Samsung recently unveiled the upcoming Galaxy A7 phablet, a larger phone with a competitive price point. This phone came months after the South Korean tech giant launched two smaller smartphones, the A5 and A3.
A look at the Samsung Galaxy A7
The new Android phone features a 5.5-inch high-definition AMOLED display, two separate quad-core processors, a 5-megapixel front facing camera, a 13-megapixel rear facing camera, and a 2,600 mAh battery. Amazingly, the phone manages to retain the thickness of 6.3 millimeters. It remains thinner than the A5 and A3. This model also runs on Android 4.4 and offers LTE connectivity.
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As of this writing, Samsung declined to comment on the availability or price of the phone. The two previous models were initially targeted at the Chinese market, but the South Korean handset maker faced serious competition from the likes of Xiaomi and Lenovo. In 2014, Samsung even lost its top position as the largest smartphone vendor in China, all thanks to the influx of cheaper phones.
A serious decline in sales
Samsung lost market share on a global scale during last year’s third quarter. It went from 32% to 24%. Overall shipments dropped from 80 million in the third quarter of 2013 to 73 million in the third quarter of 2014.
Xiaomi really made a name for itself as a company by launching Apple-like products for a fraction of the cost. Subsequently, the company has sold millions of phones. It all started in 2011 when the company launched its first flagship phone, the Mi 1. This phone brought cutting edge technology to budget-friendly shoppers. The Mi 1 retailed for just 1,999 yuan (USD$324), a fraction of the cost of the iPhone 4, which retailed for 4,999 yuan.
Samsung’s strategy to sell budget-friendly phones may not be the best move for the company. IBK Securities analyst Lee-Seung explained, “Samsung made profit from the high-end smartphones, their mid to low segment lines may be popular in China and India, but when it comes adding to its margin and profit, it’s a different story. As smartphone market is saturating, whether [Samsung] turns its focus to TV or IoT market, it will get pressured from the Chinese companies.”
It may be time for the tech giant to consider a new strategy.