New Samsung Galaxy S4? Meh.
By Cyrus Sanati, contributor
FORTUNE -- Samsung's splashy launch party for its fourth-generation Galaxy S mobile device isn't going have much of an impact in its war with Apple. That's because the battleground for dominance in the mobile space has shifted away from the hardware and physical design of phones and toward their software, specifically the operating system. The real battle for mobile dominance looks like this: Apple, with its iOS ecosystem, is in one corner and Google, with its Android system, is in the other. Whichever wins over consumers will ultimately decide the victory.
The launch of the new Galaxy S4 in New York this week has the tech media churning out post after post examining how this new phone could impact the mobile phone space in the US. But all this digital ink isn't necessarily being spilled because the public is excited about the launch of yet another mobile phone. No, this is all about Apple (AAPL). Specifically, how this new phone will stack up to Apple's latest iteration of the iPhone, the iPhone 5.
But I don't expect to be wowed when the new device is finally in hand. That's because the new Galaxy doesn't have much we haven't seen before on a mobile device. It features a 5-inch, high-definition screen that can be used while wearing gloves. Thin and light, it packs 2GB RAM and will come with a 1.6GHz Exynos Octa-core chip or a 1.9GHz quad-core Qualcomm, depending on the region in which it is being sold. The phone can pull off a few neat software tricks—like translating spoken language.
And yet, real innovation in smartphones seems to have hit a plateau. Take a phone's camera: The iPhone 5 has an eight-megapixel camera while the new Galaxy S4 has a 13-megapixel camera. To that I say: whoopee, big deal. Anything above five or six megapixels is basically wasted on the vast majority of people who are just interested in getting a clear enough picture of their dinner or their friends to post on Facebook (FB). If anything, the larger pixel size is a negative as the pictures will eat up a lot more space on the phone's memory, leaving less space to store music, apps and the like.
The Galaxy S3 and other high-end phones like HTC's OneX+ or Sony's Xperia Z have already proven that they are as good as or even better than the iPhone. That isn't the issue. Samsung has clawed its way to the top of the high-end mobile market in the US, not by making a superior phone, but by spending buckets of money on advertising. The Korean giant spent a whopping $401 million in the US alone advertising it's cell phones in 2012, according to ad research and consulting firm Kantar Media. Apple spent $333 million. HTC, Sony (SNE) and Nokia (NKE) didn't spend much at all, reflecting their poor market share in the high-end mobile arena.
But there are diminishing returns when it comes to advertising. At some point Samsung will have to be able to woo a new customer over to its side by simply having a better all-around product. (Some argue vociferously that this is already the case.) But Samsung has a major issue here in that it doesn't have control of the most important parts of a phone, the operating system and the accompanying online media store.
Samsung relies on Google (GOOG), and to a lesser extent, Microsoft (MSFT), to provide the operating system on nearly all of its phones. This has allowed Samsung to save a lot on research and development (Google gives Android away for free), but it has also tied its hands when it comes to eliminating a major revenue stream of the mobile market—media sales. There is relatively high switching cost when a person goes from Google to another operating system, such as Apple's iOS. The time that needs to be invested in simply learning a new operating system is enough to make even the most tech savvy nerd sick. Apps bought on one system, though they are by the same company and do the same thing, aren't compatible between systems, meaning you have to buy them all again, a costly measure for many people.
"Android has a global partnership of over 60 manufacturers; more than 750 million devices have been activated globally; and 25 billion apps have now been downloaded from Google Play," Larry Page, Google's chief executive, wrote in a blog post this week. "Pretty extraordinary progress for a decade's work."
At last count around 70% of smartphones run on Android. That's a both a blessing and a curse for Samsung. On one hand it is great as the larger market share means that a lot of people are now familiar with how to use Android and have some sort of tie with the Google Play Store. But on the other hand, it also means that a customer could pick up a dozen of phones by an array of manufactures and basically walk away with the same experience as they would have with a Samsung device. (Naturally, Apple's closed system avoids this very problem.)
Samsung's lack of power designing the core software that runs on its flagship mobile device makes it tough to celebrate the launch of the S4—even if it can do a few new things. Copying hardware is not the game anymore; rather, it is more about who can build a long-standing, sticky relationship with customers after that initial sale is made. Apple and Google are basically the only two players in this new war– one in which Samsung, for the time being, can't even participate.
Positive Impressions of The New Samsung Galaxy S4
So the Galaxy S4 is finally launched, a phone that Samsung says moves us “beyond touch.” Observers are noting too that Samsung has put more emphasis on software innovations rather than hardware, though the hardware, particularly the screen, is impressive. Samsung calls it the “life companion”, for good reasons.
The general press reaction to the S4 is favorable but with nobody claiming this is a game changing phone or that it will obviously steal customers away from Apple. In fact the sense is that it is packed with features that will take months to explain to customers, which could be a drag on sales. I doubt it.
