Is Samsung Overly Reliant on Smartphones?

Is Samsung Overly Reliant on Smartphones?

Samsung Electronics achieved record earnings in the third quarter of this year, but experts warn that the smartphone market faces huge risks. The biggest problem is Samsung's dangerously high reliance on smartphones to drive up revenues.

Although the electronics giant did not reveal earnings by individual business division, analysts believe the mobile division, which includes smartphones, accounts for 65 percent of total quarterly operating profit of W10.1 trillion (US$1=W1,070).

In turn, Samsung Electronics accounts for 66 percent of the entire Samsung Group's revenues. That means that slow smartphone sales could rattle the entire group badly. Experts warn that Samsung must come up with new growth engines for a time when the global smartphone market is saturated. Otherwise it could go the way of former rivals Nokia and Blackberry.

Samsung is confident that its strong performance in the smartphone market will continue. Sales of the Galaxy S4 rema in strong, and those of the Galaxy Note 3 released recently will be reflected in fourth-quarter earnings, according to the company.

But market conditions are not entirely favorable. Market growth for premium smartphones is slowing, and Chinese rivals are catching up quickly in low- and mid-priced phones, which have the strongest growth potential in the years ahead.

Even Apple, which stuck to high-end phones for years, has started to sell mid-priced phones as well.

It remains to be seen whether Samsung can meet its target of selling 100 million Galaxy 4Ss, said Kim Ji-woong at E*trade Securities. He said analysts lowered their earnings expectations for Samsung Electronics, triggering its share price and market cap to fall. In June, JP Morgan lowered its smartphone output forecast for Samsung, causing the company's market cap to decline by W15 trillion in a single day.

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User manual of the LG Nexus 5 leaked with specifications

User manual of the LG Nexus 5 leaked with specifications

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As MacBook Air ages, Apple rivals show the way to Retina

As MacBook Air ages, Apple rivals show the way to Retina

HP Spectre 13 is 3.25 pounds, 15mm thick, and can be equipped with a 2,560-by-1,440 touch display. The raw physical specs mimic a 13-inch MacBook Air -- minus the very high resolution display.

(Credit: Hewlett-Packard)

The Windows 8.1 crowd is demonstrating that a Retina version of the MacBook Air is possible if Apple is willing.

Certain aspects of the Air are getting long in the tooth. Particularly the display. That shortcoming forced me to trade in my Air -- I got the first MBA in March 2008 and used it and newer versions for the next four years -- for a 13-inch MacBook Pro Retina.

I needed the extra desktop space the scaled display settings provide (1,680x1,050 in my case), and I appreciate the clarity of a Retina screen.

That said, I miss the Air's tablet-esque portability.

Enter the latest round of Windows 8.1 featherweight lappies, which trounce the MBA's unimpressive 1,440x900 (13-inch MBA) and 1,366 x768 (11-inch) resolutions.

Let's look at some of the competition that was announced this week to see just what Apple is up against now. All come with Intel's latest "Haswell" processors.

• HP Spectre 13: At just over 3 pounds and about 0.6-inches thick, it's pretty close to the current 13-inch MacBook Air. But it can be configured with a 2,560x1,440 touch display. That resolution is only a little less than the 13-inch MacBook Pro and not enough for anyone to see the difference: 227 pixels per inch for the MBP vs. 220 for Spectre 13. It starts at $1,000.
  
• Dell XPS 11: The XPS 11 weighs 2.5-pounds, is 0.57-inches thick, and sports a chassis made from machined aluminum and carbon fiber. Dell squeezes a 2,560x1,440 resolution touch display with 400 nit brightness into an 11.6-inch design. That blows away the 11-inch MBA. To wit, that's 253 pixels per inch for the Dell vs. a mere 135 for the MBA. It will start at $1,000.
  
• Sony Vaio Pro 11: While this was announced back in June, it's a good competitive yardstick. The 2-pound 11.6-inch Vaio Pro comes with a 1,920x1,080 touch screen. That handily beats the Air's screen. And the price isn't too bad either: $1,150 (and $1,100 at some online retailers) with a 128GB SSD.
  

Here's another feature the Windows camp can crow about. All of the above have touch screens.

Despite what Apple has said in the past about the ergonomic impracticality of a touch screen on a laptop (e.g., your arm will get tired pocking at a vertical screen), it's becoming a feature de rigueur.

A word of advice: Hey Apple, I know you're a "post-PC" company but let's update the Air and bring it into the post-grainy-screen era.

2013 MacBook Air. A good design that's getting old in some respects.

(Credit: Apple)