Samsung Mobile Phone Sample Essay
This essay analyses the Samsung Mobile company by using Porter’s Five forces. Besides each factor will be compared with Apple and Nokia which are competitory companies in the nomadic industry and the strength of Samsung’s strategic place will be demonstrated.
Samsung Electronics. Apple and Nokia are the competitory Mobile companies. To compare each company’s strategic place Samsung was chosen. Although many constituents are needed to do nomadic phones ; semiconducting materials and the operating systems ( OS ) which companies use will be chiefly discussed because these factors have an consequence on the map of a nomadic phone. Therefore this essay analyses Samsung’s strategic place in comparing with Apple and Nokia’s.
The menace of new entry.
The nomadic phone industry needs high capital demands to bring forth a big volume of merchandises ( Husso. 2011 ) . Harmonizing to Porter ( 1996 ) . the more capital that is required. the higher the entry degree which means it is hard to come in and last the market without big capital. Samsung. Apple and Nokia have besides existed for a long clip in the industry and have strong distribution channels ( Huvard et al. 2006 ) . Even if a new company enters the market. it is expected that they would be affected by officeholders and happen it hard to last. Because of this. the menace of new entry will be low and expected revenge will be high.
Rivalry among bing rivals.
Competition in the nomadic industry is high. ( Parnell. 2009 ) . As can be seen from Table 1. Samsung’s gross revenues Numberss are at the top above the other companies. It is suggested that Samsung’s smartphones have attractive hardware design. improved characteristics and strong support systems so these factors make them a market leader ( Awal. 2012 ) . Samsung Semiconductor is a subordinate company of Samsung Electronics which provides semiconducting materials to Samsung Electronics used in nomadic and cardinal engineering ( Shaw. 2011 ) . They hence have a strong part web. Apple and Nokia unlike Samsung do non hold this subordinate company therefore leting Samsung to hold an advantage as it gives them a better net income per unit of sale. Table1. The gross revenues figure of cell phone 2012.
Company| Percentage of gross revenues 2012 ( % ) |
Samsung| 31. 3|
RIM| 4. 3|
ZTE| 4. 2|
Others ( Nokia included ) | ( Beginning: adopted from Mello. 2012 )
The power of providers
Samsung. Apple. and Nokia use a assortment of providers for nomadic constituents ( Husso. 2011 ) . As some nomadic constituents of Samsung Electronics are provided by their subordinate company. it seems that they have low power of provider. Besides. the subordinate company which is Samsung Semiconductor was ranked 2nd in the figure of gross revenues throughout the universe in 2012 ( Leachman et al. 2002 ) . This means that their semiconducting materials could be delivered for a low monetary value in high quality. The most interesting factor is that Apple and Nokia chose the Samsung Semiconductor for their provider ( Leachman et al. 2002 ) . Therefore Samsung Semiconductor could cut down the fixed cost as they produce big sums of semiconducting materials to supply to two big companies. In the instance of Operating System. except for Samsung. Apple and Nokia use their ain company’s OS which is iOS and Symbian severally. In the OS market. Android histories for over 50 % market portion which means they provide OS to many nomadic companies ( Fernandez. 2009 ) . Therefore Samsung which uses Android OS has high degree of power of Operating System providers than Apple and Nokia comparatively.
Table 2. The Market portion of Operating system in 3Q 2011
Operating System ( OS ) | 3Q 2011 Market Share ( % ) |
Android| 52. 5|
Symbian| 16. 9|
iOS| 15. 0|
The other| 15. 6|
( Beginning: adopted from hypertext transfer protocol: //www. gartner. com/it/page. jsp? id=1848514 )
The power of purchasers.
As there are many smartphones and they have similar map each other. clients can take and alter the smartphone depending on the monetary value. design or operation system easy. Therefore exchanging cost could be low and power of purchasers is high ( Porter. 2008 ) . However Samsung have chosen different scheme with Apple. The Strategy Samsung chose is to bring forth a assortment of smartphone which have somewhat different designs and maps each other to run into customers’ different demands ( Awal. 2012 ) . In instance of Apple. even if they have produced smartphone foremost. hold 20 times less the figure of smartphone than Samsung ( Mello Jr. 2012 ) . Therefore Samsung could cut down the power of purchasers by bring forthing many sorts of smartphones than the others companies.
The dainty of replacement.
As engineering is developed and the tendency of consumer’s demands alterations. companies produce merchandises with similar map but different agencies ( Porter. 2008 ) . In the nomadic industry. tablet and laptop could be considered as the replacement merchandises. However in instance of laptop. it is non uncomfortable to transport in mundane life so most of people prefer tablet to utilize alternatively of smartphone. Samsung. Apple and Nokia produce tablet every bit good and Samsung and Apple have high gross revenues figure in the tablet industry. Unlike the gross revenues figure of smartphone in Table 1. Apple has the highest figure of gross revenues figure among them in Table 3. Therefore it is suggested that Samsung needs to analyse the competitory merchandise and put to Research and Development to be successful in the tablet market every bit good. Even if the power of replacement is low within the nomadic industry because companies which sell smart phone besides produce the tablets. competitory of replacement with each nomadic company is high. Table 3. Global Tablet prognosis in 2012.
Tablet| The figure of gross revenues ( million ) |
Apple ( iPad ) | 65|
Samsung ( Galaxy check ) | 12|
Nokia ( N810 ) | 4|
( Beginning: adopted from
In the intense nomadic industry. Samsung has maintained the high rank among the competitory competition. Due to high capital demands. the menace of entry was low. Although the power of clients within the nomadic industry is high. Samsung could cut down that by bring forthing many sorts of smartphone. Samsung can acquire advantage as their subordinate company supplies semiconducting material to them. However in the Operating System market. it seems that they have comparatively high degree of power of supplier than the two companies. In instance of replacement. it is suggested that they need to put in the Research and Development to tablet to be progressed.
1. Fjeldstad. O. D. . Becerra. M. & A ; Narayanan. S. ( 2004 ) . Strategic action in web industries: an empirical analysis of the European Mobile phone industry. Norse Journal of Management. 20/1. pp. 173-196. 2. Porter. M. E. ( 2008 ) . The Five Competitive Forces That Shape Strategy. Harvard Business Review. pp. 79-93. 3. Leachman. R. C. . Kang. J. & A ; Lin. V. ( 2002 ) . SLIM: Short Cycle Time and Low Inventory in Manufacturing at Samsung Electronics. Interfaces. 32/1. pp. 61-77. 4. Poter. M. E. ( 1996 ) . What is scheme? . Harvard Business Review. 74/6. pp. 61-78. 5. Nalebuff. B. J. . & A ; Brandenburger. A. M. ( 1997 ) . Co-opetition: Competitive and concerted concern schemes for the digital economic system. Strategy & A ; Leadership. 25/6. pp. 28-35. 6. Mello. J. P ( 2012. October ) . Samsung. Apple phones lead gross revenues while Nokia sags. Macworld. Retrieved from hypertext transfer protocol: //www. macworld. com. au/news/samsung-apple-phones-lead-sales-while-nokia-droops-77847/ 7. Huvard. S. . Salcedo. R. . Tuppince. L. . Wentz. M. . & A ; Zolad. L. ( 2006 ) . Vodafone Air Touch: The Acquisition of Maanesmann: Virginia Commonwealth University. pp. 1-29 8. Husso. M. ( 2011 ) . Analysis of Competition in the Mobile Phone Markets of the United States and Europe.