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Samsung Galaxy Gear May Change The Apple iPhone Release Story

Sep. 05, 2013 11:41 AM ETGOOG, SSNLF, AAPL65 Comments
Douglas Ehrman profile picture
Douglas Ehrman

On September 4, Samsung (OTCPK:SSNLF) introduced its new Galaxy Gear smartwatch a full week before Apple (AAPL) is expected to roll out the next generation of iPhones - the iPhone 5S and the iPhone 5C. What Apple is not expected to introduce is the much anticipated iWatch, which some believe may be delayed by as much as a year. While the Apple faithful may argue that there is no connection between the release of Galaxy Gear - which runs on Google (GOOG) Android - and the release of the next iPhones, investors should pay attention to early reviews of the smartwatch because, I believe, they have the power to color how the iPhone release is viewed.

Apple's Challenges

Last fall, when Apple released the iPhone 5, some critics felt like the new device was not splashy enough to make a big difference. Despite record sales figures, Apple stock peaked above $700 per share and proceeded to sell off to below $400. Apple needs to build on the little momentum it has gathered over the last few weeks, and a muted reception for the new devices should be seen as a blow. Knowing these stakes, there are two specific factors you should watch.

First is the fact that one of the biggest upgrades expected to accompany the iPhone 5S release is the introduction of iOS 7. The new OS is expected to significantly change the look and feel of the iPhone more dramatically than ever before, as well as add new functionality. This seems like good news until you remember the fact that iOS 7 will be available for the iPhone 5, the iPhone 4S and the iPhone 4 as well. With such an apparently significant upgrade coming without buying a new device, there is at least the potential that many consumers may not rush to have

This article was written by

Douglas Ehrman profile picture
Mr. Ehrman is a hedge fund vet who takes a diversified approach to trading and investing.

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Comments (65)

scott trader profile picture
Aapl could out out an ankle bracelet. A ring or. An I band that relays health fitness info to your smartphone or tablet, no camera no screen no fiddling with it could vibrate or have an led back lit transparent stone that blinks and give alerts...
Eric Dee profile picture
rrosey2, what r u talking about? Samsung doesn't drive AAPL anywhere. APPL goes where there is profit to be made in a leadership role, thought that was pretty obvious, especially to someone who has been around SA as long as you have.
rrosey2 profile picture
Don't bash Samsung. They are what motivates Apple to drive ahead and to innovate.
robehifi profile picture
One Real deal... It Would be.... When Apple Release their Watch (if they do).... And then Samsung... Changes their Design... To be Similar to the iWatch!!!!.... And by knowing them..... They will DO IT!!!!!... What a bunch of non brainers they are!!!
Just the look of the Samsung watch makes me not want Any smart watch.
I'd rather have a 5 to 6" iPhablet & a 3" to 4" satellite iPhone for when I'm out running, cycling or not wanting to pack the girth of a proper size smartphone.
At Apple, Industrial Design rules the roost, period. Samsung's watch looks like crap, a clunky mini-phone straped to your wrist. As many have noted before, a watch is as much of a fashion statement as it is a usable device. I guarantee that when Jony Ive rolls out his smart watch, its beauty and allure will stun people. Take that to the bank.
The clunky nerdware Samsung watch should only reinforce what has probably been decided within Apple -- only release a watch when/if the technology allows an attractive & compact device with the right features. I think currently the battery & display technologies available are not yet at the point that a sufficiently compact & lightweight device is possible. Apple should wait however much time it takes to do it right, whether this is one year or 10 years -- there is NOTHING to be gained by rushing out an inferior product.

Samsung likes to toss things at the wall and see what sticks. Their watch will probably be an epic fail but it will not really harm them; just toss it in the dumpster and try again (or wait for an Apple design to copy).
The story is very simple, Samsung copy again and expends 5 billion dollars in publicity.
The watch looks very much like the 2010 iPod nano that I still wear. It plays music, its sensors track my walks, store photos, is touch screen and as a watch has more than 15 faces and only cost then $120.00. Many band manufacturers produced different styles, including luxury brands. Check this site and you will see the Nano since more than 2 years ago;

Except for Bluetooth I don't see any innovation there only hype.
Apple might have done the right thing waiting to see how the market reacts. Sony's and others experience don't seem to have much track.
Seem that Samsung is try to cover so much terrain from megaphones that have not been well received to Watch. But they don't own the operating system, that is a real hole in their weak and fragile ecosystem now that MSFT bought Nokia
AlphaNeria profile picture
The reviews I've seen for the Galaxy Gear - although I admittedly did not actively search for reviews - have been mildly positive. It doesn't seem like the "oh my god I must have one" kind of positive, but it's good enough to make a splash.

