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The Two-Horse Smartphone Race

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The different strategies of Apple and Samsung in getting to the point where the two companies now dominate the smartphone market. Whereas Apple makes only one phone, its iPhone, Samsung's strategy is to have multiple phones in each price segment. It has five levels of Android based phones, with 2-3 models in each price segment. Samsung also benefits from doing its own maufacturing. When faced with a number of technologies Samsung's strategy is to bet on all of the technologies until one of them emerges as a winner, and then concentrate resources on that technology. It uses a similiar strategy for televisions. Apple by contrast places more emphasis on original design and profit margins over sales, gaining sales without eroding margins by being the first innovator in the market. It also has its own unique arrangement for manufacturing at lowcost with Foxconn in China that supports its high margins. Apple is secretive about its designs and promotes its brand heavily with its own retail stores. Apple also uses its innovative edge as leverage to steer profits away from carriers. Analyst estimates are that carriers such as AT&T and Verizon pay about $400 per iPhone to subsidize its cost because this is the only way to get customers into their retail stores. IDC estimates are that the smartphone market is $219 billon in 2012. Both companies are very close in volume- IDC estimates Apple shipped 93.2 million smartphones in 2011, compared to Samsung's 94 million units. Apple has market share of 23.5% in the fourth quarter 2012, up from 16% in 2010. Samsung has 22.8%, up from 9.4% in 2010. Apple and Samsung have together taken 91% of operating profits of all cellphone companies in the fourth quarter, an increase of 30% from 2011, according to Strategy Analytics.

China's mobile phone market.

06/16/2010

China's mobile phone market includes Nokia, Samsung, and also local Chinese companies like Tianyu which satisfy demand for lower prices and locally desired features. It can price the K-Touch touchscreen, at athird of the price of a similiar Taiwanese phone.

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Apple Faces Dilemma Over Strategy in China

Wall Street Journal 04/24/2013

Huawei Set to Launch New Smartphone

Wall Street Journal 06/18/2013

A Glum Sign for Apple in China, as Smuggled iPhones Go Begging

New York Times 09/28/2014

Xiaomi Makes a Profit on Its Cheap Smartphones

Wall Street Journal 11/06/2014

Tianyu Leads Rise of China's Handset Makers

Wall Street Journal 06/16/2010

China's 3G Users Reach 25.2 Million

Wall Street Journal 07/20/2010

Japanese chipmaker Elpida and competition with Hynix and Samsung

10/24/2010

Decline in demand for chips, the high cost of new plants, and the rise in the value of the yen are hurting Elpida.

Grouped Articles

Japanese Firms Send Work Overseas

Wall Street Journal 10/24/2010

Japan Turns Tables on Korea Inc.

Wall Street Journal 12/12/2014

Micron to Acquire Japanese Rival Elpida

Wall Street Journal 07/02/2012

Fading Memory Saps Chip Makers

Wall Street Journal 01/07/2012

Elpida Files for Bankruptcy Protection

Wall Street Journal 02/28/2012

Japan Lets Chips Fall Where They May

Wall Street Journal 02/27/2012

Samsung

01/03/2006

Grouped Articles

Behind Sony-Samsung Rivalry, An Unlikely Alliance Develops

Wall Street Journal 01/03/2006

Sony, Samsung Bet Big On LCD-TV Demand

Wall Street Journal 04/11/2006

Rivals Samsung, LG Find Digital Detente

Wall Street Journal 05/22/2008

Samsung Overhaul Will Form Two Divisions

Wall Street Journal 01/16/2009

Memory Chips Signal Sector Getting Set For Recovery

Wall Street Journal 04/27/2009

South Korea Clears Way for iPhone Sales

Wall Street Journal 09/24/2009

Samsung in China

12/03/2010

Grouped Articles

Apple Faces Dilemma Over Strategy in China

Wall Street Journal 04/24/2013

Huawei Set to Launch New Smartphone

Wall Street Journal 06/18/2013

Lenovo-Google Deal Adds to Samsung's Smartphone Worries

Wall Street Journal 01/30/2014

A Glum Sign for Apple in China, as Smuggled iPhones Go Begging

New York Times 09/28/2014

Samsung Electronics Third-Quarter Profit Plunges

Wall Street Journal 10/07/2014

Samsung Electronics Third-Quarter Profit Falls Sharply

Wall Street Journal 10/30/2014

Samsung mobile software

04/22/2010

Grouped Articles

Samsung Presses Ahead on Android

Wall Street Journal 09/02/2011

Innovator: Fred Brooks

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Samsung Pursues Developers, Seeking Orbit of Apps

