For over a decade, the leaders of South Korea’s largest chaebol could boast about their company’s advantage over the strongest smartphone manufacturer in Silicon Valley.
Samsung was, after all, the world’s largest smartphone manufacturer, surpassing Apple. While Americans often preferred iPhones, the rest of the world favored Samsung’s competitively priced Android devices.
However, things changed last year.
By the end of 2023, Apple had overtaken Samsung for the first time in 12 years, capturing 20.1% of the global smartphone market share, according to IDC.
Samsung was partly affected by the broader market landscape. IDC reported that global smartphone sales declined by 3.2% in 2023 to 1.17 billion units. This indicated that users were upgrading less frequently, especially amid high inflation. The company also faced some external troubles, such as the indictment of Samsung Electronic’s Chairman Lee Jae-young on bribery and financial violation charges.
Putting those troubles aside, Samsung is focusing its efforts on developing a crucial area that promises to be a game-changer in its race with Apple: artificial intelligence.
Samsung Leads the Way in the AI Era
The South Korean giant anticipates all eyes will turn to Paris on July 10 as they unveil their “next big thing” in AI aspirations at the annual Galaxy Unpacked event.
This moment couldn’t be more crucial.
Last month, Apple announced Apple Intelligence, a vision for AI that could deliver entirely new experiences for the iPhone. Apple hopes to inspire users to upgrade their iPhones to access the full range of its AI features.
Apple introduced Apple Intelligence at the WWDC event in June.
The features include an enhanced Siri, augmented email and messaging tools, image creation support, and the integration of OpenAI’s ChatGPT into the iPhone, iPad, and Mac operating systems.
For Apple, the company faces intense competition in key markets like China. Apple is betting big on Apple Intelligence, believing that AI will be so enticing that consumers will be willing to upgrade their phones (only the newest models like the upcoming iPhone 15 Pro and iPhone 16 will feature AI capabilities).
With their rival making moves, Samsung needs to step up its AI game. They debuted Galaxy AI with the first products featuring AI capabilities at the Galaxy S24 launch in January.
Galaxy AI includes a suite of features such as “circle to search,” which lets users find anything they see on the screen, along with real-time call translation and advanced photo editing tools.
Galaxy AI has been available on Samsung devices since January 2024.
While Apple requires users to upgrade to newer devices to access its AI features, Samsung seems to be taking a different approach.
Galaxy AI is compatible with older devices like the Galaxy S23 and Galaxy Z Fold 5, as the company aims to make its AI features as widely available as possible, as soon as possible. This gives Samsung users the opportunity to assess the value of AI capabilities before deciding to upgrade their devices.
There are signs that Samsung is making a comeback.
Last week, Samsung Electronics estimated that its profit would surge to $7.54 billion in the second quarter, up from just $485 million a year earlier.
Samsung also overtook Apple in the first three months of the year as the world’s top smartphone manufacturer, according to IDC.
Samsung’s hope now is that its AI vision will help it surpass Apple for the full year.
The company stated that the Unpacked event on July 10 will usher in “a new era of mobile AI” – a phase they expect to return them to the throne of the smartphone world in the AI era.
Source: BI