Good article, it makes a lot of sense. Thanks for writing.
shahzam profile picture
I wish there was a way I could filter out authors who do not understand what they write about and simply looking for clicks.
Honestly, good man, I think the watch is a snoozer.

Even if Apple has one, it had better have more stuff in it that the Sammy wrist anchor. Not a good product concept until power is free or chips take small enough amounts to parasitically power things.

I use my arms. I am not going to perch 300 bux of electronics in them while I work waking up some industrial machine or write a report/spec/software on my desktop, which itself already shows me my news, stocks, email, yada yada.

The Samsung PRODUCT is not a problem. The entire CONCEPT as defined this way is a loser. (No kidding,... you have to use it with an expensive phone IN YOUR POCKET AT THE SAME TIME?! The whole shebang costs more than an iPhone 5, NOW! And does what? Puts another camera in my corpus?)

Repeat... even Apple will fail if whatever they have looks like this functionally, economics be damned.
portatopia profile picture
The so called Samsung smart watch is nothing but prototype masqueraded as cool product. Looks tacky with the flat screws on top...god forbids. I guess years of copying Apple they still haven't learned any thing in aesthetics.
Humble Eagles profile picture
Or an antichristian bigot finding new ways to express himself! I don't see the analogy. Finance people are pretty smart about tech. However, anybody looking at the hands-on video can see this thing has a lot of lag to it, and I seriously doubt it will sell. If Apple can't do 10 times better, I don't see them entering this market.
From the article "This seems like good news until you remember the fact that iOS 7 will be available for the iPhone 5, the iPhone 4S and the iPhone 4 as well." And this is the selling point for getting an iPhone. Unlike most phones from other vendors, you are not locked in to the original OS that came with your phone. As the OS is improved, so is your phone.
Samsung's "smart watch" is nothing special. The styling looks like something from the 80's and it has limited functionality and absolutely no appeal to anyone who doesn't own a Samsung phone that works with it. Plus the price is ridiculously high for something that offers little functionality. Samsung is a company that has no substance and they cannot innovate on their own. I'm sure their design and functionality will change dramatically once Apple shows them the way.
The Samsung watch will only work with the Galaxy note 3. That is it. It is a VERY expensive, limited capability accessory for one phone that is the size of a toaster. So, Samsung would have you carrying this over-sized phone, a pizza-box phone cover, a stylus, and watch. Wow......just wow.
kimboslice profile picture
Guys spreading Apple FUD is a contra indicator, give us more SA!
aardvark3 profile picture
The SA "BS FILE" continues to expand.
Azazello profile picture
The article was not pulled from the air it was pulled from somewhere else...
kimboslice profile picture
Should one even comment?
The iWatch will appear when it's finished.
The watch will sell fine because it will be in the Apple store.
I won't buy one probably, but others will if it has some useful functions.
It already exists, people took iPod nanos and made a watchband for it.
Remember Apple hired that French guy from Louis Vuitton or Hermes so it should be a classy product craved by brand conscious people in Shanghai, NYC, Hong Kong, etc.
When shares of aapl hit $1000 I'm popping some champagne.
I can wait a few years, dividends are nice for passing the time.
scott trader profile picture
Aapl let samclone come out first so they could embarrass themselves....their design team is subpar...
funny it wasn't that long ago the rim longs were postulating how the play book was going to be the iPad killer
Funny how not that long ago the msft surface was going to steal market share from the iPad
Funny how not that long ago the Nokia phone was going to steal away iPhone sales overseas because of all the great specs...
It is a good feeling to sit back and watch and listen to all the hubris and smile...
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