In the end commentary, focuses on the Apple vs Samsung battle. The Guardian says the Radio City launch venue is all about telling the world this phone is meant to close the gap between Apple and Samsung in Apple’s core, US market. There is a good reason for that other than Samsung’s competitive instincts.
In advanced markets like the USA most phone purchases are now really about replacement phones rather than first time purchases. For Samsung to close the gap on Apple, it has to take a growing share of Apple’s customer base when they come to replace their iPhones.
The real positive though is that Samsung is now focused on software. It needs to focus on services and in that respect the new health monitoring feature could be a way to capture long term customer loyalty.
In an important sense that means we are already moving beyond the smartphone into a broader lifestyle computing category that Apple and Samsung have the power to define. According to the Telegraph:
What we will see over the next six weeks is a wave of advertising from Samsung as it tries to sustain a buzz before the Galaxy S4 reaches shops in the UK and the US at the end of April. We won’t be any wiser on whether its new features can persuade consumers until the product is available. If it fails to capture the imagination of consumers, it may prompt Apple to accelerate efforts to develop a product that moves beyond the smartphone and the iPad.
The problem with smartphones is that their hardware features and looks are the principal factors that people share when they meet. It is difficult to share a software feature and harder still to excite enthusiasm among a group of friends about a service like health tracking.
In the auto industry, eco-cars were delayed for several years as designers sought ways to give expression to an eco-feature in the look and feel of the car. Phone makers have to find a way to give expression to advanced software and service features by adapting the smartphone slab. Samsung has not attempted to do this.
Luke Johnson says of the design, on Trusted Reviews:
….a near identical form to that of the S3, the Samsung Galaxy S4 is an inoffensive yet somewhat uninspiring affair with Samsung’s trademark plastic finish detracting slightly from what is otherwise a high-end, cream-of-the-crop device.
And of the screen:
With a stunning 1920 x 1080p Full HD resolution matched with an iPhone Retina display trumping 441 pixels-per-inch, the Samsung Galaxy S4 screen is a Super AMOLED HD marvel.
There are good bar room features like smart scroll – not exactly eye scroll. A tilt of the head encourages the screen to scroll up or down.
None of the S4’s hardware updates is what I would call revolutionary, but some software features are pretty cool, such as the handswipe gesture recognition, which enables users to move through web pages, change music tracks or answer an incoming call just by waving a hand a few centimetres in front of the screen.
That of course is precisely what fashionista smartphone users want. These are strong eye-candy specifications but I have to admit a preference for the health monitoring service, which few reviewers have pounced upon, suggesting that it will not be a strong sales proposition.
According to Tech Radar the S Health monitoring system is allied to a number of Samsung health peripherals like scales, and a sleep tracker.
The service is aimed at Nike’s Fuel Band and products like Fitbit. A lot depends on how far Samsung goes to develop a back-end service for these products but in principle this takes the smartphone deeper into lifestyle, it allies service to product and I believe could easily become an ecosystem in its own right as users share information and third party vendors develop for the health market.
Here Samsung is taking precisely the steps it should take to build deeper loyalty and additional revenues. It could be its smartest move yet, and the place where it can move beyond Apple.
Teardown of suspected Galaxy S4 appears on Web
Mere minutes before the expected official unveiling of the Galaxy S4, leaked images showing a meticulous teardown appear on the Web.
Appearing on the Chinese Web site It168.com, the detailed images show a meticulous teardown of the handset, which is expected to be unveiled this evening in New York. The source of the images appears to be the same person who leaked clear images last night of the assembled handset.
The gallery of images is an apparent confirmation of many of the rumors that have been circulating about Samsung's new flagship phone, including that it will be powered by the company's new 8-core Exynos 5 Octa processor (model number 5410). The device also appears to sport a 13-megapixel camera.
The handset is also expected to feature 2GB of RAM, a 2-megapixel front-facing camera, and the latest version of Android, known as 4.2.2 Jelly Bean, though those were details that could not immediately be confirmed from the images.
First Look: Introducing Samsung's Galaxy S4
phones. Of course, that means another dance number!
7:58 p.m.: And that's a wrap. Interestingly, no details on a launch date, compatible wireless carriers or price.
7:56 p.m.: The S4 will include built-in health software that can track heart rate, body fat or other fitness needs.
7:55 p.m.: Bidan talking about Smart Scroll and Pause, which automatically pauses video when you turn away, and restarts when you look back at the screen. Users can tilt the screen up or down to scroll through text. There's also a separate feature allowing users to answer the phone by waving their hand over the screen.
7:52 p.m.: Group Play also supports multiplayer games, which sounds very promising. Moving to ChatOn, which adds Video Chat for up to three people by using both the front and rear cameras. Users can also share screens.
7:50 p.m.: Shifting to Group Play, which allows users to share songs and play them on as many as eight other S4 phones. It looks like users can do this by simply tapping phones. Of course, that means another dance number!
