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Why every rival tech company should be scared to death of Samsung

February 26th, 2013 at 10:15 AM
Samsung Strategy Analysis

One thing has become very clear at this year’s Mobile World Congress: Samsung (005930) is not satisfied with only being the world’s top Android vendor. This was made clear by the company’s announcement that it would be making a major push into the enterprise world with the launch of its KNOX enterprise security suite. And the scary thing is that Samsung doesn’t just see itself as an enterprise smartphone company but as a comprehensive enterprise technology company capable of meeting a wide range of needs for businesses.

As Tim Wagner, Samsung’s vice president and general manager of enterprise sales, told me earlier this week, “no one out there has the portfolio we do not just for smartphones, but in printers, laptops and tablets.”

Why is this proposition so daunting for a lot of rival tech companies? Because Apple (AAPL), for all its massive success over the past decade, never made a concerted effort to become a business tech company. Sure, Apple was happy to have its products in the enterprise but it was more interested in getting consumers to do their work for them: In other words, Apple thought that being popular with consumers would thrust its products into the workplace and force companies to adjust accordingly.

Samsung’s new approach is markedly different. Its Galaxy-branded devices are already popular with consumers and now it’s offering companies a sizable set of security services aimed at easing their anxiety with consumers who bring Android devices into the workplace.

BlackBerry (BBRY) will protest, with much merit, that it is vastly more experienced in the security realm and that it offers significantly more enforceable security policies and a more finely grained security product overall. But the downside for BlackBerry is that the merits of its argument might not matter — Samsung at this point is a very well-oiled machine with an enormous budget to spend on both its marketing and its sales force. If the company is determined to take BlackBerry’s place as the go-to enterprise mobility company, there is very little BlackBerry can do to stop it.

And BlackBerry is only one prospective snack on Samsung’s menu.

The fact that Samsung is naming its own version of Android “Security Enhanced Android” has the unwelcome implication for Google (GOOG) that other versions of Android aren’t secure. The company this week also made sure to emphasize its new tablets’ prowess for gaming, for education and for retail sales, which hints that the company is planning to make big pushes with business applications into specific industries that are used to using Windows or Apple (AAPL) devices to get their work done.

This explains why Apple is moving as fast as it can to dump Samsung as a supplier and why Google is working with Motorola on its own “X Phone” aimed at cutting Samsung’s power in the Android ecosystem: Both companies are too smart to keep feeding the beast that plans to devour them.[bgr-post-bug]

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