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LG Electronics CEO resigns after smartphone struggles - Page 2

post #41 of 46
The dilemma facing the likes of Samsung and LG as well as all the other current Android phone makers is the coming wave (more like a tsunami) of super cheap Android phones from a virtual army of Chinese phone companies. I mean, the market (especially in Asia and China in particular) is going to get flooded with these generic commodity Android phones. How does Samsung and LG differentiate their phones from these super cheap Chinese phones that will steadily move upstream? The Chinese consumer electronics companies will use the same strategy and tactics that Samsung and LG used against the likes of Sony, Panasonic, Toshiba, Sharp, etc.

Samsung has to keep moving further upstream and their only chance of maintaining relevance is developing their own OS platform. It's exactly the same reason HP acquired Palm. The only way to differentiate will be vertical integration and offering the entire ecosystem from top to bottom - yes, exactly the business model that Apple has. It has to be about the software platform, the integration, the services, security, the apps, the content, etc. This will be the "mind and soul" of the product. The hardware is "flesh and blood" but without the mind and soul, it's just a piece of plastic and metal.

It's funny how the competition and industry pundits and analysts denigrate Apple for its closed and tightly controlled "walled garden" platform, but that's what everyone would really like to offer if they could. Obviously, the two companies that have the resources to at least give this a try are Samsung and HP. Both are humungous (soon well over $120 billion in annual revenues) and offer a lot of other products that can fit in the ecosystem they design from top to bottom. In the future, these two behemoths will be Apple's biggest competitors in the converging tech and consumer electronics industry - Samsung more on the consumer side and HP in the tech/IT side.

Samsung has stated on their latest annual report of where they intend to be in 2020. Samsung's goal is to reach $400 billion in revenues and become one of the top 5 most admired companies and global brands by that time. The stated goal is nothing less than to become the most dominant tech and consumer electronics company in the world. But, of course, they have one major obstacle standing in their way: Apple. The other obstacles like HP, LG, Sony, Panasonic, Nokia, and Toshiba won't be easy either but none are quite as formidable as Apple. Why? Because Apple owns their own platform and ecosystem. That's the crown jewel that Samsung and HP would love to own as well but it only seems like a pipe dream right now.

As China and India continue to grow and mature, we'll see a mind-boggling flood of cheap devices and services based on the so-called "open" platforms like Android. Even Samsung will have to retreat to the top of the hills to avoid the drowning. There is no way Samsung can fight off this onslaught from China and India. Samsung will have to innovate, add value, offer outstanding customer service, differentiate, and do all these other things that Apple is known for. In essence, they have to become like Apple. But that's the problem. Apple already exists. Samsung has no choice but to take Apple head-on and beat Apple at its own game. They have to define what "Samsung" means in the same way people have a very good idea of what Apple means.

I look at Apple's so-called "walled garden" and closed ecosystem like a planned gated community. It's clean, neat, organized, safe, convenient and is easy to get around in. It may not have everything of downtown city, but at least we are sheltered from the chaos, fragmentation, traffic, crowdedness, confusion, crime, disease, etc. What the Android and Windows crowd doesn't get is that there's a significant chunk of the population that are willing to pay more for that more "exclusive" and closed ecosystem user experience as long as Apple provides everything they need.

The only question is how big can this gated community get? Is it 10%, 20% or even more? What's for certain is that Apple still has long, long ways to go to just get to 10%. And, of course, it will be the top tier of the market. I can easily envision Apple eventually becoming its own ISP and wireless carrier as well as manufacturing virtually all of its goods abroad and perhaps even here in the US. There's that old saying: "If you want to do it right, you've got to do it yourself!"
post #42 of 46
The problem with super cheap Chinese Android phones is that they are super cheap.

There are always customers like me who don't mind paying extra for nice (=usually expensive) materials, fit and finish. And that is what Apple is doing as the ONLY hardware manufacturer throughout their product line. From high quality aluminum keyboard to iPad and iPhone made out of aluminum, stainless steel and glass. Same with their iMacs, notebooks and desktops.

Even if Android (or Windows 7) do more, as long as those systems run on cheap plastic abominations with cluttered buttons and logos, I'll pass....
post #43 of 46
Quote:
Originally Posted by SpamSandwich View Post

Who could have predicted years ago when the iPhone was introduced that Apple would single-handedly gut the entire cellular phone industry? Incredible what has happened and what continues to happen on a daily basis.

Roger that. Thank the Tech gods for the iPhone. It pioneered so much. For this, I will always be loyal to the iPhone.

Just think, we all might still be using 'Razors' (or whatever), version '10', or something.
post #44 of 46
Thank you so much for you 2 great analytic comments, alexkhan2000. I have been reading AI for years, but had to log myself in this time to just thank you. Wish I could upvote your comments like in some other sites.
post #45 of 46
alexkhan2000,

like other fellow forum members, I really enjoyed reading your posts today.

Cheers
post #46 of 46
Quote:
Originally Posted by alexkhan2000 View Post

I look at Apple's so-called "walled garden" and closed ecosystem like a planned gated community. It's clean, neat, organized, safe, convenient and is easy to get around in. It may not have everything of downtown city, but at least we are sheltered from the chaos, fragmentation, traffic, crowdedness, confusion, crime, disease, etc. What the Android and Windows crowd doesn't get is that there's a significant chunk of the population that are willing to pay more for that more "exclusive" and closed ecosystem user experience as long as Apple provides everything they need.

Excellent analysis. Really enjoy your posts also.
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