7:48 p.m.: Bidan offering a peek at Samsung Hub, the S4's equivalent of iTunes before diving into Samsung Knox, security software built into the phone. The technology splits your phone into home and work spaces, and keeps them separate.
7:46 p.m.: Samsung demonstrating S Voice Drive, which is the S4's answer to Apple's Siri. Users can have the phone read emails back, and even reply or forward messages. In another demo, the host answers a call by simply saying "Answer."
7:44 p.m.: Bidan talks about switching content from older phones to the S4. Users can download Samsung Smart Switch to their PC to transfer contacts and other data easily from almost any phone to S4.
7:42 p.m.: Bidan discusses HomeSync, a home device that connects to the cloud for storage. It can hold up to 1 TB of data, and supports near field communication, so users can tap the S4 on the HomeSync to view their content.
7:40 p.m.: The S4 features Story Album, which lets users package photos into a dynamic album with text. Users can also create and send hard copies of the album. They will cost $10-$30 with shipping. Images can be displayed either in portrait and landscape modes.
7:38 p.m.: Another cool feature: Adapt Display. The screen will adjust brightness, saturation and other elements based on what you're viewing, whether it's video, email or a game.
737 p.m.: Samsung now showing off S Translator, which is amazing. One user speaks in English, and the phone translates and asks the question in Chinese. Another user responds in Chinese and the phone displays it in text form in English. Several languages are supported such as French, Spanish and Japanese, and it's integrated into other apps. More than 3,000 embedded "useful" sentences are available, says Bidan, in case you don't have a wireless connection.
7:34 p.m.: There's a reason for the dance routine: showing off Drama Shot. The camera can take up to 100 shots in four seconds, and creates a collage in one frame. There's also the very cool Eraser, which lets users delete bits of the background for a cleaner view.
7:32 p.m.: Now the Samsung messenger is tap dancing. Not making this up.
7:31 p.m.: The dual camera also works with photos, capturing one with each camera at the same time. Users can also add audio to images. Very interesting. The camera includes a variety of filters they can implement.
7:30 p.m.: And this is where the event turns into a Broadway presentation. They are in Radio City Music Hall, after all. Bidan breaking down the dual camera, where users can shoot videos with both cameras simultaneously. Wow.
7:27 p.m.: The S4 will come built with 16 GB of storage with options for 32 GB or 64 GB. It also includes a micro-SD slot for up to an extra 64 GB. It also includes a removable battery.
7:26 p.m.: S4 includes usual bells and whistles such as Wi-Fi and Bluetooth. The 4G network includes 100 Mbps download and 50 Mbps upload speeds. There's also very little surrounding that screen, which looks gorgeous. The main camera is 13 megapixel, while the front is 2 megapixel, says Bidan.
7:24 p.m.: Ryan Bidan of Samsung Marketing on stage to describe features. It's 5.3 inches long by 2.7 inches wide. Full 5-inch screen, full HD, super AMOLED screen.
7:21 p.m.: A slide on the big screen calls the S4 a "life companion." Shin says it's slimmer, lighter and more solid, and supports 3G and 4G.
7:19 p.m.: "For each of us, life is a journey," says Shin. "What we want is a device that can join us in our journey." Shin then confirms what we all expected: the Samsung Galaxy S4.
7:18 p.m.: Shin mentions Samsung Knox, which focuses on providing security for enterprise purposes. Also noted, HomeSync for "seamless" sharing between devices.
7:16 p.m.: Shin says focus of Samsung is to create a device that "helps us get closer to what matters in life," and to lead a life that's "richer and simpler." Shin hinting at touchless interfaces and the long-rumored eye tracking technology.
7:15 p.m.: Chase introduces Samsung's J.K. Shin, who will likely unveil the next Galaxy. "We are committed to innovation. We are always listening to what people want around the world," says Shin.
7:12 p.m.: Show starts with a video of a young boy carrying a mysterious box with the word "Unpacked," which happens to be the name of Samsung's event. Host Will Chase and "messenger" Jeremy Maxwell on stage.
7:11 p.m.: That YouTube stream is now up to 347,000. Lots of people interested in Samsung Galaxy. Lights have dimmed. Go time.
7:05 p.m.: And the announcer just said the show will begin in a few minutes.
7:03 p.m.: And for those wondering, I'm watching via live stream on YouTube, along with 272,000 (and climbing) of my closest friends. If you're on a Web browser, scroll down to watch with us.
7:00 p.m.: Between the music and presentation at Radio City Music Hall, can't tell if this is a tech event or the lead-up to the Oscars. Very Hollywood.
Update at 6:59 p.m. ET: The event is about to start in a minute. Let's see whether this is the Galaxy S IV that everyone has been speculating about.
Our original story
Samsung is hosting an event in New York where it is widely expected the company will unveil its latest Galaxy S smartphone.
USA TODAY's live coverage of the announcement starts up at 7 p.m. ET. Samsung is also broadcasting via YouTube livestream.