Company / division: Samsung
Another crazy wrinkle in the ongoing set of regulatory and legal actions against Qualcomm over anticompetitive practices: the Korean regulator responsible for the fine against Qualcomm last year says that one of the conditions of the contract between the companies was that Samsung would not be allowed to sell its own Exynos chips to any other vendors. What’s particularly crazy here is that Samsung is both Qualcomm’s biggest customer for chips and a contract manufacturer of those chips, so the two are inextricably intertwined here but are still going through this painful process. Samsung isn’t suing Qualcomm as Apple is, but it’s still likely cooperating with the authorities who are looking into its dealings in various markets. Just another sign of how far relationships between Qualcomm and some of its biggest customers have got, that they’re willing to start airing their grievances despite their close ties.
This feels like a huge misstep, especially announced the week of the S8 launch, which could otherwise have been the moment Samsung finally put the Note 7 debacle behind it. While the desire to minimize the environmental impact is admirable, and Samsung would no doubt benefit financially from refurbishing the phones, it would have been better off simply doing what it originally said it would and abandoning the line entirely and merely recouping parts. Another story that both keeps the Note7 in the news and raises the prospect of people actually buying them again (even if under a different name) just seems like a terrible tradeoff to make for those benefits. Ironically, this was the week when Samsung also finally issued a software update which will kill the remaining devices still in use in the US, yet another milestone in moving past this whole mess.
via The Verge
Samsung has somewhat unexpectedly taken the wraps off its virtual assistant Bixby ahead of next week’s Galaxy S8 launch, where I’d expected it to be the main event from a feature perspective. Based on how Samsung is describing the feature, though, I think it’s merely trying to defuse some hype by downplaying expectations of what Bixby will and won’t be. (The hype was fueled in part by Samsung’s acquisition of Viv, which was a more traditional virtual assistant that Samsung acquired last year, but Bixby appears to be something less.) The description from Samsung is somewhat vague, but I think the approach actually has a lot of merit: every other assistant promises to be just that, implying a broad-based ability to meet needs, which inevitably leads to disappointment and frustration when it falls short, over-promising and under-delivering. Samsung looks like it will come at this from the opposite end, starting small and building up functionality over time, app by app, in a way that the voice interface is able to handle everything the touch interface does in the same app. That, incidentally, should be good for accessibility, something Android devices have always done less well than iPhones. But the big limit there as with Bixby overall is that if third party developers don’t support it, it won’t be very useful, and it the S8 ships with the Google Assistant users may just choose to use that instead. I’m very curious to see next week exactly how Bixby is invoked and how it compares to the more traditional assistant model. Samsung doesn’t have a great reputation in software and services, and I’m skeptical that it will get this right.
via The Verge
Tim Cook is very fond of talking about Apple’s customer satisfaction ratings on earnings calls – he clearly believes these are both the best indicators of whether Apple is being successful and the best determinants of its future prospects. As such, reviews like this one, which focused on online and phone technical support and service for laptops across the top brands, are good news for Apple, given that it came top of the rankings. It’s also worth noting where others did and didn’t score well – Acer, Lenovo, and Microsoft took the next three spots, while Samsung came near the bottom.
This didn’t get a ton of coverage on Wednesday, but it’s one of the first concrete statements we’ve seen from a major tech manufacturer that it is considering building new infrastructure in the US – all other reporting on this topic has either been unconfirmed by the company or has turned out to be something announced earlier. Samsung is fascinating in this context – unlike Apple and Amazon, it was never singled out for criticism during the campaign, and of course Trump himself uses a Samsung smartphone. But the company nevertheless seems keen to curry favor by building capacity in the US.
