Samsung Exec Talks Notebooks, Netbooks and More

1999. That’s when Samsung started making laptops for the biggest names in the PC biz. And the company has been behind some pretty high-profile portables like the Dell Latitude X1. But what many consumers have been drooling over for the past few years are Samsung-branded notebooks that until now have only been available overseas or through importers. We’re talking about notebooks like the ultra-thin X360 that give the Macbook Air and Voodoo Envy 133 a run for their money. Well, the wait is over, and Samsung is bringing a lot more than just that single system stateside. There will be seven notebooks in the U.S. lineup, ranging from the 10-inch NC10 netbook to the 16-inch R610. Given that Samsung is positioning itself as a premium brand, the timing of a U.S. invasion during a recession might seem a bit odd–if not a tad nuts. But Dave McFarland, senior product marketing manager for mobile computing products at Samsung (who spent 12 years at Toshiba), believes that Americans are willing to pay more for the company’s higher-end designs and cutting edge components. McFarland shared that:

  • Samsung notebooks aren’t going to be cheap, but will blow the competitors away in design, premium quality, and also with the fact that they make the internal components
  • SSDs will become an increasing focus and Samsung’s unique position as a component manufacturer could help them drive down the price of SSD notebooks
  • The NC10 Netbook isn’t just a Fisher Price toy and will sport 3G connection capabilities at a later date
  • Samsung is working with a major retailer on a notebook (read on below for a glimpse into the drama between Best Buy and laptop manufacturers)
  • A Linux interface on top of Vista is a likely move for the company
  • A Samsung Blu-ray notebook could appear on the market soon, but in his opinion Blu-ray does not bring value to the notebook, just added cost.

