Is Samsung too dependent on Android?
Posted on 3 May 2012 at 14:37
Samsung is the world's largest smartphone manufacturer and biggest user of Google's Android operating system. And, for some, that's the problem.
Samsung's meteoric rise - in the first quarter of 2011 it shipped fewer smartphones than Apple, Nokia or Research in Motion, but is now market leader - has handed it a dilemma. Does it risk becoming a commodity manufacturer of hardware, squeezed like the PC makers of old between narrowing margins and those who control the software that makes their devices run, or does it try to break into other parts of the business - the so-called mobile ecosystem?
"It comes down to this sense of what it is they want to be," said Tony Cripps, principal analyst at Ovum. "Do they really want to be one of the power players or are they happy enabling someone else's ecosystem?"
To be sure, Samsung isn't in any kind of trouble, and isn't likely to be so any time soon. Later today, it will launch the Galaxy S3, the latest addition to its flagship range of smartphones. Juniper Research expects Samsung to remain the biggest smartphone manufacturer this quarter. The next iPhone upgrade is expected around the third quarter.
"Android has done wonders for them," says India-based Gartner analyst Anshul Gupta.
Do they really want to be one of the power players or are they happy enabling someone else's ecosystem?
But still the company has its critics. They worry that Samsung has yet to address the central contradiction of it making devices that use someone else's operating system. By licensing the free Android OS from Google, Samsung saves itself millions of dollars in software development costs and license fees, but leaves itself dependent on Google.
Horace Dediu, a former analyst for Nokia who now works as a consultant, said a similar debate went on at Nokia in the early years of the smartphone. The conclusion, he said, was obvious: Microsoft had shown that whoever owned the operating system could relegate every hardware manufacturer to be a commodity player.
"So it's a puzzle to me now, years and years on," he said, "to see companies like Samsung continuing to operate within the operating system and ecosystem that other vendors control."
Nokia and Windows
Samsung, of course, is not alone. Nokia itself has abandoned its own operating system, Symbian, in favor of Microsoft's Windows Phone. But the consequences for Samsung and other Android manufacturers are visible: While each has customized the Android interface, these are "veneers", in the words of Dediu, which "dissolve as soon as you jump into an application of the core platform."
These tweaks also contribute to "fragmentation". As Google rolls out updates to its operating system, they must first be tested and adapted by manufacturers against their own customisations before being pushed out to the handset. This slows down the update process and means many users are stuck with earlier versions of Android. Almost two thirds of Android devices, for example, run Gingerbread, a version of the operating system that was released in late 2010.
This further weakens Samsung's efforts to differentiate its phones beyond merely the look and hardware specifications. Analysts say Google's efforts to reduce fragmentation by limiting what can be altered in more recent versions of Android compounds such problems. Also, smartphones look increasingly similar as they shift from keyboards to touchscreens.
All this creates a conflict of interest between the two players that at some point may burst into the open. While Samsung says it has welcomed Google's purchase of Motorola, because of the US firm's commitment to supporting Android and its partners, it has also taken steps towards some degree of independence.
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This is the fundamental issue. Lock-in maximises return but deprives consumers of choice. As the article seems to be analysts giving soundbites, I'm not going to delve deeper - but just say; "Linux".
By dubiou on 3 May 2012
Korean Mindset rules
Samsung has made a success of making money off the back of other people's technology. Why would they change now? From TV sets, to monitor screens, to PCs and phones, they have just done what Koreans have done for centuries - led the Asian copyshop brigade. If phones get too difficult, they'll move onto the next 'Big Thing' without blinking.
By SwissMac on 3 May 2012
In what way does "Lock-in" deprive consumers of the choice of a simple, working device and ecosystem? If there were no such environment around, that would be one less choice for consumers - that of a system they don't have to worry about! lol!
By SwissMac on 3 May 2012
Samsung are innovators as well not just copiers. We have them to thank for the design and patenting of computer memory (DDR, DDR2 and DDR3, with DDR4 around the corner).
Samsung also invented and patented many of the modern screen technologies we rely on today, including key parts for LED backlighting, OLED's and AMOLED screens used in smart phones. Plus emerging technologies such as flexible screens.
Also lets not forget that many of the key parts of Apple devices are licensed from or are supplied directly by Samsung. Without their innovation and hugely successful fabrication processes there would be no high-resolution screen in the iPad 4!
By skarlock on 3 May 2012
Stupidest article ever.
All these different manufacturers providing different phones with the same OS gives us consumers a huge variety for what we actually want with all our software switchable between devices.
Different OS's just hurts US the consumers.
There's still profit in the PC market otherwise companies wouldn't still be making PC's.
Samsung shouldn't be looking at making their own OS, instead they should be looking at the features they are able to provide us with that differentiate them from the competition (tight integration between their Phones, TV's, etc)
The same way that Sony has its devices set up to easily allow you to push your movies from your phone to your TV when you get back home, your music from your phone to your stereo, etc.
By nniillaa on 3 May 2012
Its still android....
Its android, that's why they are having such problems. Its not a very good system as compared to its rivals and fragmentation is big.They should start focusing on Windows Phone. Its easier to design for, provides enough flexibility and doesnt put the burden of the update on handset manufacturer. There's nothing wrong with being just a hardware manufacturer. It reduces costs and increases focus on products. Instead they should work with developers to have apps that integrate within their ecosystem. Although I personally feel that technology is getting to a point where people just want their gadgets to work with each other without any hassle.
By isaac12345 on 3 May 2012
Chicken and Egg
Samsung design and make their own processors, memory and screens - the vital components of a mobile phone. We could just as easily say is Android too dependant on Samsung.
@isaac12345 you forgot the /sarcasm tag suggesting they concentrate on Windows Phone.
By milliganp on 3 May 2012
Touchwiz masks transition
I always assumed that the Touchwiz overlay was the firm's long-term strategy for switching the OS underneath to Bada. I woud imagine the vast majority of people aren't interested in the OS itself and wouldn't even notice the difference.
If you ever get a chance to play with a Wave 2, you'll notice just how similar it is to using a Galaxy S 2.
By Lemax on 3 May 2012
"In what way does 'Lock-in' deprive consumers of the choice of an [...] ecosystem?"
Ah, you're viewing the world through your iGlasses today (for a change, lol). In your terms; yes, we have a choice of insular ecosystems that are hellbent on destroying every other ecosystem. When I say choice I mean actual real on-a-whim interoperability with any other ecosystem. You know, kinda like your choice of Linux OS not caring which fork's software you put on it. Well... not YOUR choice obviously... you seem determined not to have one.
Oh, and that was some spectacular racism you treated us to. Please stick to fanboism. Ta!
By dubiou on 3 May 2012
So the iThing so called "walled garden" approach is OK for you, leaving no choice for you but to source virtually everything from iWhatsit.
Some freedom from lock-in there, pal!
By jontym123 on 4 May 2012
Well done the_bunker for setting a new record for multiple posts!
By Stiggy on 4 May 2012
Samsung also make some very nice Windows Phone 7 handsets. Take a look at the Samsung Focus S.
By Stiggy on 4 May 2012
Do we need another OS?
Just because it works now for Google, Apple & MS (kind of), doesn't mean Samsung should 'copy' this approach.
Yes I agree they need to ensure they can continue to distinguish themselves & add more value than just nice hardware.
I would like to think that consumers are driving the need for harmony of services across multiple devices & OS; and that the 'lock in' will be just a minor irritation that we put up with, so that the Top execs can still pat each other on the back & congratulate themselves on their 'strategy'...
By the_bunker on 4 May 2012
... your comment is ignorant and racist.
By mcmpro1 on 8 May 2012
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