The Real Reason Samsung is Beating Apple

As Apple’s stock struggles to climb back — the company has lost $280 billion in value since September — a lot of pundits are pointing fingers at lagging iPhone demand. There are even rumblings about the Apple board seeking a replacement for Tim Cook as CEO, though I don’t believe he’s going anywhere. Nevertheless, Apple is losing more and more ground to rival Samsung by the day, a gap that will only widen when the Galaxy S4 debuts. The question is why — and I have the answer.

The real reason Samsung is beating Apple isn’t bigger screens or better marketing, though those things certainly help. It comes down to apps. That’s right: Apple’s biggest strength has become its greatest weakness.

MORE: 7 Things Apple Must Do in 2013

If you watch any iPhone or iPad commercial today, it’s all about apps. The message: Smartphones are Swiss Army knives, and we have the best tools to help you get the most out of your phone. Well, we don’t, Apple is saying, but our store does. You just need to pick the right app from among more than 700,000 options. That’s not a very sexy message to me. Meanwhile, Samsung has moved in the exact opposite direction.

Just look at the Galaxy S4, which has so many features that owners might forget the Google Play store even exists. The camera app offers a wide array of functions, from dual-shooting using the front and back camera to an Eraser mode for deleting unwanted subjects from photos. Then there’s the gesture support, great for flipping through music tracks with a wave of your hand or answering the phone when you’re behind the wheel. Add in the S Fitness and S Translate apps and you have far fewer reasons to research and download apps.

Here’s Samsung’s message: There might be an app for that, but why bother?

There’s no question that most developers continue to choose iOS first for debuting their apps. Flipboard, “Infinity Blade,” Vine and Twitter #Music are just a few examples. But when it comes to choosing a smartphone, apps quickly take a backseat to a better out-of-box experience. Samsung started down this road with the Galaxy S3’s myriad sharing features — such as touching devices to share files — and now it’s stepping on the gas.

Samsung also offers superior multitasking with its Multi View feature, letting you view two apps at the same time, and you can toggle multiple settings from the notification area without having to dive into the settings menu. As more smartphone users become power users, Samsung is quickly becoming the step up phone for iPhone owners.

If you judge the iPhone 5 based on the overall user experience and not the design, you’ll find that Apple isn’t innovating quickly enough. And when the company does try something new, the results are mixed at best. While Shared Photo Streams and Siri’s newfound sports and movie knowledge have been welcome enhancements, Maps was a flop and Passbook feels like a half-hearted attempt to enter the mobile payment fray.

MORE: 5 Ways the Samsung Galaxy S4 Makes the iPhone Look Ancient

I’m not saying that apps don’t matter. Both Microsoft and BlackBerry wish they had more of them so their platforms could gain traction. But once you blow past the 500,000 mark and you’ve covered most of the options consumers want, there comes a point of diminishing returns.

In order for Apple to slow Samsung’s momentum and truly create the smartphone to beat, the company will need to do a lot more than just “flatten” the design of its upcoming OS. The next iPhone and iOS 7 must offer features that are so clever and essential that shoppers visit the App Store less. In other words, Apple must bite the hand that feeds it. Hard.

Editor-in-chief Mark Spoonauer directs LAPTOP’s online and print editorial content and has been covering mobile and wireless technology for over a decade. Each week Mark’s SpoonFed column provides his insights and analysis of the biggest mobile trends and news. You can also follow him on Twitter and .





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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  1. CJ Says:

    Nailed It!

  2. Steven W. Says:

    I basically just read a write up about why one person likes his Samsung S4 a lot. He then generalized how that this must be why Samsung is beating Apple. Samsung might be beating Apple globally, but it is not because of what this Samsung user writes about. <<<<<<< FAIL

  3. Andrew Allison Says:

    Think different?

  4. Mark Spoonauer, LAPTOP Editor in Chief Says:

    Steven, this is not about my take on the S4. A full review will come later. It’s about the overall trend of providing more robust functionality sans third-party apps. Samsung is leading in that regard.