Wall Street Journal 10/28/2013

Samsung: Uneasy in the Lead

New York Times 12/14/2013

Samsung Looks to Software and Services

Wall Street Journal 02/19/2014

Samsung Moves to Boost Software

Wall Street Journal 09/21/2011

Samsung smartphones

01/07/2011

Grouped Articles

Samsung Plans 'Rugged' Version of Galaxy S 4 Phone

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Samsung Shines as Rivals Fade

Wall Street Journal 04/26/2013

Apple's Smartphone Market Share Falls

Wall Street Journal 04/28/2013

Samsung's Dream Is to Be No Android Sheep

Wall Street Journal 06/17/2013

Huawei Set to Launch New Smartphone

Wall Street Journal 06/18/2013

Samsung's Profit Soars on Solid Smartphone Sales

Wall Street Journal 07/26/2013

Samsung's chip business

04/02/2012

Grouped Articles

Samsung Hires Hint at New Chip Focus

Wall Street Journal 04/02/2012

The Two-Horse Smartphone Race

Wall Street Journal 04/24/2012

Samsung 5 Lessons: The Record Edition

Wall Street Journal 04/27/2012

Samsung Rides Smartphone Sales

Wall Street Journal 04/27/2012

Samsung Shares Tumble

Wall Street Journal 06/25/2012

Samsung's mobile business.

06/28/2010

Grouped Articles

Apple Faces Dilemma Over Strategy in China

Wall Street Journal 04/24/2013

Samsung Could Soon Surpass Apple in Handset Profit

New York Times 05/06/2013

Samsung Pursues Developers, Seeking Orbit of Apps

Wall Street Journal 10/28/2013

Investors Stay Sour on Samsung, Slicing $8 Billion From Market Capitalization

Wall Street Journal 01/02/2014

Smartphones Throw Samsung a Curve

Wall Street Journal 01/08/2014

Samsung: Fluffed lines

Economist 01/14/2014

The impact of the Google deal for Motorola Mobility on Samsung, HTC Corp. and other Asian smartphone companies

01/15/2009

Grouped Articles

With Moto X, Google Enters a Crowded Marketplace

New York Times 08/01/2013

HTC Develops China-Focused Mobile Operating System

Wall Street Journal 08/28/2013

Turmoil Roils HTC as Phone Sales Shrivel

Wall Street Journal 11/06/2013

Google's Drop in the Smartphone Ocean

Wall Street Journal 11/17/2013

After Big Bet, Google to Sell Motorola Unit

New York Times 01/29/2014

Google Sells Handset Business to Lenovo

Wall Street Journal 01/30/2014

Sony Ericsson peformance

01/07/2011

Grouped Articles

Ericsson to Cut Jobs as It Transitions Into a Software Firm

Wall Street Journal 03/13/2015

Sony Ericsson's Strategy: Get Smart

Wall Street Journal 10/03/2011

Sony Nears Deal to Buy Out Ericsson From Joint Venture

Wall Street Journal 10/06/2011

Sony's Brave Call on Handsets

Wall Street Journal 10/07/2011

What Is Sony Now?

BusinessWeek 11/17/2011

Moody's Downgrades Sony, Panasonic

Wall Street Journal 01/23/2012

Sony Mobile management

02/27/2012

Grouped Articles

Sony Turnaround Effort Falters, Expects $2.15 Billion Yearly Loss

Wall Street Journal 09/18/2014

Sony Turnaround Effort Falters, Expects $2.15 Billion Yearly Loss

Wall Street Journal 09/18/2014

Sony Shares Plunge After Earnings Warning

Wall Street Journal 09/18/2014

Sony Increases Loss Forecast to $2.14 Billion, as Mobile Growth Slows

New York Times 09/17/2014

Sony Posts Hefty Loss, but With Glimmers of Hope

Wall Street Journal 11/01/2014

Sony Vows to Overhaul Smartphone Unit

Wall Street Journal 11/26/2014

Sony Mobile performance

08/27/2010

Grouped Articles

Weaker Yen Puts Japanese Profits on a New Track

Wall Street Journal 05/07/2013

Sony Posts a Small Profit, Its First in 5 Years

New York Times 05/09/2013

Japan's Electronics Under Siege

Wall Street Journal 05/15/2013

Sony's Loss Is Black Eye for CEO

Wall Street Journal 10/31/2013

Sony Struggles to Stay In the Game

Wall Street Journal 11/01/2013

Sony Points to U.S. Softness

Wall Street Journal 08/27/2010

Sony financial performance 2010-2015

07/08/2010

Grouped Articles

Weaker Yen Puts Japanese Profits on a New Track

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Sony Posts a Small Profit, Its First in 5 Years

