Smartphone Industry in 2013: Samsung's Dilemma
Smartphone Industry in 2013: Samsung’s Dilemma
Case Analysis
By
Kunal Sharma
100410018
Strategic Management
BUSI 4701-002
Basir, Nada
Date: 03-05, 2015
Word Count:
1. To determine the industry attractiveness in the smartphone industry in 2013 we will need to use Porter’s five forces analysis.
Threat of new entrants
According to research, “many industry watchers had labeled mobile telecommunications as one of the most competitive industries in recent years.”(pg1) because the industry was so intensely competitive entry into the market was virtually restricted. Although, Google’s operating system “Android” allowed for any manufacturers to use and modify the OS for free (pg4) the leading smartphone companies had acquired patented technologies through mergers and acquisitions; technologies which would be used in the manufacturing of a smartphone. (pg8) The industry leaders share their technologies amongst themselves but would not make them available to new entrants into the market, most likely due to the fact that the new companies would not bring significant resources to the table to exchange patented technology with. Another reason a new entrant would not be not able to enter the industry is because of ongoing legal battles between the industry leaders for patent infringements, which means that new entrants must have significant capital to protect themselves if a legal battle were to start and also they were infringing on the patents they would have to also have enough capital to pay for the damages they would cause. In my opinion brand loyalty is also a factor that limits new companies from emerging in this industry due to the fact that the industry leaders spend billions on advertising and creating a community of loyal brand enthusiasts. They also create products that work in sync with one another such as the iphone, ipod, and ipad created by apple (pg5), this makes the users decision to switch brands a very costly one and most of them choose to
Case Analysis
By
Kunal Sharma
100410018
Strategic Management
BUSI 4701-002
Basir, Nada
Date: 03-05, 2015
Word Count:
1. To determine the industry attractiveness in the smartphone industry in 2013 we will need to use Porter’s five forces analysis.
Threat of new entrants
According to research, “many industry watchers had labeled mobile telecommunications as one of the most competitive industries in recent years.”(pg1) because the industry was so intensely competitive entry into the market was virtually restricted. Although, Google’s operating system “Android” allowed for any manufacturers to use and modify the OS for free (pg4) the leading smartphone companies had acquired patented technologies through mergers and acquisitions; technologies which would be used in the manufacturing of a smartphone. (pg8) The industry leaders share their technologies amongst themselves but would not make them available to new entrants into the market, most likely due to the fact that the new companies would not bring significant resources to the table to exchange patented technology with. Another reason a new entrant would not be not able to enter the industry is because of ongoing legal battles between the industry leaders for patent infringements, which means that new entrants must have significant capital to protect themselves if a legal battle were to start and also they were infringing on the patents they would have to also have enough capital to pay for the damages they would cause. In my opinion brand loyalty is also a factor that limits new companies from emerging in this industry due to the fact that the industry leaders spend billions on advertising and creating a community of loyal brand enthusiasts. They also create products that work in sync with one another such as the iphone, ipod, and ipad created by apple (pg5), this makes the users decision to switch brands a very costly one and most of them choose to