Apple and Samsung are now the key manufacturers of high-tech consumer electronics. They are also adversaries in a new generation of patent wars. At present, their conflict is mainly happening in the sphere of mobile phones, where both companies are waging relentless wars with global impact. In order to compare both companies it is necessary to study the origins of their existence and the principles of their nature.
Samsung is the largest mobile phone manufacturer, is one of the main suppliers of chips, displays and other small components, and is also a key player in the current patent wars on a mobile platform. However, South Korea is far away, and in Samsung they’re talking a different language and little is known about Samsung. On the contrary, it cannot be said about Apple, whose history and the charismatic Steve Jobs have written dozens of books and at the end of the 90s was shot and successful TV movie Pirates of Silicon Valley. As mentioned above, Apple Mythology knows almost everyone. In the ’70s they came together minded Steve Jobs and Wozniak in the garage and put together the first cheap computer. Then they approached geeky, then the general public and in the 80s became a fait sensation. Jobs after he left Apple and Microsoft competing company steamrollered open platform PC. In 1997, Steve Jobs returned, he put the company back on its feet and started its current award-winning era.
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Samsung, on the other hand, comes from a different background. The company was founded by Lee Byung-Chullo in the 30s of the last century. Samsung initially only dealt with sale of consumer goods and production of noodles. Later it began to grow and now consists of the entire conglomerate pile subsidiaries. The company got interested in electronics in the ’60s. In South Korea, Samsung now dominates almost everything. People go to the bank, the insurance with the insurance companies, buying its electronics, its machines, visit its hospitals and oil in the country is brought by its tankers.
While Apple company actually got its name after Apple, Steve Jobs is a Californian thinker moonlighted in an apple orchard. Then he apparently realized that his company would need to have a unique name, and Apple eventually prevailed. Everyone knows the name and the company is well promoted. Samsung on the other hand can be translated as “three stars”. Number three according to the founder Lee means eternity. While Apple was created in a small city of Cupertino, Apple offices are not remarkable. Samsung on the other hand is housed in the Seoul business district, which is called today a Samsung town.
Samsung is the largest manufacturer of mobile phones and consumer electronics. It reigns among the largest manufacturers of all kinds of chips, displays and other small high-tech components, manufactures hard drives, TVs, washing machines, chemical tankers, ferries, all kinds of machines and engines, owns banks, insurance companies, credit card companies, has interests in mining companies, automakers, and the corporate daughter, Samsung C & T Corporation is one of the largest construction company, which is responsible for the realization of world’s tallest skyscraper such as Burj Khalifa, Taipei 101, or even the Petronas Twin Towers in Kuala Lumpur.
Apple on the other hand has 60,000 employees, annual turnover of $ 108 billion, net income of nearly $ 26 billion (all for fiscal year 2013). Its shares are traded on the US technology stock exchange Nasdaq. Samsung, on the other hand is a bigger company, with its 344,000 employees, annual turnover of $ 247 billion, net profit of over 18 billion dollars. Its shares are traded mainly on the South Korean stock market (Wolsey,2014) .
Steve Jobs and Steve Wozniak were themselves trademarks valid worldwide. Thanks to the power of Apple’s media but today we are very familiar and current boss Tim Cook. The founder of Samsung, Mr. Lee Byung-Chullo is however for most Europeans completely unknown name in Korea, which is associated with the boom in the country after the Korean War. Apple company is one of those who created the dream of the modern “garage startup” which arose from virtually nothing and for a few dollars. Apple’s driving force is to specialize in a certain type of goods. Apple does not sell socks, or do not build power plants, but sticks to its craft with exclusive margins. It is not a company with a history of many generations, but modern and efficient computer company with excellent turnover / profit. As Eric Taub in the New York Times Room for debate argued in 2005 that it is actually the capacity of evolution of already created brands which is one of the reasons for the success of Apple, rather than generating new generations of products. The problem, according to Taub is the demanding capacity of reinvention. Samsung in contrast, is a multifaceted factory of the twentieth century. Over the decades, it actually turn up, transformed and changed, but people do not know the company because of noodles, but thanks to consumer electronics. Its power therefore lies in the huge scope of its business and economies of scale. If something fails, it simply start producing something completely different – like a locomotive. Andrew Pollack in the New York Times section of Room for Debate mentions the decision of Samsung to enter the chip production business (1992). The synergy of this entry is likely to promote economies of scale but on the other hand create more complexities in Samsung, unlike in Apple.
There are however weaknesses to Apple model. John Markoff mentions Paul Mercer, a software designer who left Apple for Samsung and thus could put in danger the secrets of the corporate design of the company (NYtimes, 2006). Markoff argues that the focus on lean staff and small group of creators may be hurting the company. David Pogue argues in a similar tone in New York Times Room for Debate in 2006, that actually the brains are being drawn to Samsung, thus causing large damage to the Apple intellectual property, as it was seen in the case of iPod Nano, which although created by Apple was produced in a transformed form by Samsung. A year before, in the same media, David Pogue discussed the abovementioned iPod Nano, wondering on the capacity of Apple to generation innovation.
It is rather difficult to provide a well-focused comparison between the two brands as both come from different environments and both have a different philosophy. If we however, had to focus on the quality and the faithfulness of the company towards the client, it would be Apple, who would be a clear winner. Apple does target quality, originality, relationship with the client rather than wholesale volumes. For this reason, this company is likely to stay focused on its original aims, which cannot be said about Samsung (Waldner, 1992).
Summary
Eric Taub in the New York Times Room for debate argued in 2005 that it is actually the capacity of evolution of already created brands which is one of the reasons for the success of Apple, rather than generating new generations of products. The problem, according to Taub is the demanding capacity of reinvention. Samsung in contrast, is a multifaceted factory of the twentieth century.
Andrew Pollack in the New York Times section of Room for Debate mentions the decision of Samsung to enter the chip production business (1992). The synergy of this entry is likely to promote economies of scale but on the other hand create more complexities in Samsung, unlike in Apple.
John Markoff mentions Paul Mercer, a software designer who left Apple for Samsung and thus could put in danger the secrets of the corporate design of the company (NYtimes, 2006). Markoff argues that the focus on lean staff and small group of creators may be hurting the company.
David Pogue argues in a similar tone in New York Times Room for Debate in 2006, that actually the brains are being drawn to Samsung, thus causing large damage to the Apple intellectual property, as it was seen in the case of iPod Nano, which although created by Apple was produced in a transformed form by Samsung. A year before, in the same media, David Pogue discussed the abovementioned iPod Nano, wondering on the capacity of Apple to generation innovation.
Paul Mercer argues that Despite Samsung and Apple Inc. Exhibiting massive differences in their products, they have all succeeded in reaching a big point in the global marketing perspective. These two companies dominate the smartphone industry, and the instruction of smart watches by both companies is one of the manifestations of their competitive abilities in the global marketing scale. Therefore, both companies have their entry strategies in getting the attention of their customer base. His argument fails to give a clear distinction on the preferences among the two companies
- Waldner, J. (1992). “CIM: Principles of Computer Integrated Manufacturing”. Chichester: John Wiley & Sons Ltd.
- Wolsey, L. (2014). Production Planning by Mixed Integer Programming. Springer.
