Is Samsung loosing its Steam?

With Apple about to start a program whereby users will be able to trade up to the new iPhone 5 by turning in their older iPhone devices (details coming soon), Reuters reports that "....Samsung Electronics Co lost $12 billion in market value on Friday, hit by brokerage downgrades that have underscored concerns about slowing sales of its flagship Galaxy S4 smartphone." 


Worries are that shares slid given the introduction of two variants of the same, namely the Samsung mini S4 and the Samsung S4 Active.  Perhaps watering down the impact of the popular Galaxy S4, whose sales have attenuated after a great launch. Reuters reported that KimYoung-chan, an analyst at Shinhan Investment Corporation said that "Sales of high-end handsets are lagging behind expectations, while low- to mid-end handsets are selling briskly worldwide... As the portion of low- to mid-range handsets is expected to increase in Samsung's overall mobile phone business, this has also sparked concerns about thinning margins and lower growth."

So, what does that mean to the consumer?  Well, when there are options and gimmicks move consumers less and less, it would be safe to say that consumers start capitalizing on the cost to value ratio, giving them greater leverage due to supply and demand forces.  The greater the demand the higher the price.  So, as the demand for higher end phones falls behind, so should the prices, giving you and me, the consumer, the opportunity to buy lower and keep more money in our pockets. 

As for Samsung loosing its steam, I would not be too worried about them at this time.  They have the resources to pump out plenty of well equipped low-to mid range phones devices at competitive prices.  Don't forget that just 5 years ago, T-Mobile's flagship device was the HTC G1 followed by the upgraded Motorola Cliq.  Compare the specs of those phones with today's newest "starter" devices and they are worlds apart.

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