Though the CIA leaks from Wikileaks earlier this week are worrisome in their scope and bad news for the vendors whose devices and platforms have been compromised, there’s at least some comfort in the knowledge that these tools have at least theoretically been subject to due process in the past. However, Wikileaks claims that it has the code for the hacking tools themselves and is debating releasing that code, which would make it available to any hacker who wanted to use it, dramatically increasing the potential for misuse for hacking regular individuals. Again, Apple has said (and Google also confirmed this evening finally) that most of the vulnerabilities have already been patched in recent versions of their respective software, so that should be some defense. But as I’ve said already this week, what a vindication of Apple’s refusal to cooperate with the FBI a year ago over hacking an iPhone.
via USA Today
If You Ask To Get Your Samsung Washing Machine Repaired, A Dish TV Guy Might Show Up – BuzzFeed (Mar 8, 2017)
This is a crazy story – Samsung is contracting out washing machine repairs as part of its recall to Dish TV installation technicians, those technicians in turn are trying to sell customers surround-sound systems for their living rooms while often doing a poor job actually repairing the washing machines. This looks like a combination of poor training and poor quality control on the part of both Samsung and the Dish installation contractors (who likely mostly aren’t directly employed by Dish). Imagine you have just been told that your washing machine is potentially dangerous and needs service to fix it, and then the guy who comes to fix it not only doesn’t do that well but tries to push a set of TV speakers on you. This is a terrible experience for the customer, and unfortunately in line with a long prior list of questionable customer service from Samsung over its home appliances.
I suggested this was the case in my coverage of the leak yesterday, but Apple has now issued an official statement to that effect as well. I would guess Apple is still digesting all the information leaked – there’s a lot of it – but it has said that most of the vulnerabilities outlined have already been patched in the latest versions of its software, and fixes for the rest should be coming soon. Samsung has also issued a statement on its TV vulnerabilities, but it’s far less reassuring – it only says it’s aware of and is looking into these hacks. In fairness, though, the Samsung hack appears to require a USB stick plugged into the TV to install it, which means that if you’re a victim you likely have far bigger things to worry about than your TV listening to you – this isn’t a large-scale remote hack that would affect the population as a whole.
via USA Today
Wearables grew 16.9% in Q4 2016, Fitbit still first but Xiaomi is gaining – VentureBeat (Mar 2, 2017)
The numbers here look about right, but what a far cry from the forecasts of the wearables market we saw a few years back. I recently wrote a piece on the state of the wearables market, in which I argued there are really three important sub-markets within wearables: the Apple Watch in its own category, dedicated fitness trackers (in which Fitbit dominates in western markets and Xiaomi in China), and Samsung’s various devices, many of which are bundled with smartphone purchases and therefore thrive on a rather different business models from the others. These IDC numbers largely back that up with market share numbers, but also reinforce the point I made in that article about how the market has fallen short of its theoretical potential and largely stopped growing. It can still grow, but the offerings need to get much better and broader in their appeal, and to some extent we also need the technology – especially in components – to catch up with the vision here.
The number in the headline refers to the acquisition price of Viv, a virtual assistant startup which Samsung bought a few months back and is expected to integrate into the Samsung S8 launching later this month. To put that number in context, it’s around the same amount Apple was reported to have paid to acquire Siri, and tiny in the context of Samsung’s overall business – it generated $180 billion in revenue last year, along with $25 billion in operating profit. So Samsung can far more easily afford this investment than, say, Xiaomi can afford its comparably-sized investment in in-house chip capability. But it’s still a decent chunk of money from Samsung in a year when it also announced the much larger Harman acquisition. Far more importantly, we haven’t yet seen what Viv will do when integrated into a Samsung phone, and whether it’ll be as good as the early hype around the standalone product suggested.
5G Schedule Moves Up to 2019 – PCMag (Feb 27, 2017)
As I expected, 5G seems to have been a big theme at MWC this year, with lots more marketing type announcements but also some actual products being announced, albeit ones which should technically be described as pre-5G. The headline here is a bit funny, because of course it’s in these companies’ interests to suggest 5G is more imminent than previously thought, but it’s not up to them how quickly the technology gets deployed – that’s entirely up to the carriers, and I’m still very skeptical that we’ll see 5G available to more than a handful of locations before 2020 in the US (or probably anywhere else). And of course the idea that Qualcomm’s 5G modem would premiere in an iPhone seems laughable – Apple has been deliberately slow to adopt both previous wireless generations (3G and 4G), because the early trade-offs between performance and battery life make early entry unappealing. I don’t see that changing with 5G. But as a previous piece suggested, 2017 is going to be the year of pre-5G commercial trials, which is an important step along the path to eventual mainstream rollout and adoption.
Samsung is doing its flagship smartphone reveal a month from now in New York, so it’s focused on other things at MWC. I already covered its VR headset update, but another announcement involved a couple of new Windows tablets. As is so often the case with these trade show announcements, specific prices haven’t been announced, but these are on the ultraportable side of the PC range, looking a lot like some of Samsung’s Android tablets but with Windows onboard instead, and with detachable keyboards. This definitely feels like the hottest segment of the PC/tablet market at the moment, with Microsoft’s own Surface, lots of alternatives from OEMs, and of course Apple’s iPad Pro coming at this from a different angle.
Samsung’s Gear VR headset has been by far the top-selling VR device so far, with over 5 million units “sold” (although many were likely given away or bundled at a very low price with smartphones) versus under a million so far for Playstation VR. Mobile VR is the mass market segment, and it’s always going to beat the hardcore VR rigs on volume, but the performance is often sub-par, and the user interface on the Gear VR has been pretty abysmal. The Daydream VR headset Google debuted late last year was much better in this regard, with a nice little hand-held controller which was mostly much easier to use, though it can be a little glitchy at times. It looks like Samsung now has a much more usable controller too, which should be a big help in making its VR experiences more enjoyable. The new controller ships with a new version of the Gear VR headset, and may or may not be available as an accessory for existing owners (price and date are also still unavailable).
As usual, it would be great to understand in more detail the methodology behind this survey, but it’s not available. The Verge seems to have got the rankings wrong – from what I can tell, Samsung was 7th and not 3rd last year – but it’s also worth noting that Samsung’s score dropped from 80.44 to 75.17, which sounds a lot less dramatic than dropping from 3rd (or even 7th) to 49th. The fact is that there are a lot of companies clustered together between 75 and 87 points and so a small drop in the score produces a big drop in rankings. Since the survey was also conducted in November and December last year, when the Note7 debacle was still very fresh in people’s minds, I’m guessing it would score a lot better just a few months from now. Though the Verge picked up on Samsung’s drop as their headline, it’s worth noting where other tech companies sit too: Amazon is #1 (score 86.27), Apple #5 (82.07), Google #8 (82.00), Tesla #9 (81.70), Netflix #18 (79.86), and Microsoft #20 (79.29), all of which classify as either very good or excellent. It’s also worth noting that big cable companies like Comcast and Charter score in the low 60s, which qualifies as “poor”, while the major wireless carriers score 66-72 (“fair” to “good”), with T-Mobile top and Sprint bottom.
Samsung to Use Sony Batteries in Galaxy S8 Phone – WSJ (Feb 17, 2017)
The fallout from the Note7 recall continues: Samsung is apparently adding another battery supplier to its roster, though Sony’s capacity is so small that it will likely be by far the smallest by volume. None of this guarantees anything – the Note7 had problems because both battery suppliers produced faulty batteries and because Samsung’s design put pressure on those batteries. Given that those same two suppliers will be making most of the batteries used for the S8, and Samsung of course will still be designing it, what those three companies do differently is far more important than adding another minority battery supplier. As such, I suspect this is probably better read as an attempt by Samsung to exert some pressure on its existing suppliers by demonstrating a willingness to look elsewhere than any sort of strategy to ensure safer batteries in the S8. In that way, this is analogous to Apple’s recent move to give Intel some of its iPhone modem business. But all this also highlights the difficulties in shifting suppliers at such scale – neither Apple nor Samsung can suddenly switch suppliers at this volume, and even if they could the new vendors often underperform relative to the incumbents (as here with Sony’s batteries and also with Intel’s modems).
