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Fall in the United States market? Samsung’s dominance will be shaken

2016-10-11
Lasted more than a month of Samsung Galaxy Note 7 (hereinafter referred to as Note 7) bombing machine is still spreading scandal. Samsung Electronics said on Tuesday it would require global mobile operators and retail partners to stop selling Note 7 phones, and require Note 7 users to shut down, stop using.
After the release of Note 7 mobile phones, has occurred in the world more than a dozen spontaneous combustion accident caused by battery defects. September 2nd, Samsung Electronics announced that due to battery defects, recalling 2 million 500 thousand of its production of Note 7 smartphone. But things did not subside, with the subsequent spate of accidents, the outside world gradually lost confidence in Note 7.
Security concerns, the U.S. telecom operator AT&T, T-Mobile announced yesterday to stop the new Note 7, and suggested that the user to replace other brands or models of mobile phones or even refunds. Subsequently, the country's largest telecom operator Verizon also made this decision.
Although the Sprint has not yet been given a statement, but the official page of the Note7 also showed that the whole line is not available. Currently, in addition to the four operators in the United States, Telstra has also suspended the replacement of Note sales, which urged Samsung to make a reasonable commitment to security issues as soon as possible.
In this regard, following the previously announced recall, Samsung Electronics has a new action. According to Yonhap quoted Yonhap reported on October 10th, Samsung Electronics announced the suspension of Note 7 production, the main purpose is to ensure product safety.
Affected by the event, as of noon yesterday, Samsung shares fell 3.22%, at 1 million 651 thousand won, compared to the previous day's closing price of 1 million 706 thousand yuan to calculate the won, less than a day, Samsung $6 billion 940 million market value evaporated.
Recall, sale, production, market value of Samsung evaporation, facing the biggest crisis in history, in addition to the high economic losses, so the most fear should be the brand reputation, market position, long established will be hit, but this loss is immeasurable in numbers.
Fall in the US market"In the United States, 95% of mobile phones are sold through telecom operators channels, they are mainly concentrated in Verizon, AT&T, Sprint and T-Mobile, Samsung mobile phones are also the same as the four.
According to Samsung Electronics recently released a report on sustainable development management in 2016, Samsung's sales in the United States up to $60 billion 200 million, accounting for about 34% of global revenue. The United States has been able to occupy 1/3 of Samsung's global sales, the most significant credit or Samsung Galaxy flagship smartphone in the local popularity.
Remember earlier this year, Samsung with Galaxy S7 and Galaxy S7 edge to win the attention of consumers, especially in the U.S. market, Samsung's new flagship is more popular.
Overseas research institutions show that as of 2016 March, Samsung accounted for 28.8% of total shipments of smart phones in the United States, ranked first place in the local market share.
On the one hand, thanks to the S7, on the other hand, although Apple has been sitting safely dominant from 2015 to April, but because of its iPhone sales decline, resulting in market share fell to 23%, ranked second in the United States, will hand over the leading position to samsung.
However, now Samsung is probably more likely than the first position. The United States four telecom operators in the has announced the sale of 7 of the Note, which will inevitably affect the sales volume of the market, but at present we do not see any effective measures to enable Samsung in the short term to resume sales of Note.
On the contrary, in the second row of the latest release of Apple's iPhone 7 in the U.S. market fared well before T-Mobile released a report, iPhone 7 and iPhone 7 Plus at the time of booking sales record, orders amounted to iPhone 6 4 times.
Obviously, the benchmark product Note 7 bombing scandal to some extent stimulated apple orders. Tencent technology has been investigated in the United States, after paying the user in the United States accounted for nearly 80% of the mobile phone market, this part of the user to choose Samsung, apple and other major brands flagship.
Because of the high cost of subsidies to operators after the market, or even up to 100%. In addition, the United States to improve the credit system, the user does not pay a high price to buy mobile phones. Now Note 7 suspension of sales by the operator, will undoubtedly increase the sales of iPhone 7, Apple will therefore be very likely to regain the first position in the market.
Analysis of HI investment securities company said citing, because Samsung Note mobile phone operators to recall 7, also began to promote the iPhone mobile phone, under the favorable factors stimulating, Apple will regain the high-end smart mobile phone market dominance.
Analysts pointed out that the Note 7 scandal more than a drag on the product line, in the absence of the sale of Europe and other markets, due to brand reputation caused sales decline, which ultimately affect the annual sales of samsung.
Who will fill it?
In addition to Apple's earnings, more affected low-end user groups and some high-end users, will be transferred to the domestic mobile phone manufacturers camp.
In the world's top ten smartphone manufacturers, Chinese companies have a total of 7. Note 7 is the high end of the original location of business people, and positioning similar domestic brands have HUAWEI Mate 8, Jin M6, ZTE secret 7. Under the influence of the brand reputation of the Samsung Galaxy C5/C7 low-end users will tend to vivo, OPPO, millet, music and other brands.
However, sales from the Chinese market, Samsung accounted for 20% from 2013 has fallen to less than 10%. According to Shiner released data show that in 2015 4G mobile phone market China total sales of 291 million, of which sales of 22 million 425 thousand samsung.
Tencent science and technology learned from the retail channels, the Chinese market Note 7 stocking quantity is very small, after the scandal came out Note sales volume has been declining, the current day shipments less than one hundred units of 7. Part of the channel has no inventory, Samsung has not supplied.
The analysts pointed out that if China market decline the impact on Samsung is limited, the focus is the overseas market, so domestic brands in overseas markets, especially in the high-end market against Samsung only HUAWEI for HUAWEI, so this is a rising share opportunity.
Last year, HUAWEI sold 108 million smartphones, which is far behind Samsung's 324 million and Apple's 231 million, but the gap is narrowing rapidly. This year, HUAWEI's sales curve will become steeper: the first quarter sales of 28 million 800 thousand, an increase of 10 million, while the same period in the same period of Samsung, Apple has declined.
From the beginning of last year, Samsung's share of sales in Europe fell steadily, is gradually shrinking its layout in the European market. Data show that in the European market (including the CIS Russian Federation), Samsung's sales accounted for only 19% of global business last year, compared with 2013, in 2014 and 21% of the more significant decline in 23%.
Samsung is not very important in the European market of intelligent mobile phone sales, released last year, cross-border flagship Galaxy Note 5 still decided not to go on sale in Europe, perhaps Samsung after investigation, that the local demand can not meet expectations, so choose to give up. The HUAWEI Mate 7 from the start, and then to last year's Mate 8, this year's P9 has successfully opened the European market, it is not difficult to foresee, after the Samsung Note scandal, HUAWEI's most promising diversion of Samsung in the European market, such as the user of the. It is reported that HUAWEI Mate 9 has been identified in November released.
HUAWEI's consumer business CEO Yu Chengdong has said that HUAWEI's goal is to exceed Samsung Electronics and apple in five years, becoming the world's largest smartphone maker with a market share of more than 25%. However, in the hottest U.S. market, HUAWEI mobile phone share less than 1%.
Note 7 scandal will continue for a long time is still unknown, but Samsung's heavy losses will make the world's dominant smartphone no longer scenery. Volkswagen exhaust scandal, CEO winter Cohen resigned last year. In Note 7, to be just nominated for the Samsung Group Executive Director of the "crown prince", Mr Lee, is a test of leadership.

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