According to several press sources, Samsung will introduce the equivalent of a smartwatch that can surf the Web, make phone calls and even tell time. At first, the news would appear bad for Apple Inc. (NASDAQ: AAPL), which is expected to release an iWatch later in the year. However, the product could have effects that will be much farther reaching.
Source: courtesy of Samsung
Samsung’s innovation has been aimed primarily at Apple, but it has hurt the advance, or attempts at turnaround, for several companies. First among these are start-ups like HTC, which launched promising armies of smartphones. After a period of good sales, they were plowed under by what were perceived to be better, or equivalent, products from Apple or Samsung, each of which has the brand and marketing budget to keep an impressive lead in the smartphone markets, HTC, after a string of extremely good earnings, has moved into a position in which it is fighting for its life
At the other end of the smartphone spectrum are Nokia Corp. (NYSE: NOK) and BlackBerry Ltd. (NASDAQ: BBRY). Nether can afford to fall further behind in innovation, when each still has to make products that merely catch up to the market leaders. It is extraordinary that neither company has introduced a next generation wrist smartphone, which would at least have a chance to make a move into the brand new market that could aid in a recovery.
Finally, there are the consumer electronics companies that are the worst off — the PC makers, which have never made a series of smartphones of their own. The fact is that a next generation product will make the chances of recovery for Dell Inc. (NASDAQ: DELL) and Hewlett-Packard Co. (NYSE: HPQ) even worse than they have been.
Samsung’s introduction of a wrist-phone will do a great deal more than threaten Apple.
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