Out for redemption: Samsung to fire on all cylinders with Galaxy S8

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Out for redemption: Samsung to fire on all cylinders with Galaxy S8
Several leaks have revealed a lot about Samsung's Galaxy S8, but the real deal will finally be seen on Wednesday in New York.

Dubai - Tech giant has reasons to be optimistic at Wednesday's Unpacked event in New York

By Alvin R. Cabral

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Published: Sat 25 Mar 2017, 7:02 PM

Last updated: Sun 26 Mar 2017, 10:25 PM

On Wednesday, Samsung will be revealing its newest smartphone, the Galaxy S8, at its Unpacked event in New York (7PM Dubai time).
There's no shortage of hype when the South Korean tech titan unveils a new flagship. But thanks to the Note 7 disaster - plus the saga involving Samsung boss Jay Y. Lee - the anticipation is sure to shoot through the roof this time around.
Samsung was pegged to take a $17 billion hit (Dh62.4 billion) as a fallout from the fire-prone Note 7.
Gartner's recent report on the smartphone industry showed that in the fourth quarter of 2016, Samsung posted an eight per cent drop in sales - losing 2.9 percentage points overall - and was its second straight quarter of decline. This was, of course, to be blamed on the Note 7.
"Samsung's smartphone sales started to drop in the third quarter of 2016, and the decision to discontinue the Note 7 slowed down sales of its smartphone portfolio in the fourth quarter," Gartner research director Anshul Gupta said in the report.
"The withdrawal of the Note 7 left a gap in its large-screen phone range."
But forget about the monetary aspect of it; the damage done to its reputation was huge.
"This is the first time that I have seen a product recall go this badly wrong," financial analyst Richard Windsor said on October 12, the day after Samsung finally decided to cease production of the Note 7.
"When it comes to the damage that it will do to Samsung's brand, we are in unchartered territory."
However, Samsung is, well, still Samsung. As at Thursday, Bloomberg lists its market capitalisation at over $260 billion, enough to overtake the 11 most valuable firms listed in the United States.
And while there are sceptics indeed, analysts say don't write off Samsung that easily. Carolina Milanesi, principal analyst at Creative Strategies, argues the key for Samsung is to win back trust that it will continue to innovate.
"Consumers are generally quite forgiving and have a relatively short memory. The car industry has seen several recalls over the years, yet consumers continue to buy," she says.
"What is even more important when we are talking about a market leader, especially one that has gained that position by adopting new technologies early, is to show that its innovation streak will not be limited by fear. Samsung must show consumers that it has set in place checks and balances that will allow the company to continue to bring new technology, new designs and new features into the market in a safe and effective way."
Couple that with the rapid pace of upgrades, and Samsung has every reason to be optimistic: remember, refresh cycles for smartphones are shorter against personal computers and tablets.
 
The Apple factor
Samsung's vice-president for mobile communications, Lee Kyeong-tae, has gone on record saying that the Galaxy S8 will feature a "slick design and an improved camera, as well as an enhanced artificial-intelligence service".
Meanwhile, leaks have all but confirmed what we can expect from the Galaxy S8, which include, among others, facial recognition that can be used for payments; almost zero bezels; a "Samsung DeX" dock, which can be used to connect the device to a computer monitor akin to Microsoft's Continuum; and prices of ?799 (Dh3,171) for the S8 and ?899 (Dh3,568), the last one according to famed leakster Evan Blass.
These features may not be enough to entice buyers, if noted KGI Securities analyst - and accurate predictor - Ming-Chi Kuo is to be believed.
"We are conservative on demand for Galaxy S8, and believe its contribution to the supply chain will be limited," he wrote, adding that KGI sees only 40 to 45 million shipments in fiscal year 2017, much less than the 52 million for the Galaxy S7 in a comparable time frame.
Meanwhile, keep an eye out for Apple's next biggie - the "iPhone 8" - in September. There is considerable hype surrounding Tim Cook and Co's 10th-anniversary offering, which may sway customers a bit, given rumours and leaks coming out.
"Instead, we recommend focusing on the sales outlook and supply chain momentum of Apple's [US] OLED iPhone model," Kuo noted.
It will be D-Day for Samsung on Wednesday. And ending the wait for the Galaxy S8 is one thing; waiting patiently to find out how it pans out is a completely different thing altogether.
- alvin@khaleejtimes.com


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