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Can Samsung Succeed Against Apple Where Dell and HP Failed?

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Not long after Dell (Nasdaq: DELL  ) and Hewlett-Packard (NYSE: HPQ  ) discontinued laptops designed to compete with Apple's (Nasdaq: AAPL  ) sexy ultraportable MacBook Air, Samsung is bringing a new contender to the battlefield. And Samsung may be making the same mistake as Dell and HP.

Samsung's new Series 9 ultraportable does appear to be off to a better start than Dell's discontinued Adamo, which suffered from overpricing and just not being nearly as desirable as the MacBook Air. Dell dropped the Adamo's price repeatedly and upgraded the specifications before finally giving up and pulling it off the market. HP's Envy 13 suffered a similar fate, although the missteps were not as large or as frequent as Dell's. HP at least gets credit for recognizing its mistakes and cutting its losses more quickly than Dell.

Did Samsung learn from HP's and Dell's mistakes? Its Series 9 was well-received at the Consumer Electronics Show in January. First blush reviews by Engadget and CNET are enthusiastic, although they both cite high price as an issue. Samsung is asking $1,649, slightly above the $1,599 price for a top-of-the-line 13-inch MacBook Air. The specs are roughly similar, although the Mac offers only half as much RAM and twice as much drive storage capacity.

Hmm, sound familiar? Once again, a Windows PC maker is trying to defy Apple's long-standing ability to command premium prices and go head-to-head with a Mac at a higher price. Perhaps the Samsung will be discounted at retail and actually be available for less than the MacBook Air, since Macs almost never seem to be discounted from list price.

Samsung is arguably filling an unmet need. The best option for Microsoft (Nasdaq: MSFT  ) Windows users who want a MacBook Air-like machine has been to run Windows on the MacBook Air. That should work in Samsung's favor.

Another plus for Samsung compared to Dell and HP is its ranking in PC World's reader survey of laptop vendor tech support and service. Dell and HP led the latest survey's "losers" list. Samsung was in the middle of the pack. Apple led the "winners" list.

Foolish takeaway
If Samsung's Series 9 succeeds, it will say a lot about changing fortunes among PC vendors. This battle bears watching for that reason alone.

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Fool contributor Cindy Johnson owns shares in Microsoft. Microsoft is a Motley Fool Inside Value selection. Apple is a Motley Fool Stock Advisor recommendation. The Fool has written puts on Apple. Motley Fool Options has recommended a bull call spread position on Apple. Motley Fool Options has recommended a diagonal call position on Microsoft. The Fool owns shares of Apple and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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