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Samsung Rising

Samsung Rising

Apple's iPhone is still a profit machine, but Samsung's smartphone business is quickly growing. It leads Apple in smartphone sales, according to various estimates, though the iPhone maker is hot on its heels. Elsewhere, the two continue to battle IP litigation wars, with a top-level settlement meeting scheduled for this month.

By Rachelle Dragani MacNewsWorld ECT News Network
05/02/12 5:00 AM PT

Apple revealed its latest quarterly earnings statement a week ago, and it was another period of strong sales for the company. That was thanks in part to customers in emerging markets buying iPhones.

One report from Deutsche Bank this week said that Apple could sell as many as 25 million iPhones in China this year and could have 35 million iPhones there by 2013. That's not outside the realm of possibility, especially if Apple signs with China Mobile, the country's largest provider, Michael Stanat, global research executive at SIS International Research, told MacNewsWorld.

Then, he said, Apple will be viewed as less of a luxury good and more of a working product for a larger segment of the population.

"China Mobile is important strategically if it wants to grow and expand in China to become more mainstream," Stanat said. "While Apple has strong branding and customer experience, low-cost local producers continue to provide competitive threats to Apple."

Apple didn't respond to our requests for comment.

Samsung Takes the Smartphone Crown

The iPhone may be gaining ground in China, but a report from IDC on Tuesday showed that Samsung is ahead of Apple as the world's top smartphone maker. During the first three months of 2012, Samsung shipped 42.2 million smartphone units, a 267 percent increase from 11.5 million during the same time a year earlier. That was enough to take the crown as the world's top mobile phone vendor away from previous leader Nokia.

Apple was no slouch, though. As the company reported in its recent earnings report, it shipped 35.1 million iPhones during the first quarter of 2012, an 88.7 percent increase from the year before. IDC said the sales numbers indicated strong year-over-year growth and said its increased availability worldwide gave it a boost.

Another report from Juniper Research released Tuesday is a reminder that Apple isn't about to concede its place as an industry leader. The company brought in $22.7 billion in the first quarter with its one phone line -- the iPhone -- while Samsung received $17 billion from its entire division of smartphones.

Samsung Also Attacks on Patent Front

The smartphone makers aren't only dueling in a sales race for mobile phones -- they're also engaged in an intense battle over intellectual property. Each company is alleging that the other infringes on certain patents and are fighting for injunctions worldwide.

Earlier in the month, as part of a lawsuit in a San Jose court, the competitors agreed to settlement talks that will involve both companies' chief executives. Magistrate Judge Joseph Spero will oversee. This week, FOSSpatents announced that the talks between the two companies are scheduled for May 21 and 22 in a San Francisco courthouse.

The decision to have the company's captains discuss the matter face to face isn't unprecedented, said Raymond Van Dyke, a Washington, D.C.-based technology attorney and consultant. But especially as the news comes out that Samsung is winning in a smartphone race, it's unlikely the talks will bring a painless resolution, he said.

"It is unlikely that the meeting will resolve this dispute," he told MacNewsWorld. "With the enormous stakes [in] the smartphone market, it would be unusual for the sides to settle merely because of the CEO meeting. Nonetheless, the judge is savvy enough to realize the meeting may be the catalyst for a real settlement."


Rachelle Dragani is a freelance reporter based in Brooklyn, NY. She enjoys staying on top of e-commerce deals, reporting on what new gadget is coming your way, and keeping tabs on anyone trying to hack into your info. Feel free to e-mail her at rachelle.dragani@newsroom.ectnews.com.


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