One of the big talking points of this year’s IFA event in Berlin was Samsung’s Unpacked event in which Samsung launched their new flagship device the Note 4. There was not really any surprise factor with the Note 4 as a lot of the specs had been leaked prior to IFA and overall were rather accurate. However, what was interesting was Samsung launched two Note 4 variants, the standard Note 4 and the Note Edge. Although the specs differed slightly between the two devices the main difference was the Edge contains a curved screen which allowed users to see basic notification icons on the side of the device. This was a surprise and did highlight Samsung’s commitment to innovation and creativity.
Although the devices were unveiled at the start of September neither device will be available to purchase until October (early November for the Edge). Initial expectations were the Note 4 would be a good seller in the run-up to Christmas however it now seems South Korean analysts don’t think this will be the case. According to Yonhap news who quotes Park Young-joo (Hyundai Securities analyst) the Note 4 is only expected to ship 11 million units before the year end “1.5 million units in the third quarter, 9.5 million units in the fourth”. Now, to you and me 11 million units might sound a lot and to be honest it is a fair few. However, the number of units does not show an improvement from the number of Note 3’s which shipped last year. With a lack of increase in units sold for a ‘newer’ and more evolved device this figure will be disappointing to Samsung. What will probably be even more troubling for Samsung is the same analysts predict only one million Note Edge units will ship before the year end. With the Edge being the surprise unit and the height of innovation, Samsung would certainly have hoped for a better turnaround. One of the reasons the analysts give for the lack of Edge sells is ironically its unique design. The Hyundai Securities analysts suggest the manufacturing of the devices is expected to be “complicated”. This sentiment was also echoed by Ryan Hong (LIG Investment & Securities analyst) “it is unlikely the product will be mass-produced due to technological difficulties”.
Other South Korean analysts also actively attributed the predicted lack of sales for the Edge directly due to the function of the device. Yoo Eui-hyung, (Dongbu Securities Analyst) suggests the actual unit does not function as well as expected “The touch screen on the edge does not work smoothly”. Also adding “Users may well have difficulty adapting, which contradicts the model’s effort to strengthen convenience”. As a result, the South Korean analysts further predict Samsung’s profits will be affected by the lack of expected Note 4 sales coupled with the general rising of the company’s marketing costs and the need to shift its current stock of its previous flagship device the Galaxy S5. Whether sales are as low as the analysts predict only time will tell. Either way it is not looking too good for Samsung at the moment. What do you think? Will the Note 4 and Note Edge underperform in terms of sales? Will you be buying one?