New York Times 05/09/2013

American Investor Targets Sony for a Breakup

New York Times 05/14/2013

Japan's Electronics Under Siege

Wall Street Journal 05/15/2013

Sony’s Bread and Butter? It’s Not Electronics

New York Times 05/27/2013

Sony's Loss Is Black Eye for CEO

Wall Street Journal 10/31/2013

Sony under CEO Kazuo Hirai

02/01/2012

The Playstation unit chief assumes the CEO position in January 2012. He emphasizes user experience and bringing Sony's diverse products under the direction of the UX group. Hirai makes some of the tough decisions facing Sony such as cutting its size in the television business.

Grouped Articles

Sony Posts a Small Profit, Its First in 5 Years

New York Times 05/09/2013

Sony Slashes Forecast to $1.1 Billion Annual Loss

Wall Street Journal 02/07/2014

Sony Signs Video Game Deal with Shanghai Oriental Pearl

Wall Street Journal 05/27/2014

Sony Turnaround Effort Falters, Expects $2.15 Billion Yearly Loss

Wall Street Journal 09/18/2014

Sony Head Thanks Supporters in Hacking Attack

Wall Street Journal 01/06/2015

Sony CEO Remains Committed to Consumer Electronics

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Sony's strategies in the smartphone business

01/07/2011

Efforts by Sony to bring the smartphone operations of Sony-Ericsson in house in 2011, by buying out Ericsson. The smartphone as a device which links up with Sony's games, playstation, music and other media capabilities. The inhouse operations would enable faster turnout of new smartphone models, and enable the use of proprietary technologies and products.

Grouped Articles

Sony Struggles to Stay In the Game

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PlayStation 4 Debuts With Big Crowds, Short Supplies

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After Losses, Yet Another Overhaul for Sony

New York Times 02/06/2014

Sony Unveils Plans to Revive Company

New York Times 04/12/2012

Sony Tries to Crack Smartphone Market With Xperia Z2

Wall Street Journal 02/24/2014

For Sony, Struggle is Still the Bottom Line

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SONY's LED television display technology

04/22/2010

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How Vizio Beat Sony in High-Def TV

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Samsung Threatens Sony's Progress

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New Sony CEO to Cut 10,000 Jobs

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Sony’s TV Business Mends, but Will It Be Enough?

Wall Street Journal 12/14/2014

Sony CEO Remains Committed to Consumer Electronics

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Sony Taps New Type of Screen for TV Sets

Wall Street Journal 01/10/2012

Apple and distribution of the iPhone in China through China Mobile

07/08/2010

Grouped Articles

Apple Faces Dilemma Over Strategy in China

Wall Street Journal 04/24/2013

Apple's Smartphone Market Share Falls

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China Mobile Exercises Sway in 4G Standards

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Digits | WSJ.com/digits

Wall Street Journal 09/11/2013

Apple Won't Go for Broke in China

Wall Street Journal 09/12/2013

Even With a Big Store in China, Apple Remains an Underdog There

New York Times 07/08/2010

Apple in 2011-2012

04/14/1998

Grouped Articles

Are Apple's Best Years Over?

Wall Street Journal 01/15/2011

Apple Holders: Give Us Our Cash!

Wall Street Journal 01/18/2011

Timothy Cook in Apple Spotlight as Jobs Takes Leave

New York Times 01/17/2011

Apple Needs a Stronger Transfer of Power

New York Times 01/17/2011

Apple, With or Without Steve Jobs

BusinessWeek 01/19/2011

Apple’s Data Practices Draw More Scrutiny

New York Times 04/21/2011

Apple strategies

04/14/1998

Grouped Articles

After Apple’s Rise, a Bruising Fall

New York Times 04/18/2013

Apple Snaps Growth Streak

Wall Street Journal 04/24/2013

Apple in Danger of Losing Its Cool

Wall Street Journal 04/23/2013

Apple Faces Dilemma Over Strategy in China

Wall Street Journal 04/24/2013

Apple's Gilded Approach to Value

Wall Street Journal 09/10/2013

Apple's 'Low End' Strategy Disappoints

Wall Street Journal 09/11/2013

Apple's pricing strategy for iPads and iPhones

02/14/2011

Apple's pricing strategy for the iPad at $499 helps it maintain a grip on this rapidly growing market, making it difficult for competitors. Either competitors such as Amazon price lower to gain market share and have low margins or barely profitable product as with the Kindle at $199, or price relatively higher and gain only modest market share.

