BEST OF THE WEB: How Samsung is winning the smartphone war

It’s typical to think of Apple as the smartphone king. The iPhone has become one of the best-selling devices of all time, and its fat profit margin has made it the biggest tech company in the world.

But the company’s rival, Samsung, is not only doing well for itself, it’s catching up. The Galaxy is now one of the best-selling smartphones and is even outpacing the iPhone in some markets. Samsung Electronics is so huge it contributes 17% of South Korea’s GDP.

What happened?

Over at BusinessWeek, there is a detailed profile of the company and how it’s managing to mount a significant challenge to the existing market. It’s becoming, as the piece describes, the “anti-Apple”.

Samsung is probably the only other company that can throw a product introduction and have people line up around a city block, as they did in New York City on March 14 for the launch of the Galaxy S 4.

So while Samsung has been around for a while making refrigerators and washing machines, it is its smartphone line-up that is delivering the goods. Or, more specifically, the profits.

But as the piece describes, the company’s reach can be felt no better than in its own country, where a Seoul resident would have encountered its products daily.

Its strategy is simple. Start creating components for new industries, and then sell those components to bigger companies. Then, when the business decides to expand, it creates a position that few other companies can match.

“Last year, Samsung Electronics devoted $21.5 billion to capital expenditures, more than twice what Apple spent in the same period,” the piece points out.

Back in 1991, Samsung started making LCD panels, and in 1994, flash memory. Two components key to the smartphone revolution Apple loves to mention again and again.

Samsung is now the only company that can mount a challenge to Apple’s smartphone dominance. If you’re curious how it’s been able to do so, then this piece is for you.

Bitcoin’s second coming

If you’ve been paying attention to the European financial situation over the past few weeks, you would have noticed the Cyprus government being met with contempt after announcing a particularly painful austerity plan.

What you might not have noticed is that in the days following the controversy, the value of Bitcoins – a digital currency – have risen from about $US45 to $US115.

Bitcoins are an odd invention. The creator of this digital currency is long gone – and no one is even sure who he actually is. The currency works by using computer power to “mine” coins with an algorithm. But the currency is exponential. The more bitcoins are made, the longer it takes to mine them. Four years ago anyone could mine them. Now, you need dedicated, expensive hardware running 24/7. Just like gold mining.

It’s clever, but also weak. Hacking attempts during the past two years have exposed its vulnerability. Until recently, Bitcoins had left the headlines as nothing more than an experiment that brought some early investors success.

Now, however, Bitcoins are gaining value as an alternative to the shaky global financial system. And as this New Yorker piece explores, many are viewing them as a viable alternative.

Contrary to hysterical media reports, such as this recent video from the Guardian, the Bitcoin-software community is loosely governed not by wild-eyed kids camping out in half-deserted lofts but by what appears to be a rational and sober group of adult administrators who run the Bitcoin Foundation.

This organization was modelled on the Linux Foundation, according to Gavin Andresen, who is currently the Bitcoin Foundation’s chief scientist. As the lead developer for the project, Andresen is paid a salary by the Bitcoin Foundation.

Bitcoins are slowly becoming a serious subject. While it certainly isn’t clear whether it will become anything more than a gimmick, the piece is a good read about what could become the world’s next major currency development.

Retailers are using online databases to catch shoplifters

Shoplifting is always a problem. But retailers in the United States are now tackling the issue in a curious way – by collecting databases of suspects.

According to this piece at The New York Times, the databases have members including major retailers such as Target and CVS. The problem, though, is that many people don’t even know they’re on the databases in the first place. Lawyers suggest they’re being coerced into confessions, even when they’ve done nothing wrong.

As the economic recovery limps forward, consumer lawyers say, the consequences of the retail theft databases can be particularly devastating. With so many job applicants, employers have little incentive to hire someone with a tarnished background.

Although shoplifting is definitely a problem, this may not be the best way to fix it. If you’re in the retail industry, this is definitely worth a read.


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