Is Samsung Looking At Social Media Innovation To Boost Its Mobile Phone Revenues?

SSNLF: Samsung Electronics logo
SSNLF
Samsung Electronics

Samsung Electronics (OTC:SSNLF)  recently announced that it will showcase three previously secret projects at this year’s South by Southwest (SXSW) festival. All three are from C-Lab, the  innovation program the company operates to help its employees to nurture their own creative business ideas. The first is Waffle, an innovative social media platform that is designed to enable collaborative content creation on smartphones.   The second is  Hum On!, a mobile app that notates and plays back hummed melodies in a range of instrumentation.  And the third is Entrim  4D,  a virtual reality headset that  allows users too sense and feel a motion as actions are seen and heard.  The company aims to gather feedback and assess the market potential of these products by showcasing them at SXSW. For Samsung’s mobile phone division, in particular, these new products offer the potential to increase market traction against competing platforms.  Across its consumer offering, Samsung is using innovative software and hardware designs to boost potential growth.

Social Media Apps Most Popular On Smartphones

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According to ComScore, Facebook and Facebook messenger are the two most popular apps on smartphones, indicating that a high number of users use their smartphones for social media access.   Another ComScore report reveals that social media consumption on the go has become a necessity for most people; in fact, 57% of Americans use dedicated social media apps to interact.  We believe Samsung is looking at innovative ways to tap into this trend by providing a differentiated social platform which could boost its mobile phone sales.

Samsung believes that all social media platforms currently available share a common limitation in terms of allowing only one user to individually publish content. With Waffle, Samsung aims to change that with a user interface that resembles a grid and allows users to add to existing related content.  Users can add images or text to an existing image shared by another user creating a collaborative story. Waffle’s differentiator is its ability to allow users to add perspective to someone else’s content which will converge into entirely new content.

The mobile phone division accounts for more than 25% of Samsung’s valuation according to our estimates and we expect its market share in this segment to decline from nearly 20% in 2016 to around 17% by 2019 and stabilize thereafter by the end of our forecast period.

 

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