version of a large-screen phone.)Tizen is being built by an open-source consortium backed by Samsung, Intel and a bunch of wireless carriers - and not Google. As the dominant development partner, Samsung will get to decide how quickly Tizen gets updated. It no longer has to wait for Google (which, like Apple, has not yet rolled out its wearables operating system version of Android). And the wireless carriers (Orange, Sprint and Vodafone) will doubtless support a format they've had a hand in making.
Finally, Samsung has been making smart (or somewhat smart) TVs for years. Apple has yet to sell a single smart TV screen (although it does have the Apple TV digital media player).
The $4 billion challenge to Apple.Samsung's Tizen phone prototypes have had generally good reviews from critics in part because Tizen looks and feels like Android.
This is important: Samsung could transfer its entire phone user base to Tizen and most customers would not notice. That's one-third of the planet's entire market on a brand-new operating system controlled by Samsung within a handful of product cycles.In that scenario, Apple has two competitors, Android and Tizen, instead of just one. Samsung's main challenge to doing this isn't technical. It's environmental. People don't like Apple and Android because of their user-interfaces. They like them because of what they can do - and that means apps, like Facebook, Instagram and Candy Crush Saga. While transferring Samsung's users to Tizen might be technically easy, it would be a massive political problem to persuade hundreds of thousands of Android and iOS developers to populate a Samsung Tizen App Store with all the top apps that consumers want. If Samsung cannot manage this it might end up like Windows Phone: a beautiful device that no one wants.
This, it turns out, is another area where Apple ought to tremble: Samsung's marketing budget is $4 billion, worldwide - four times the size of Apple's. The company has more than enough firepower to promise app developers exposure and media partnerships if they launch on the Tizen platform.
And Samsung itself is a media "platform," of course. Remember when Samsung paid $5 million to launch the new Jay-Z album, just like an app, on Galaxy phones? Samsung is already creating a cozy non-Apple media environment with Milk, its new competitor to iTunes Radio.It is not inconceivable that top app makers like King and Rovio - which need new revenue from any source they can get - would partner with Samsung for massive launches on new Tizen Galaxy phones.
This would leave Samsung competing against only one company - Apple - instead of a dozen other Android makers. In this scenario, Android would be left with the low-end discount market that neither Samsung nor Apple want; Samsung and Apple would instead split the high-margin premium market between them.
Apple's worst nightmare.Samsung is growing its share of the tablet market, while Apple's share - still top - is in decline. Apple once had 50% of the tablet market in 2011. Now it's barely holding on to a third of sales. Samsung, meanwhile, tripled its share in the same period.
- India records 14,545 new COVID-19 cases in last 24 hours
- Google says it will pull Search out of Australia if the government doesn't back down on the media bargaining code
- Recession in India will end latest by March, says a top economist
- Amazfit GTS 2 review – feature-rich, but there’s still room for improvement
- Social Media Platforms: The trends to watch out for in 2021