The Samsung Galaxy S5 Is Under Assault -- Here’s Why It Won’t Matter

The Samsung Galaxy S5 has a new challenger in Amazon's Fire Phone. Credits: Amazon.com, Samsung

Generally, there are two ways to pitch a new device. You can either tout an experience, or boast a list of interesting features and add-ons. Amazon.com (NASDAQ: AMZN  ) took the latter path in pitching the new Fire Phone, and it's aiming directly for the Samsung (NASDAQOTH: SSNLF  ) Galaxy S5.

On the surface, this looks like a no-contest. Fire Phone boasts a faster quad-core processor, plenty of RAM, a 13-megapixel camera and a high-definition 3-D display. All improvements over what the Samsung Galaxy S5 offers. And yet I don't see the Fire Phone crimping S5 sales anytime soon.

Carrying too much of the load
Not because the Fire Phone lacks panache or is too expensive. To the contrary, at $199 with a two-year contract the device is priced about in line with most other high-end smartphones. So what's the problem? Amazon's exclusive distribution deal with AT&T, which limits the potential customer base. So much for challenging the worldwide sales channel for the Samsung Galaxy S5.

In its press release, Amazon doesn't specify its reasons for choosing AT&T over others. Money surely had something to do with it. But the very fact that the e-tailer took this route means that the S5, available through all four major U.S. carriers and in 125 countries, isn't going to face much heat from the Fire. We can say the same for the iPhone, which launched similarly all the way back in 2007.

Global gains
What the touchscreen was to Apple's first iPhone, Firefly is to the Fire Phone. What's Firefly? A camera-powered shopping system that recognizes any product, instantly, in hopes that you'll buy more from Amazon. More than 35 million songs and 70 million other household items are catalogued in its database. Cool but not exactly awe-inspiring, especially when the handset looks, well, pretty much like every other handset out there. I doubt we'll see many switchers.

Maybe it won't matter. Maybe Amazon will be content to own a small slice of the smartphone market in the same way the Kindle Fire tablet accounts for a small portion of the tablet market. Maybe it's enough to have some devices that sell high-margin digital product from time to time.

Either way, Samsung can rest easy knowing that its worldwide distribution network will keep the Galaxy S5 perched near the top of the smartphone sales charts -- no matter what else Amazon does.

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!


Read/Post Comments (3) | Recommend This Article (11)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 21, 2014, at 10:07 AM, tabascoz28 wrote:

    I believe the S5 has a faster CPU with a Snapdragon 801 clocked at 2.5 and a higher pixel count for the camera at 16M. The Firephone has more cameras and a 3D display.

  • Report this Comment On June 21, 2014, at 6:20 PM, tokar1118 wrote:

    Tim, did you bother to do any research before writing your article, or did you just wing it?

    The S5 beats the Fire phone in nearly every category, including CPU, camera, and display,despite your claim otherwise. That's not opinion, it's fact. The S5 has an 801 2.5 ghz processor compared to an 800 2.2 ghz of the fire phone, the S5 has a 16 mp camera compared to the 13 mp of the fire, and they both have the same RAM. Not to mention the 1080p display of the S5 compared to the 720p of the fire phone. A 3d gimmick screen does not beat an HD screen and one of the beat displays on the market.

    The fire phone is exclusive to AT&T, so kudos for getting that right.

  • Report this Comment On June 21, 2014, at 7:17 PM, tokar1118 wrote:

    Tim, please do some research before writing false information.

    The fire phone does not have better specs than the S5, in almost any category. The processor is faster on the S5, the camera has a higher mp count on the S5, the RAM is the same, and the S5's screen is miles better than the fire phone.

    "Looks like a no contest"? Yeah, for the overpriced fire phone.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3000258, ~/Articles/ArticleHandler.aspx, 10/20/2014 10:08:58 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement