Samsung’s latest Galaxy S smartphones a test of market power in a weak market

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SEOUL/SAN FRANCISCO – Samsung Electronics on Wednesday unveiled its latest premium smartphones with a focus on its powerful cameras, in a test of its market power as the cellphone market undergoes an unprecedented contraction.

Analysts said the Galaxy S23 smartphone series, with its cameras and faster chips than its predecessor, could still face weak demand as consumers spend less amid rising inflation in a struggling global economy.

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Recognizing that challenge, the head of Samsung’s mobile experience, or MX Business, told reporters in a post-event briefing that there was a “noticeable shift to the premium segment” in developing and emerging markets. “We intend to focus on the premium segment in developed markets, as well as some of the countries where we see solid growth,” he said.

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The smartphone maker showcased the performance of the S23 Ultra at the Samsung Unpacked event in San Francisco with clips from two movies, “Behold” by Ridley Scott, director of “Gladiator” and “The Martian,” and “Faith” of South Korean director Na Hong-jin both filmed using the top-line Galaxy smartphone.

It is Samsung’s first ever 200-megapixel camera sensor, and the series uses Qualcomm Inc’s Snapdragon 8 Gen 2 mobile processor. Qualcomm said that with the S23 series, 100% of the processors used come from Qualcomm.

At the event, executives from Samsung, Qualcomm and Alphabet Inc’s Google gathered on stage to highlight their partnership in the XR space, which includes virtual and augmented reality.

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Anshel Sag, an analyst at Moor Insights & Strategy, said the three collaborated in the XR space about a decade ago, but the reboot to partner this time comes as Apple Inc is expected to launch its mixed reality headset this year .

“I think it’s designed to give both Samsung and Google a little more credibility in the XR space because they’re both absent on the hardware side for quite some time,” Sag said.

In the United States, the base Galaxy S23 will be priced from $799 and two versions with higher specifications, the S23 Plus and S23 Ultra, from $999 and $1,199 respectively. Samsung kept prices at the same level as for last year’s model despite increases in component costs.

However, global smartphone shipments showed their biggest ever single-quarter decline in the October-December period, falling 18.3% on a year earlier to 300.3 million units, according to data released by research firm IDC last month . The figures cast doubt on forecasts for a modest recovery in the mobile market this year.

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In that tough environment, analysts said Samsung’s mobile strategy would center on profitability through premium offerings, including the S series and foldables.

“Samsung cannot afford to focus more on expanding volume,” said Liz Lee, associate director at research firm Counterpoint.

“It should boldly simplify low- and mid-range products, the parts of the market where Chinese competitors have caught up a lot.”

Samsung said on Tuesday that a decline in low- and mid-range smartphone sales in the fourth quarter was greater than expected. (Reporting by Joyce Lee; Editing by Jonathan Oatis and Christopher Cushing)


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