(credit:Google)
Samsung Electronics Co. introduced a faster, larger version of its flagship smartphone, aimed at sustaining its strong growth in advanced cellphones and avoiding an escalation of a global patent dispute with apple Inc. AAPL -2.18%
The Galaxy S III, unveiled at an event in London on Thursday, features facial-recognition technology and a souped-up processor that allows users to watch video and write messages at the same time.
Samsung is hoping the new smartphone will help dent its rivals' market share ahead of an expected new version of Apple's iPhone this year.
Suwon-based Samsung has generated impressive momentum in cellphones: Samsung's first-quarter net profit rose 82% from a year earlier to a record 5.05 trillion won ($4.47 billion), with three-fourths of that coming from its phone business.
However, the new phone comes as Samsung is set to face intensifying competition, not only from Apple, but also from Chinese manufacturers such as Huawei Technologies Co. and ZTE Corp., 000063.SZ +2.59% who are building less-expensive smartphones and phones under their own brands.
Reflecting the increasingly competitive smartphone business, J.K. Shin, president of Samsung's mobile business, said in an interview that Samsung expects second-quarter earnings from its mobile business to be similar to the first.
Samsung aims to sell more than 200 million smartphones this year and grab 23% to 24% of the global handset market, Mr. Shin estimated, up from 21.1% last year.
Samsung didn't provide shipment data for its smartphones but some analysts estimated that it outsells Apple.
Samsung shipped 44.5 million smartphones in the first quarter, topping Apple's 35.1 million, according to Strategy Analytics. Samsung also overtook NokiaCorp. NOK -10.38% as the biggest handset maker.
In contrast with Apple, Samsung's strategy for growth has been to sell a wide range of phones to soak up demand across price points. Mr. Shin said the company plans to offer more sub-$150 smartphones and introduce a smartphone using Microsoft Corp.'s MSFT -1.27%operating system in September.
He declined to provide a sales forecast for the new Galaxy smartphone or comment on its price other than to say it would be more expensive than its predecessor, the Galaxy S II, which retails in the U.S. for about $500 without a contract from AT&T Inc. T -0.72%
The new phone will hit stores first in Europe, including London, at the end of this month. It is slated to reach the U.S. in the summer. It's not clear which carriers will offer the phone in the U.S., but the previous model was available through all four carriers—AT&T, Verizon Wireless, Sprint Nextel Corp. S -3.33% and T-Mobile.
Mr. Shin said the phone includes software and design modifications that won't be subject to patent litigation. "Features that were identified in previous lawsuits aren't in this new model. We've created and invented many technologies," he said.
Apple and Samsung are embroiled in a global patent dispute over design and technology of mobile devices. A U.S. court has ordered the chief executives of the companies to hold settlement talks on May 21 and 22, which could set a precedent for other cases around the world.
Mr. Shin said Samsung would continue to fight the patent suits but acknowledged that a negotiated end would be preferable. "Of course, fundamentally, settling would be better," he said.
Samsung's new Galaxy S phone runs on Google Inc.'s GOOG -1.56% Android software and comes with a faster chip—a quad-core processor developed by the company to match the iPhone—that allows users to watch video while emailing, for example.
It also has voice and face-recognition capabilities. Samsung said the smartphone can detect eye movements and override the automatic shutdown feature if the user is looking at the 4.8-inch screen. The previous Galaxy S phone had a 4.3-inch screen, while the iPhone 4S's screen is 3.5 inches.
The new phone's main camera has a resolution of eight megapixels, the same as the previous model and comparable with the iPhone.
The first version of the new phone will run on third-generation wireless networks, but Mr. Shin said that versions for 4G networks will be available in the summer.
"The S III is an evolution but not a revolution," said Neil Mawston, executive director at Strategy Analytics. "It's an improvement but it's not a game changer nor an iPhone killer.
"Samsung's strategy is to offer good hardware at a cheaper price so it'll give Apple some pause for thought," Mr. Mawston said. "It could put some pressure on Apple to develop a vastly improved iPhone 5."
(courtesy:wsj.com)
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