Samsung Electronics (OTCMKTS:SSNLF) has been in the news for all the wrong reasons. On Sunday, the company confirmed how it’s going to fight back by launching its own digital assistant with the Galaxy S8, Viv.
Viv Aims to Change the Samsung Narrative
Samsung has had a terrible year. Things started out well with the Galaxy S7 and Galaxy S7 Edge. The Galaxy Note 7 scored excellent initial reviews, but quickly turned into an epic PR nightmare. Exploding Note 7’s led to a recall of the devices, and mounting costs that could hit $17 billion.
Even as this crisis simmered, the company was forced to recall millions of washing machines, amid concerns they could vibrate to the point of shaking themselves apart.
So far, all of this mess hasn’t crippled the value of Samsung stock, but the cumulative impact is not helping. And it doesn’t bode well for the future.
Samsung desperately needs a hit to turn the narrative around and it’s looking to the Galaxy S8 to do that. According to a report from Reuters on Sunday, the company confirmed that a key feature of its new flagship smartphone will be the launch of Viv — its own digital assistant.
Viv will take on Apple’s Siri and Alphabet’s Google Assistant.
Galaxy S8 vs. iPhone 8 and Google Pixel
When Samsung launched Galaxy S7 early in 2016, the competitive landscape looked favorable for SSNLF. The new flagship smartphone corrected most of the complaints received when the company switched to its new metal and glass design the previous year and was a stunner in looks and performance.
With arch-rival Apple switching to a three-year product cycle, the iPhone 7 was expected to be a boring release. The rumored axing of the headphone jack in the new Apple iPhone would cause resentment that could push Apple fans to an alternative. And launching the Galaxy Note 7 phablet in August — just a month before Apple’s big iPhone event — would help take any wind out of Apple’s sales.
The Galaxy Note 7 backfired, however, and at a horrible time.
The iPhone 7 generated more excitement than expected, and worse, just as Samsung was struggling with a barrage of negative publicity, Alphabet went and released its own premium smartphone, the Google Pixel.
Not only was the Pixel competing directly with Samsung’s Galaxy S7, it featured a new Google Assistant that was exclusive and not available to other Android smartphones.
The Galaxy Note 7 stink also made consumers leery about buying a Galaxy S7 (although it had never been implicated as having an unstable battery) leading Apple to capture 103.6% of the entire smartphone industry profits in the last quarter.
Then in October Samsung purchased Viv. The strategic move kept Viv from making its way back to Apple, where many had hoped it would be folded into Siri. And now we know the company immediately put the Viv team to work on integration with Galaxy S8.
When Samsung’s flagship arrives early next year, it will be equipped with its own AI-powered customized personal assistant to take on Siri and Google Assistant, with exclusive Viv integration. 2017 is shaping up to be an epic battle for flagship smartphone market share.
Apple will be pulling out all the stops with a 10th anniversary iPhone 8, with a new form factor (rumored to be all-glass). Alphabet will be taking what it learned from Google Pixel and releasing a followup that is certain to be a big improvement over an already excellent debut launch.
But all eyes will be on Samsung. The company has to prove the Galaxy Note 7 fiasco is behind it. Galaxy Note 8 not only has to go toe-to-toe with iPhone 8, it also has to prevent Google Pixel from stealing its thunder — and its position as the top-selling premium Android smartphone.
A new Galaxy S8 equipped with its customized Viv personal assistant will be Samsung’s shot at winning back customers and giving Samsung stock a shot in the arm by revitalizing its mobile division’s profits.
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.