  5. bro Says:

    So what you’re saying is that Samsung can take on the armies of app developers that are currently developing for iOS. Don’t you think that’s a bit absurd. Samsung may have a couple cool looking apps for S4, but if they really turn out to be popular, how much time do you think it will take for the copycats to come out with similar offerings. Much like what Samsung/Google did when they copied iOS and the hardware from iPhone.

  6. bro Says:

    Also, why is your magazine called “laptop” if it is about mobile.

  7. Michael Says:

    Sure it’s not price?

  8. Wayne Says:

    The author never explains exactly how Samsung is beating Apple. The reader is supposed to accept it as a statement of fact. Does Samsung beat Apple in profitability? No! Apple had 72% of the profits for the last quarter to Samsung’s 29% (http://news.cnet.com/8301-1035_3-57567891-94/apple-samsung-gobble-all-2012-handset-profits-and-then-some/). How about number of smartphones sold? Apple sold more handsets than Samsung every month from 2010 to Dec, 2012 and for the first quarter of 2013 (http://tech.fortune.cnn.com/2013/03/16/apple-iphone-samsung-galaxy/). What about stock evaluation? Apple’s stock is up 5,749% since the start of 2003, while Samsung’s stock is up just 373% (http://www.bespokeinvest.com/thinkbig/2013/3/14/apple-vs-samsung.html). Samsung has a long way to go to catch up to Apple in every regard. Perhaps the author should have done a little homework before writing the headline.

  9. AdamC Says:

    The writer is a fan boy who is expressing his love for gimmicks and exposing his feminine side – look around there are more women using the big phone than men.

  10. mert Says:

    this is a welcome but inadequate mention of value of features samsung phone and tablets provide. value also referring to cost or price. my samsung phones all came with polaris office and its spreadsheet app seemed better to me than numbers i had to payy 10 usd for my ipad .10 for numbers 10 for pages 10 for word, it adds up. again these potential costs generally not mentioned in comparative reviews like between ipad mini galaxy note 8. but people are very aware actually and track money they pay in appstores. also apart from monetary value my note has a torch feature which uses flash of the phone to provide a bright light, i would probably never look for such a feature in an appstore, but it helped me a lot in a number of occasions, and thanked samsug for coming up for that-i am sure it would not have been considered for iphones i previosly owned. would u call it innovation, probably not but it had value for me. i also fin interesting reviewers coming up now only why samsung is doing so well, now that value loss in apple shares is so visible. Yet samsung success was apperant from galaxy s2 onwarrds, at least to me from when I switched from iphone 3gs. And because of its features, bigger screen, cheaper price, cheaper price of accessories -5usd for a cable insatead of 20- etc, all known to reviewers at the time. Regards

  11. Mark Spoonauer, LAPTOP Editor in Chief Says:

    Here are some important numbers from IDC.
    (mil. phones) 4Q11 4Q12 Yr/Yr
    Samsung 36.2 63.7 76%
    Apple 37 47.8 29%

  12. Kip Says:

    I guess I was under the misimpression the objective of business in a capitalist society is to generate profits. Apple generates about 70% of the profits the smart phones, Samsung generates under 20%. I suspect the share of profits is even more favorable to Apple on tablets. The NFL doesn’t award victories on the number of yards gained in the game, but on the points on the scoreboard.

    Your fundamental assumption, that Samsung is beating Apple, is flawed. You’re using the wrong metrics for the comparison.

  13. John II Says:

    What nonsense. Apps are for girls. No one chooses a Samsung over an iPhone for “apps”. Samsung is succeeding because it offers a decent product that men are impressed with. Women stick with iPhone because that’s all they know.

  14. AlfieJr Says:

    what a crock of hit-whoring poop.

