January 9, 2006 1:07 PM PST

Samsung to assault Apple with ads, products

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January 6, 2006
LAS VEGAS--Electronics giant Samsung said Apple Computer will feel the heat this year.

Samsung last year publicly vowed to take away Apple's top spot in music players by 2007. This year, the South Korea-based company will kick off that effort with a slew of products and large ad campaigns, Peter Weedfald, senior vice president of consumer electronics for Samsung's North American division, said during an interview last week at the Consumer Electronics Show here.

Macworld Expo, Apple's opportunity to be in the spotlight, begins this week.

"What's the difference between how they have gone to market and how we have gone to market? It's real simple. They spent $165 million last year to advertise Apple MP3 products. We spent $1 million," Weedfald said. "We are going to break the code. In 2006, we are going to over-invest in advertising and marketing around these really hot, new digital video and digital audio products, and we will spend tens of millions of dollars."

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Several companies have tried to knock Apple off its perch, with only limited success. Samsung, however, has tools that might help it put up a spirited attempt. It is one of the largest tech companies in the world and has several labs and designers.

In North America, consumer electronics revenue came to $17 billion in 2005. It will likely grow to $20 billion in 2006, a 16 percent increase.

Apple has maintained a distant lead in the MP3 market. So to gain market share, Samsung said it will issue a broad array of products, some of which it expects to become breakaway hits. That's how the company became a top player globally in cell phones.

In North America, Samsung will launch more than 180 new products or upgrades to existing products, according to Weedfald. For over a year, it has released a new cell phone in North America every two weeks, he said.

"The moniker we want to be known for is as a jaunty, flinty, spirited technology leader," he said. "The way you have to do that is continue to come out with technology breakthroughs."

Many of the company's music players will sport dual functionality. The Helix and Nexus MP3 players, unfurled at CES, come with an integrated XM satellite radio receiver. The devices took about four and half months to concoct from conception to final product, Weedfald said.

Other products will combine a portable TV with a music player.

Samsung will also try to jumpstart the portable video market this year. Some portable video devices will be primarily video players, while others will be phones or MP3 players first.

"Videoconferencing is one of the biggest applications on the planet. Video will be a huge application across all of these pieces of glass," Weedfald said. "It has been very difficult and painful to watch editors get excited about Apple's video products when we've had those products seven, eight months earlier, when (Apple CEO) Steve Jobs was denying he was interested in that."

The willingness of Hollywood studios to finally release downloadable movies and TV shows--downloads that might get swapped around personal networks--could also help jumpstart this market. Video devices will, in turn, help movie studios, Weedfald said. Right now, studios release movies to theaters and release the DVD months later.

"How much DVD sales is Hollywood losing because they are delaying the release by four to five months? They want to release the DVD when the movie is out, at the Valhalla or peak of interest," he said. "For them to speed that up, they need devices where you can buy 'King Kong' the day after you see it."

Apple, he added, deserves some credit for getting content providers to embrace digital technologies.

"Apple did something smart. What they said was, 'You have the show "Desperate Housewives," and you spend maybe a million to produce one episode. That thing is going to sit on a shelf for a year or two until it goes into syndication or DVD. What if the next day, Mr. ABC, after you've made money on advertising, I could take the fresh lettuce of content and sell it the next day for $1.99 and give you back $1.50?' And someone at ABC says...'That's a good idea.'"

12 comments

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Samsung will overtake iPod?
Umm...OK.
Posted by egarc--2008 (28 comments )
Reply Link Flag
Good luck with that
They said the same thing last year.. and we all know how well they did in the MP3 player market in 2005.

Hey maybe if they keep up this "breakaway" pace they have set they may even gain another 1% of market share by 2007.
Posted by (27 comments )
Reply Link Flag
not going to happen, Samsung
Maybe if Samsung can make a better product not just flood the
market with JUNKs.... there might be a chance.
focus more on develop a better product first... Rule of marketing
Posted by eggyacid (2 comments )
Reply Link Flag
Wrong Idea
Ease of use and and simple form factor are what have sold iPods,
not the advertising.
Posted by djemerson (64 comments )
Reply Link Flag
marketing money matters
Well, Apple didn't spend $165 marketing the iPod last year just because they had too much money and didn't know what to do with it. Heck, a lot of people think that ALL mp3 players are iPods.

I don't remember hearing about any Samsung products so far that are a threat to the iPod though. Heck, I suspect Samsung will be lucky to overtake SanDisk for the number two spot in the DAP market. SanDisk players work quite well, and are very affordable.
Posted by mistergoodman (20 comments )
Link Flag
Just keep making them printers
I love my Samsung personal laser printer. Got it on BF for $59 w/shipping. Forget the music player business. Focus on corporate sales.
Posted by sanenazok (3449 comments )
Reply Link Flag
It's going to be crowded at the top!
First it was Creative that had "declared war on Apple" and spent
massive amounts on an advertising campaign, but instead ended
up barely breaking even.

Then Dell, whose CEO had a quote along the lines that back
when he was a young dude there was this device called a
"Walkman" that now no one remembers. Didn't help the sales of
the Dell DJ though.

Then Sony, who after finally seeing the MP3 light and
downplayed its ATRAC format, started bringing a new design out
every few months hoping to find that stuck.

Then Toshiba, with Bill G spruiking their new portable media
center in his CES keynote. (Because we just know how everyone
wants heavily restricted subscription .wmv playback on a 2"
screen.)

Then Creative again, this time with CNET rooting for them (best
of show award, negative iPod stories, etc).

And now Samsung, who wins both ways anyway, since Apple
actually buys their flash memory from them.

So...

When Apple is finally KilledForSure(tm), it's going to be a
crowded place for so many companies whose marketshare will
all suddenly take the lead.
Posted by dotmike (154 comments )
Reply Link Flag
flinty & jaunty?
Flinty refers to having a likeness or consistency of flint, a hard gray
rock used on Survivor to start fires. Jaunty refers to having a
cheerful, self-confident manner. So, these new mp3 players will
easily catch fire, and Samsung will be happy about it? Did I
understand that right?

Someone please buy this man a dictionary & thesaurus. Or maybe
he could just bookmark www.onelook.com on one of his company's
phones?
Posted by adammasri (5 comments )
Reply Link Flag
Good luck Samsung.
You said the same thing a year ago and look where you are.

Give up already.

It aint gonna happen.
Posted by TyTyson (154 comments )
Reply Link Flag
Yea, like it's so much cooler...
to be able to impress people by telling them you have a "YH-J70SB" instead of an iPod.
Posted by (5 comments )
Reply Link Flag
10,000 Products Or Just 1 That Doesn't Suck?
Save your advaertising money until you have a good product.
Posted by systemlag.com (6 comments )
Reply Link Flag
samsung's over confidence
I dont no why samsung wants to assault Apple thru advertisements.But it is the wrong step if it execute its plans to assault apple.

To be top in MP3market means not to assault any other company.

Definitely it will loose money thru advertisements in coming years 2006 2007.

Samsung will always late in releasing products.
It recently released some new cell phones in india with some fetures.That features ae already
given by LG and NOKIA.No one wants to buy that unneccesarily.

"If you want to become Top come with new ideas but not with new assaults".

"No one in history became top by assaulting others".

"Why to wake up Tiger(Apple) when it is calm"
by assaulting them.
Posted by radhekrishna (1 comment )
Reply Link Flag
 

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