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The iPhone Effect: A Disaster for Samsung

03/09/2010

Apple has released its blockbuster mobile phone in 2008, called the iPhone. iPhone provided customers with a totally new experience. The thing that was so special about iPhone was the application system. Apple developed its own Application store which is made for iPhone users. It was a whole new market where any people can create an application and publish to the world. Millions of creative applications were developed through the program and it couldn’t have been better for the iPhone users. Now they could have read books, schedule things, surf in the internet, or play games.

Not only that iPhone has created an innovative application market, it also was very very cheap. Before iPhone was in S. Korea, all the smart phones or touch phones were always over $600 and sometimes over $800. However, iPhone made a contract with the telecom companies and provided iPhone at about $200. In some cases, people could have got the phone for free. This made Samsung and LG inevitably lower their prices to prevent iPhone prevailing in the Korean mobile phone market.

Nonetheless, even with the low price, Samsung and LG still couldn’t help attracting more customers, because they didn’t have any application store developed. Korean phones did not even provide wi-fi because they wanted customers to use the connection that requires them to pay. This happened mostly all over the world that original cell phone companies fell in great shock. Thus, leading cellphone companies such as Nokia, Motorala, Samsung, LG, etc all gathered up in the MWC (Mobile World Congress) and decided to make a huge app store that all the phones from them can have access to. Because those companies did not have sufficient customers to enhance their ‘own’ application store, the companies decided to make a large, humungous app store, hoping they will someday outnumber the apps made for iPhone. The development of the large app store is not yet moved in to action, but if it does, the future of the global mobile phone market is unpredictable.

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