    Samsung sells a lot of cheap phones around the world, yes. some are “smart” some kinda-smart. fewer tablets, but that will likely grow. unless the other Asian (or Nokia hah hah) OEM’s start to catch up with Samsung.

    but do the revenues match Apple’s? no. the profits? no. not even close.

    go away. go troll the web in some other language.

  15. jb82 Says:

    Yeah whatever. Tomorrow apple stock will skyrocket when everyone opens their eyes are realize they are still holding an iphone

  16. GameIndica Says:

    Inspiring article but hey, apple provides a complete environment for the users to stay and be comfortable using all the services they provide. notebook, tv, remote, music player, gaming and whatever i-device u have, all come with the “services synced”. Samsung is showing good numbers for its cheaper price and some leaping innovations but in the long run, how can it stay on the same level with THE MIGHTY APPLE? even microsoft has a better chance at it with their console+phone+pc setup. or are you talking about only the smartphone market?

  17. Ben Says:

    In which parallel universe is Samsung beating Apple exactly ? Like the one Dell is beating Apple in PCs maybe ? Dell sells more PCs worldwide than Apple, but no one with a sane mind will say that Dell is beating Apple.

  18. Donn Lobdell Says:

    I am afraid that you are confusing design and styling. Design is first and foremost about user experience.
    To claim that Samsung gives a better user experience but Apple has better design is nonsense or a contradiction in terms. Virtually every time I use an Apple product, I wish that they hadn’t traded design in on styling.

  19. Jack Says:

    Wow you really brought out the ignorant Appleites with this one.

  20. SteveS Says:

    I guess the question one has to ask is what’s the definition of “winning”?

    Okay, Samsung sells more units globally than Apple. That said, Apple is taking home 70+% of the profit share from the mobile market. Samsung’s tablet market is barely measurable. Apple is beating Samsung (and Android in general) in all of the US carriers where they compete. Apple also controls it’s own ecosystem and Samsung is beholden to Google’s system. How that translates to Samsung winning is a mystery to anyone taking a look at what’s actually happening here. Samsung’s victories are coming at the expense of various other Android OEMs.

    Also, it’s clear the author of this piece doesn’t understand the definition of innovation. Throwing together a bunch of gimmicky aftermarket hacks to their UI in hopes that even one of them proves useful isn’t innovation. It’s just a mess. Rather, offering a unified and consistent UI that is uncluttered, yet functional is the more difficult achievement.

  21. mr harrison Says:

    I agree with all of the above comments stating that this is a one sided argument from a guy that obviously loves his Samsung. Not really a good comparison when you are comparing two things and you have a clear favorite.

  22. Cindy Says:

    I have had a Iphone 3 , 4 and Iphone 5. I have also have a Samsung Infuse, Galaxy S2, Galaxy S3 Note 1 and Note 2 and now have a Galaxy S4 and I can tell you that there is so much more that you can do with the Samsung phones compared to the Iphone’s that they are not even close in comparison. That being said my daughter loves her Iphone 5 and I can not convince her to even try an android phone, but she doesn’t like change which is why she sticks with the Iphone there is just not much change there between the Iphones.

  23. Josie cat Says:

    Want proof Apple is in trouble, just this week Apple made monstrous buy back of Apple stock. This just weeks before the “new” unveiling of iphone 5s or iphone 6. Things are not well when factoring in the total number of android sales. Iphone is drastically losing ground every quarter, especially outside the US. And of anroids Samsung is king. Want proof, apple is turning into Microsoft, making lawsuits rather than bettering a phone that’s 3 years too old. Outside of the US iphone capability is a dinosaur. China knock offs are a baker’s dozen in the Asian market place, due to fact they haven’t changed anything for years. With Steve Jobs passing Apple is losing its focus and innovation, and turning to bully tactics with lawsuits. I hope Apple does make a strong comeback this or next year. If can make a massive computing headset with style, which S4 lacks, would make a switch back. Till then will stick with the lower cost more powerful and larger Samsung line.

