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Samsung will make less phones to make more money in 2015

Samsung’s shotgun approach to making smartphones looks to be coming to an end, or at least a slowdown, with reports that the South Korean company will release anywhere from 25% – 30% less smartphone models next year than it did in the last 12 months.

Times are tough at Samsung as the South Korean company faces stiff competition in almost every price segment of the mobile phone market which is the main profit driver for the electronics giant. With Apple’s latest large-screened smartphone duo, the iPhone 6 and the iPhone 6 Plus, putting pressure on Samsung’s Galaxy S5 and Galaxy Note 4 at the top end of the smartphone market and China-based competition, from upstarts like Xiaomi and giants like Lenovo, hitting Samsung’s lower end smartphones with razor thin margins.

Samsung sits in an interesting place when compared to many other manufacturers because of its manufacturing prowess. It allows Samsung to put everything from processors, RAM and storage to its Super AMOLED displays into a variety of smartphones maximising the profit on every smartphone. That results in much greater profit losses for Samsung when its smartphones stop selling in the numbers it was expecting.

By decreasing the models it offers Samsung will be looking to “increase the number of components shared across mid- to low-end models, so that we (they) can further leverage economies of scale” and hopefully start moving their fortunes in a more positive direction.

So get ready for a 2015 with less smartphones names that sound like Samsung Galaxy (insert verb or adjective here).

[Source – WSJ, Via – Engadget]

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