Samsung plans to offer cheaper tablets to compete in the mobile market, after lower-than-expected sales.
The South Korean electronics giant revealed at the Mobile World Conference it fell short of its sales goal of 7.5 million tablets last year, selling fewer than 6 million devices. Shin Jong-kyun, head of Samsung’s mobile communications business, said the company will launch low-priced offerings to go after a different end of the tablet market this year.
Critics gave Samsung’s Galaxy Tab 10.1 fairly positive reviews, but the device failed to gain traction in the tablet market directly competing against the iPad. Apple shipped more than 40 million units of its tablet last year, while Samsung struggled to maintain its market share against new offerings from Amazon’s Kindle Fire and Barnes and Noble’s Nook Tablet.
Samsung’s decision to focus on making less-expensive tablets is likely a result of the Kindle Fire’s performance. Amazon’s tablet is the only device to put even a slight dent into the sales of the iPad, as analysts believe it was the main reason Apple’s device fell short of sales expectations last holiday season. Now, Samsung is looking to duplicate Amazon’s strategy and make a bigger splash in the tablet market with smaller, cheaper devices.
Competition will grow even steeper for Samsung moving forward however, as Google plans to launch a 7-inch tablet later this year, featuring a pure Ice Cream Sandwich experience. In addition, the software giant aims to push Android tablets from all manufacturers more than ever before, as the company looks to “double down to win in that space.”
Meanwhile, Apple is well-aware it’s losing business to less-expensive devices, which makes matters even more difficult for Samsung. Analysts expect Apple to react by keeping the iPad 2 on the market at a significantly lower price after the iPad 3 launches, rounding out company’s tablet offerings with both high- and low-priced options.
As companies continue to try to strengthen their tablet efforts to take down Apple, the crowded market that emerges could actually help the iPad maker. Customers shopping for a tablet may favor the highly recognizable iPad, and not take their chances with one of the many new offerings from other manufacturers.
Samsung is fine-tuning its strategy for success, but its biggest challenge moving forward will be standing out in a market with a veteran tablet maker like Apple and emerging competition.