  24. common sense Says:

    Samsung selling more units translates into greater market share and brand name power. This limits apple’s growth and the more they are challenged the more they have potential sell base abandon them for an alternative. This process will be expedited when Samsung creates a phone out of perceived “premium” materials to accompany the better out of the box experience. Then how will apple maintain the ridiculous margins they do on their phone ? I’m not sure they can or will with their one phone product line. Can they maintain the “apple magic” developing more then one line ? People already seem displeased with the level of tech updates the iPhone isn’t receiving. But hey they got those apps….. for whatever good it’ll do them, I for one don’t buy apps I buy software programs for my desktop though.

  25. Lakeville Says:

    What an odd bunch of comments. Lets face it, the thing is a phone on
    steroids. They all make calls, its the bells and whistles that set them
    apart. They all have a two year life expectancy. New contract, new
    phone. It could be Samsung, Apple, Microsoft or Rim. Who cares about
    stock prices, market share or name? IT’S A PHONE. Give me the most
    bang for my buck for the next two years. Life is to short.

  26. Mark Says:

    AlfieJr:
    You DO know that Apple got sued by Nokia for stealing patent rights right? Hence why Nokia won!
    Yes sure Apple is better at marketing so stealing other ppl’s innovation and giving them “chump change” for stealing Nokia’s technology may be nothing.
    But I don’t support thieves! Nokia doesn’t know how to use their money wisely and can’t compete with Apple when it comes to marketing. But still, if you are dissing other companies then think about what that makes Apple for not even being the ones who invented the technology in the first place… LMAO

  27. Ray Says:

    Apple has been overcharging for their products for many years. As much as 5000% on some products. I would not call that profit margin. Since all their products are manufactured in China they should have been pricing fairly, but they saw an opportunity to get filthy rich and took it. Now it is literally biting them back. All that ill gotten cash won’t help very much.
    I am glad to see someone coming to our rescue and its called competition. Apple has been able to stifle competition but no more. We get ripped of daily by the big companies. cellphone companies are next on the list of gougers.
    My wife uses an iphone and complains of the very high prices on hardware and apps.
    I agree they are outrageous and my question is where and how does Apple hide the Billions they do not report?
    They are becoming more like Microsoft every day.
    Innovation only can do so much, dropping prices is too late.

  28. Maarek Says:

    iOS devices are oversized Palm Pilots, they could never multi-task. People wanted simplicity, but now they realized that they want phones to do more and iPhones CANNOT do that. Android is the new mobile PC.

  29. chris Says:

    I went to the telco store with a girlfriend, and she asked for the phone that most women are buying. She walked out with a galaxy note 2. Maybe apple should listen for once.

  30. atruth Says:

    Samsung is simply incorporating apps into its own interface. ironically, it’s iphone that offers more choice than this android phone. iphone has dozens of camera apps. and lets you choose hte one you want.

    samsung products are second rate. having more features doesn’t change that anymore than Hyundai matching or beating features of a Lexus makes the Hyundai a better car.

    i’ve had Samsung’s phones and iPhones, and the iPhones are just better. not sure why, it’s a million little things that add up to a better experience. within a couple of weeks i was using the iphone for far more than i ever used my Samsung Galaxy II, and i liked it a lot more. one concrete advantage is that the iPhone never, or rarely, locks up and needs to be rebooted. my galaxy i had to reboot once a week on average because it would either freeze or lag or something else would go wrong. my iphone had to be rebooted like twice in 18 months. at first i missed my weather widget, but that’s about it.

    samsung spends bilions on advertising and marketing. as aprt of that it also pays people to post comments on boards. don’t belive me? google it. it got caught and admitted doing this in Taiwan recently, and no one seriously doubts they do it everywhere. reading half the comments here it’s easy to see. most people don’t feel that strongly about a smartphone, yet comments about Samsung products are rabid, much more so than purported apple fanbois. i liked the iphone better, but really don’t care that much. i lived fine with the galaxy. but in terms of whichi was superior, it’s the iphone.

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