Google's Battle With Samsung Will Reshape The Smart-Phone Market

Gregory Vousvounis profile picture
Gregory Vousvounis

When it became clear a few months ago that Samsung's (OTCPK:SSNLF) market share in Android smart-phones has risen to 46% and keeps rising, Google (NASDAQ:GOOG) realized that it may be in deep trouble.

The reason Google worries about Samsung's success, is that Samsung may become a de facto co-owner of Android. Android's success lies in its openness. Having many OEMs compete over who makes the best hardware is crucial, as Google tries to make Android the standard OS for smart-phones.

Unfortunately, Google's worries aren't misplaced. After Google acquired Motorola Mobility in early 2012, Samsung decided to seriously transform its open source LiMo project into a full smart-phone OS called Tizen. With Tizen Samsung is trying to create an Android-like OS in case Google decides to stop giving Android for free and starts making its own phones with Motorola.

So far Samsung seems to have done a good job and the latest version Tizen 2.0, seems to be good enough to compete with Android. Although Tizen is still under development and doesn't have a live ecosystem, we shouldn't dismiss it because things could turn ugly for Google very quickly.

In particular Samsung has demonstrated popular android titles on Tizen and has designed it to offer cutting-edge HTML5 support, ensuring that it will run web apps efficiently.

Furthermore, Samsung seems to understand perfectly how important the ecosystem is for a mobile OS and with the release of Tizen 2.0 has tried to make developers' work as easy as possible. Last but not least it has already enlisted support by many big carriers like Vodafone, Orange, Sprint and others.

If Samsung continues to conquer market share and builds a good Android app emulator (like BlackBerry (BBRY) did) for its OS, then Android's dethronement would be a highly probable outcome.

Of course Google doesn't

This article was written by

Gregory Vousvounis profile picture
I am a full-time investor mainly focused on US equities. I don't subscribe to any investing style. I just look at companies I understand and if the opportunity is right I act on it. I am looking for high-return opportunities but I am extremely conservative about the downside. My strategy could be summarized in the phrase:`"Tails I win a lot, heads I still make some money.".I have been in the markets actively since 2006 and I have learned that the key is to focus on simple and clear-cut opportunities. After all, no one is forcing us to invest if the opportunity isn't the right one.

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