And that is just a sip of what McFarland shared.  Check out the full interview below and stay tuned for our reviews of Samsung’s notebooks. Why is Samsung entering the U.S. notebook market now? We saw that the Samsung brand was growing through our CE products, mobile phones, and our IT products through our monitors. The completion of the portfolio is the notebook computer. It’s been requested for many, many years by vendors and buyers when Samsung was going to bring a notebook product to the U.S. because they knew they were being made overseas. Now is the time to do it rather than later. We’ve learned a lot about how the business works from a notebook perspective, and at the same time, Samsung has its own research and development. It allows us to say “We’re the leaders in this category. We should showcase our product in that category.” How will Samsung differentiate itself in this cut-throat market? We want to define ourselves as a premium brand. We’re not looking to pry into that category of the $599 or $699 notebook like HP, Toshiba, or even Sony. We want to be hitting the right price points, the right design, and the right specifications. Once that’s established, people either understand the Samsung brand today or they will understand by using one of our products. What’s going to signal to the notebook buyer that Samsung is a premium brand? It’s going to be design. Design in today’s day and age speaks a lot to the product itself. It’s not just hardware inside of a box. Our design is a critical component of our notebook lineup. Some have the Touch of Color design that you’ll find on our monitors and televisions. If someone walks by and they see that Touch of Color design they’re going to know right away it’s a Samsung product. The other aspects of Samsung as a premium notebook brand are internal. Samsung owns and manufactures 60 percent of the components going into a computer today. That’s a big statement that makes a name in an IT company. I’m trying to push harder so that maybe we have a 3 to 6 month exclusive on a part, the hottest thing, like SSD drives. If we come out with a large size that’s compelling to the industry and is cutting edge, we can say this is ours and we’re able to put it into our products and not offer it to our competition in the initial stages. That’s a huge advantage. How else could you leverage the fact that many of your notebooks’ components are Samsung made? You’re going to see it across that across the board. With displays, the RAM, possibly even the hard drive side. There are a lot of those key components, as RAM becomes larger in 5 to 6GB modules, price points will be premium. We’re playing to the premium category. We can have the advantage of having some of those key components ahead of the competition. What was your launch strategy with the seven new notebooks? We’re taking a different approach than most notebook companies today. We wanted to bring a product line with certain categories and certain screen sizes but not flood that category. If Samsung wanted to, we could go from 7 to 20 inch screens and have one in every category. You’ll see a majority of the differences in the products as we go along are going to be a variation in a few products: hard drive specs and CPU specs. We wanted to keep it simple. We didn’t want a ton of derivatives and just go crazy. I hate to use them as an example, but if you look at Apple, and their product line, they don’t have a lot of products. It’s simplistic: Macbook, Macbook Air, not a lot of variations. Do you think Samsung could drive solid state drives into the mainstream? You’ll see Samsung make a huge push next year in SSD as far as not only manufacturing but getting more SSD drives into more of our notebook computing products; that has been a big push from our president. Our pricing is going to be pretty good. Its gotta go into notebooks and make money. Do you feel like you have an advantage in the display area in particular? We do in terms of technologies like LED-backlit screens. Not only do we have the screens but also the tech to create more battery life. Those are in our X series where you see 10 hours of battery life on the X360. You get a really high brightness screen and long battery life. It seems looking at the spec sheets for the new systems that Blu-ray isn’t offered as an option. Why won’t that feature be offered at launch and how soon might you add it? Blu-ray is a subject that we are studying.  We currently sell a notebook with a Blu-ray drive overseas.  Our current strategy for the Q4 soft launch was to try to bring to our customers a solution that was good in spec and also great in price.  We also did not want to bring in so many different offerings, but use the better/best approach.  The notebook computer having a Blu-ray drive today only makes sense if you are using it for business applications.  From the entertainment aspect of it, you need a resolution of WUXGA (1920 x 1200) with 1080i or 1080p support.  Currently today that type of screen is still very expensive as well as there is a premium for the Blu-ray ODD. In our current market research, we have found that adding the Blu-ray drive does not bring value to the notebook, just added cost.  People today are just not watching Blu-ray movies on the notebooks and most notebooks come with  a resolution of 720p.  This much I have learned from all my experience from HD DVD.  With all that said, this does not rule out that Samsung will bring out a Blu-ray notebook in the U.S. market very soon. Who are you targeting with the X360 and X460? The x360 and x460 product category is designed for mobile computing. The difference between the two is that the X460 has an optical disc drive and a larger screen with a discrete graphics option. That’s really the difference between those two products. You define yourself in that category as a user: are you looking for ultrathin or thin-and-light? You have to ask yourself that question: do I need an optical drive? If yes, then the X460 is in your category. You’re paying the premium on the x360 for the portability and SSD. Do you think the NC10 netbook contradicts Samsung’s premium notebook brand message, or do you consider that a separate category? The netbook is designed for conception, not creation. We showcase a large capacity hard drive that allows end users to download content, whether its photos or videos. It’s for minimal video playback, visiting your MySpace, and e-mail. If you’re looking to create videos, that’s not the machine for you. You’re creating something that requires horsepower that’s not available. Analysts have said there were a lot of returns on the Eee PC initially because buyers’ expectations weren’t met. Does that concern you? Our strategy was close communications with major retailers like Best Buy and Circuit City. We asked what the return rate was. They’re all saying they are closely monitoring it, but they’ve been positive because they still want the product. I think it’s going to do fairly well and shouldn’t have any issues. It’s solid. It’s not a Fisher Price toy. Its quality and came from a quality manufacturing company. That’s what we’re hoping to get across. Do you see Samsung offering a flavor of Linux on the NC10 at some point? We are currently looking into a Linux solution, possibly for Q1 09. However, based on our latest information from the channel, it seems that netbooks with Linux have had the highest return rate. Where will consumers be able to buy your notebooks? At first we’ll focus on Buy.com, Amazon.com, and Newegg.com. Going into Q2 of next year, you’ll see us branch into the retail space. For us, Q4 was more of an introduction to get out there and say, what is [the consumer’s] response to the product? Are the sales doing well? Do they feel that Samsung offers them a product that they expect to get? In Q2 we’ll be working individually with retailers to specifically build a computer for their category and for their customer. Best Buy may see us playing in XYZ screen size category. It will be based on their customer base from a design aspect, tech aspect, and a price point that they’re trying to get to. What do you think of Best Buy literally getting into the design process of notebooks? Do you see that trend accelerating as more sales migrate from direct to retail? It’s nice to work with them closely on product lines but, at the same time, who’s the manufacturer and who’s the retailer? They’re getting so big, that it’s great for them, but you know they’re really focused on the customer they deal with on a daily basis. They know what they’re buying and not buying. So they’re trying to build the product that meets that category. We’re working with them closely like everyone else is. They’re now fine tuning to “we see xyz company in this category and you in this category.” They’re trying to define who the manufacturers are and how they play. What is Samsung doing on the software front to enhance the user experience, especially when it comes to adding functionality on top of Vista? We are looking at those types of better end-user experiences, whether it’s a Linux partition in there somewhere or if it’s an overhaul, like HP did on their Touch Smart. Samsung’s mobile phone group is under the same umbrella that our computer group falls under. So when you see the Instinct phone with those applications, those same concepts could be integrated into MIDs and the PC market category as well. Yes, Samsung is capable of doing it. Do we have it on the roadmap? I can’t touch on what we’re bringing out, but we’re capable of it. What about integrating mobile broadband into your notebooks? It won’t be a long time down the road that you see a product that has that. We’re going to be coming out with it very shortly. I’m pushing for 3G on our netbooks. It makes sense in the netbook category. One may be cellular based and one won’t. We currently do that with our UMPC products. We have one that is a version with ATT and one without it. We’ll offer that variation. Where do you stand on wireless USB and WiMax? We are moving forward with both of those technologies, and what has kind of been forgotten but is still around is DLNA as well. And even wireless HDMI. The beauty of Samsung is that we back all of those. How can you make Samsung’s notebook’s work better with your TVs, camcorders, and other consumer electronics gear? For example, I know Samsung is part of the TransferJet Consortium. Could that be something we see in 2009? We have to differentiate from a technology perspective what makes sense in each category. If we decide to grow and build out the entertainment sector in our notebook category, which I hope we do because it’s our background, that’s something I’m going to push. We’re right there with Sony and the rest of those guys on TransferJet. I’m hoping to see it. What kind of support can Samsung notebook customers expect? Is Samsung prepared to handle the additional support burden that comes with releasing consumer notebooks? Currently we have our support staff in place, we are currently using the same staff as we do for the UMPC products, so they are knowledgeable in the PC category.  We have our support staff in New Jersey and we do not outsource outside the country.  They are available 24/7.  Our plans do not stop there.  We are looking to grow our support staff as well as increase our type of service in the year to come.  Details are still being worked out and I can’t provide information on it at this time.

AUTHOR BIO
Mark Spoonauer
Mark Spoonauer
Responsible for the editorial vision for Laptop Mag and Tom's Guide, Mark Spoonauer has been Editor in Chief of LAPTOP since 2003 and has covered technology for nearly 15 years. Mark speaks at key tech industry events and makes regular media appearances on CNBC, Fox and CNN. Mark was previously reviews editor at Mobile Computing, and his work has appeared in Wired, Popular Science and Inc.
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