Grouped Articles

Apple Faces Dilemma Over Strategy in China

Wall Street Journal 04/24/2013

Apple's Gilded Approach to Value

Wall Street Journal 09/10/2013

Apple's 'Low End' Strategy Disappoints

Wall Street Journal 09/11/2013

Apple's Dual iPhone Strategy in Doubt

Wall Street Journal 10/17/2013

With New Apple iPads, Tablets Move Closer to Passing PCs in Sales

New York Times 10/22/2013

Google Squeezes Margins on Moto G Phone

Wall Street Journal 12/07/2013

Apple's share price and financial performance

03/06/2012

Grouped Articles

After Apple’s Rise, a Bruising Fall

New York Times 04/18/2013

Apple Has an Identity Crisis

Wall Street Journal 04/23/2013

Apple Snaps Growth Streak

Wall Street Journal 04/24/2013

Apple in Danger of Losing Its Cool

Wall Street Journal 04/23/2013

Apple's Smartphone Market Share Falls

Wall Street Journal 04/28/2013

Apple's 'Low End' Strategy Disappoints

Wall Street Journal 09/11/2013

Nokia and Motorola approach to markets

01/24/2008

How Motorola slipped and Nokia picked up after losing market share and set strong direction in emerging markets.

Grouped Articles

Without a Hit Razr Sequel, Profit Drops for Motorola

New York Times 01/24/2008

Nokia Earnings Jump on Emerging Markets

Wall Street Journal 01/25/2008

Moto Must Weigh Greater Scale

Wall Street Journal 04/08/2011

Missteps Slow Motorola

Wall Street Journal 07/28/2011

Nokia Sees Silver Lining in Google Deal

Wall Street Journal 08/15/2011

Google's Big Bet on the Mobile Future

New York Times 08/16/2011

Nokia failing competitiveness and the Stephen Elop memo

01/24/2008

The "Burning Platform" memo by Nokia CEO Stephen Elop, tells Nokia employees that Nokia in 2011 is like a man in the North Sea who hears an explosion on his oil platform and sees it burning. He has to choose between standing there or to jump into the icy waters, and he chooses to jump and makes it against all odds.

Grouped Articles

Nokia's Turnaround Has Long Way to Go

Wall Street Journal 07/19/2013

Microsoft in $7 Billion Deal for Nokia Cellphone Business

Wall Street Journal 09/03/2013

Microsoft Gets Nokia Units, and Leader

New York Times 09/03/2013

Nokia's Stephen Elop: Next Microsoft CEO?

Wall Street Journal 09/04/2013

From Nokia, an Executive Who Knows the Difficulties at Hand

New York Times 09/03/2013

Nokia’s New Chief Faces a Culture of Complacency

New York Times 09/26/2010

Nokia India

10/03/2011

Grouped Articles

Nokia Calls on Indian Court to Unfreeze Assets

Wall Street Journal 11/22/2013

Apple Cedes Surging India Smartphone Market to Nokia-RIM: Tech

BusinessWeek 10/03/2011

Nokia Has a Short Window of Opportunity in Smartphones

Wall Street Journal 04/12/2012

Nokia Crisis Deepens, Shares Plunge

Wall Street Journal 04/12/2012

Nokia Lowers Estimate for First-Quarter Profit

New York Times 04/11/2012

Nokia Posts $1.2 Billion Loss as Sales Drop 29%

New York Times 04/19/2012

Nokia smartphones with the launch of the Lumia line using Microsoft software

01/20/2011

Grouped Articles

Nokia's Turnaround Has Long Way to Go

Wall Street Journal 07/19/2013

Microsoft in $7 Billion Deal for Nokia Cellphone Business

Wall Street Journal 09/03/2013

Nokia Could Boost Microsoft’s Push to be Mobile No. 3

Wall Street Journal 09/03/2013

Microsoft Gets Nokia Units, and Leader

New York Times 09/03/2013

Nokia's Stephen Elop: Next Microsoft CEO?

Wall Street Journal 09/04/2013

Nokia Sells Record Number of Lumia Smartphones

Wall Street Journal 10/30/2013

Nokia U.S.

12/09/2011

Grouped Articles

Nokia's Turnaround Has Long Way to Go

Wall Street Journal 07/19/2013

Nokia's Stephen Elop: Next Microsoft CEO?

Wall Street Journal 09/04/2013

Nokia Sells Record Number of Lumia Smartphones

Wall Street Journal 10/30/2013

Nokia Preps Return to U.S.

