Galaxy Note 7: Samsung looks for continued momentum
By Gerrit Schneemann, Senior Analyst, IHS Technology
Jusy Hong, Principal Analyst, IHS Technology
Wayne Lam, Principal Analyst, IHS Technology
- The Note7 demonstrates Samsung's desire to be a technology leader in smartphones.
- IHS expects the Note7 to act as a premium showcase which will improve Samsung margins, define how Samsung's strategy differs from Apple and Huawei, and increase the appeal of Samsung's brand.
- The halo effect will boost volumes for cheaper models in Samsung's range.
- The expansion of the edge screen is important for Samsung’s relationship to developers. By broadening the reach of the edge screen beyond the Galaxy S6 and S7 devices, Samsung can make a better case for developer support of its user interface platforms – a key avenue for differentiation.
Samsung’s latest Note device, the Galaxy Note 7, is the company’s new flagship device. With it, Samsung hopes to capitalize on the momentum gained earlier in the year with the launch of the Galaxy S 7/edge devices. Pricing will depend on the carrier and availability will begin from August 19th.
The stylus-based Note series is a smartphone category which Samsung invented in 2011 and continues to lead. Neither of Samsung's closest rivals offer a large screen stylus-based smartphone. The Note is Samsung's most highly differentiated smartphone model.
Samsung just released its latest financial results and cited, in part, the earlier launch of the Galaxy S7 devices as the reason for its improved performance. The Mobile division which includes the handset business unit recorded 26.07 trillion KRW in revenue. Operating profit of the IM (IT and Mobile) group recorded 4.32 trillion KRW, resulting in an operating margin of 16.3%, the highest operating margin since Q3 2014.
Samsung is hoping to repeat the successful “early release” strategy going into the second half of 2016 with the launch of the Note 7 in August. In years’ past, Samsung has announced the next Note device in September.
The Note 7 is a premium device. To justify the asking price, Samsung is not only adding the latest hardware features to the device, like Iris scanner or USB-C connectivity, the company is also iterating the stylus’ capabilities of the device and is adding a new software user interface.
With the Iris scanner, Samsung is integrating a new technology to create a “wow” moment, since fingerprint scanners are now widely available on many devices, in many price ranges. Another new feature to position the Note 7 as the premium flagship device is the dual-curved screen. Since Samsung has seen success with its dual-curved screens on the Galaxy S6 edge/Plus and Galaxy S7 edge, the company is integrating the feature into its premium device, eliminating the need for another handset model.
Samsung is unifying its market roll out strategy globally: the new Note will launch in Europe, when last years’ model saw fragmented availability because of the Galaxy S6 edge Plus.
Samsung continues to evolve and enhance the user interface of its devices. For the new Note, the company is introducing more use cases for the S Pen, like Google Translate while hovering over text. Samsung needs to keep improving existing features while layering new ones on top to differentiate the latest S Pen generation from those on previous devices.
Samsung is also expanding the reach of its “Edge user interface,” previously only found on edge screen devices like the Galaxy S6 edge/Plus and S7 edge. This is important from the user perspective, because it adds another unique user interface to the high end device. The Edge interface is a place with which to tie users into a Samsung experience, not an Android experience on a Samsung handset. The edge screen is a unique feature and should receive as much attention in the development process to highlight its usefulness to the end user.
The expansion of the edge screen is also important for Samsung’s relationship to developers. There are now many Samsung platforms available for developers, including its wearable devices. By broadening the reach of the edge screen beyond the Galaxy S6 and S7 devices, Samsung can make a better case for developer support of its user interface platforms – a key avenue for differentiation.
Continue to lead
The Note7 demonstrates Samsung's desire to be a technology leader in smartphones. It includes all of Samsung's latest technologies, including speedy eye-based phone unlocking, edge display interface, innovative hover stylus, and adds new uses for the always on display enabled by Samsung's AMOLED screen technology. Impressively, Samsung includes all of the new innovations, as well as IP68 water/dust resistance, in a design which is more compact than older Note models.
IHS expects the Note7 to act as a premium showcase which will improve Samsung margins, define how Samsung's strategy differs from Apple and Huawei, and increase the appeal of Samsung's brand. The halo effect will boost volumes for cheaper models in Samsung's range.
- 5.7 inch Quad HD, dual edge Super AMOLED display with 2560x1440 resolution.
- Octo core 64 bit processor
- 12 megapixel rear facing camera with f1.7 and OIS, 5 megapixel front facing camera.
- 4GB LDDR4 RAM
- 64GB UFS 2.0 storage
- 3500 mAh battery
- Android 6.0.1
- Bluetooth 4.2 LE
- Iris scanner
- IP68 water resistance