Every quarter, there’s a slew of headlines on this basis, usually based on analysis from Cannacord Genuity. The big flaw in this analysis (and the reason I inserted a “not really” into the headline) is that it only looks at those players that publicly report profits from a smartphone unit, plus Apple. As the article points out, the “survey” of six “major” smartphone vendors includes the #1 and #2 but also BlackBerry and Microsoft, which each shipped well under a million smartphones last quarter. It entirely leaves out the third, fourth, and fifth largest smartphone vendors (Huawei, Oppo, and Vivo) and other big names from the top 10 like Lenovo and Xiaomi. Lenovo is publicly traded, but hasn’t reported yet (and is likely to have been unprofitable in smartphones again), but no-one really knows how profitable the others are. So the headline is misleading when it talks about “industry profits” – it’s a very narrow analysis of six vendors, only two of which are in the top 10. Now, that’s not to say that it isn’t likely that Apple captured the vast majority of profits in the smartphone market yet again – it almost certainly did, and this situation highlights both the general challenges with driving meaningful profits from consumer electronics and the specific challenges associated with competing on the basis of Android in smartphones. But this – as with the flawed quarterly market share rankings with their false precision – grates every quarter because it’s shoddy analysis.
Another big tech company starts looking into US manufacturing in the wake of Donald Trump’s election as president. There’s no official statement yet, and Samsung hasn’t been the target of direct attacks from Trump in the same way Apple has, but it’s apparently feeling the heat regardless. It’s interesting to see even non-US tech companies start to respond to Trump’s calls for more US manufacturing – we’ve seen this already in the car industry, but now we’re seeing it with LG and Samsung too. This is a sign of just how unpredictable US government policy has become over the last few weeks compared with the relative stability of prior years.
via Business Insider
I cited some Counterpoint data on India the other day, and in that context said that they do a good job with these non-Western markets – these numbers are solid, although it’s interesting to see these results for China come out before Apple and several other companies have reported their results for the fourth quarter. Unlike India, China is a major contributor to Apple’s overall results, and there’s usually lots of commentary about the rate of growth there, so it’ll be interesting to compere these numbers with what Apple releases next week. In the meantime, there’s lot of interesting stuff here – over the full year, Xiaomi and Apple fared poorly out of the major vendors, though Apple’s Q4 sales held up a lot better than in Q1-Q3. Lenovo’s year in China was a disaster, and it will be very grateful once again that it has Motorola in the rest of the world to buoy things up a bit. The big story is Oppo and Vivo, which have broken into the top rankings globally off the back of a strong showing in China, but Huawei also did very well. It’s also interesting to look at the data in here on individual models, where the two iPhone 6s variants both score in the top 10, and two Oppo phones are in the top 5, including the number 1 slot. The whole post is well worth a read if you’re interested in the Chinese market.
Evan Blass, who used to publish leaks anonymously under the pseudonym Evleaks and has a great track record of accurate reporting, claims these are pictures of the forthcoming Samsung Galaxy S8. The main changes are a full screen front, with the fingerprint sensor moved to the back, while charging switches from micro USB to USB-C, and Samsung retains the headphone jack. The smaller bezel approach has been widely rumored for the next iPhone this fall, and I think what we’re seeing here to some extent is the same rush into smartwatches in the year or two before the Apple Watch emerged, driven by rumors of where Apple was going. In the smartwatch category, we saw a variety of failed attempts to create something compelling only for the Apple Watch to dominate the market when it launched, and you always have to wonder with this pre-emptive following whether competitors will really be able to crack the concept in a way that’s as compelling as whatever Apple releases. Xiaomi already has an essentially bezel-less phone, LG is reported to be moving in that direction, and now Samsung supposedly is too. It’ll be very interesting to see how this space looks at the end of the year once all these phones (including a new iPhone) are on the market.
This is another one of those occasions where Android’s relatively open and complex structure allows for malware which couldn’t exist on iOS. In this particular case, it’s the layering of third party software (a customized version of the SwiftKey keyboard) on top of a customization of the UI and services (by Samsung) on top of the Android base layer. To be fair, this attack isn’t nearly as broad a threat as malware distributed through the Google Play Store – it requires a man in the middle attack and is therefore mostly a risk to those who might be deliberately targeted by hackers – but it’s still not good news, especially given the wide distribution of the devices in question. The complex route security patches have to take in the Android world is another element that will hamper the resolution of this issue.
via Ars Technica