Wall Street Journal 12/09/2011

Nokia Re-Enters U.S. With $50 Smartphone

Wall Street Journal 12/15/2011

Nokia's Chief Takes Aim at U.S. Market

Wall Street Journal 01/10/2012

Nokia.

10/16/2009

Grouped Articles

Nokia Posts $1.36 Billion Loss as Sales Fall 20%

New York Times 10/16/2009

Nokia Sags on Venture, but Outlook Picks Up

Wall Street Journal 10/16/2009

Nokia, Sony Ericsson See Hope on High End

Wall Street Journal 10/19/2009

Nokia Needs a Reboot

Wall Street Journal 07/21/2010

How Nokia Fell from Grace

BusinessWeek 09/15/2010

Nokia Optimism? Tough Call

Wall Street Journal 10/22/2010

Nokia's problems and opportunites in China 2012-2013

04/19/2012

Grouped Articles

China at Heart of Nokia's Troubles

Wall Street Journal 04/19/2012

Nokia Plots Cheaper Lumia

Wall Street Journal 04/20/2012

Verizon's Answer to iPhone: Windows

Wall Street Journal 04/20/2012

The Two-Horse Smartphone Race

Wall Street Journal 04/24/2012

Nokia to Keep China Focus Amid Revamp

Wall Street Journal 06/21/2012

HTC Beefs Up China Push as U.S., Europe Lag

Wall Street Journal 08/14/2012

Apple and Foxconn

05/29/2010

Apple's audit of working conditions at Foxconn factories in China.

Grouped Articles

Apparel Retailers Confront Tough Options

Wall Street Journal 05/08/2013

Foxconn Tries to Move Beyond Apple’s Shadow

New York Times 05/06/2013

Hon Hai to Add Robotics in China

Wall Street Journal 08/03/2011

Hon Hai to Raise Workers' Pay

Wall Street Journal 05/29/2010

Why Apple and Others Are Nervous About Foxconn

BusinessWeek 06/03/2010

To Woo Apple, Foxconn Bets $3.5 Billion on Sharp

New York Times 03/30/2016

Apple App Store

01/07/2011

Grouped Articles

Apple Says App Store Sales Rose 50% in 2014

Wall Street Journal 01/09/2015

Apple's Cut From App Sales Reached $4.5 Billion in 2014

New York Times 01/08/2015

Apple’s App Store Sales Hit $20 Billion, Signs of Slower Growth Emerge

Wall Street Journal 01/07/2016

Services Business Emerges as Key to Apple’s Core

Wall Street Journal 04/28/2016

Apple Takes Wraps Off Mac App Store

Wall Street Journal 01/07/2011

Apple Launches News Subscription Service for App Store

Wall Street Journal 02/15/2011

Sprint and Apple's iPhone

04/23/2012

Grouped Articles

Apple Takes Aim at Wireless Phone Companies

Wall Street Journal 09/10/2015

Carrier Trade Is Still In Apple's Favor

Wall Street Journal 04/23/2012

The Two-Horse Smartphone Race

Wall Street Journal 04/24/2012

AT&T Hits Dry Patch With Phone Contracts

Wall Street Journal 04/25/2012

Sprint Continues Turnabout; Sales of iPhone Steady

Wall Street Journal 07/27/2012

AT&T and Apple's iPhone

01/11/2011

Grouped Articles

Apple Takes Aim at Wireless Phone Companies

Wall Street Journal 09/10/2015

AT&T Preps iPhone Plan

Wall Street Journal 01/11/2011

AT&T Says No Surprises on iPhone Defectors

Wall Street Journal 03/03/2011

Asian Handset Makers May Find Room to Shine

Wall Street Journal 10/05/2011

Trouble on the Verizon for AT&T

Wall Street Journal 12/21/2011

AT&T Stuck Behind Verizon

Wall Street Journal 01/27/2012

Verizon and Apple's iPad with LTE capabilities

03/07/2012

Grouped Articles

With New Apple iPads, Tablets Move Closer to Passing PCs in Sales

New York Times 10/22/2013

New iPad: a Million More Pixels Than HDTV

Wall Street Journal 03/15/2012

Apple's New iPad a Boon for Verizon?

Wall Street Journal 03/07/2012

Under the Hood of Apple's Tablet

Wall Street Journal 03/16/2012

New iPad users slowed by expensive 4G network rates - The Washington Post

Washington Post 03/23/2012

The Two-Horse Smartphone Race

Wall Street Journal 04/24/2012


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