SEOUL (Reuters) – Samsung Electronics flagship Galaxy S22 has been hit by reports of low performance and seen mobile phone companies at half price in South Korea just a few weeks after its launch, damaging its image as a competitor. of the iPhone. Consumers have complained – and even filed a class action lawsuit – over the headphone maker’s ad, which he called the most powerful smartphone with a few details about performance management software that they say drastically slows down the premium device when using high-volume processor applications. Such are the allegations that the Korean Fair Trade Commission last month launched an investigation into the world’s largest telephone retailer. The controversy represents a blow to Samsung’s reputation for high-tech phones – and possibly its finances – as it tries to make up for two years of lost sales premiums by analysts and reverse a drop in market share. “The controversy will inevitably be a major blow to Samsung’s credibility,” analyst Lee Seung-woo told Eugene Investment & Securities. At the heart of the complaints is Samsung’s Game Optimization Service (GOS), which manages the device’s performance during the game to prevent overheating and maintain battery life. The manufacturer introduced the software in 2016, a few months before the release of the premium Galaxy Note 7 after a series of battery fires. GOS automatically limits the performance of the device during gaming and other processor-intensive applications, said Geekbench, a widely used performance indicator, which found that the software slowed the S22 processor by up to 46%. The extent to which GOS is slowing down the S22, the lack of details about the software in the marketing material and the inability to turn it off are fueling social media. “This is an unprecedented, crazy issue that can not be justified in any way,” ITSub, a YouTuber with 2.1 million subscribers specializing in gadgets, said in a YouTube post. The story goes on Samsung said it has released an update to allow users to disable the software without risking security. He also said he would continue to invest to innovate in both hardware and software. PRICE FALL The S22 series sold 1 million devices in South Korea within six weeks of launch, reaching the mark two weeks faster than its predecessor, Samsung said. “The deliberate downgrade certainly had a negative impact, but its real impact on Samsung sales seems limited. The data show that sales are not affected much,” said Kim Ji-san, an analyst at Kiwoom Securities. However, South Korea’s three largest telecom providers have nearly doubled their subsidies for the S22, pushing its price low to 549,000 won ($ 451) from a turnover of 999,000 won. Apple Inc.’s iPhone 13, launched in October, starts at 1,090,000 won with providers offering lower subsidies of around 150,000 won. “When subsidies rise to all three telecoms at the same time, it is usually the manufacturer who makes the contributions,” said an official with LG Uplus Corp., who declined to be named because of the sensitivity of the issue. Samsung’s market share in devices over $ 400 in 2021 shrank 3 percentage points to 17% from a year ago, while Apple’s share increased by 5 percentage points to 60%, according to data from market researcher Counterpoint. The data also showed that sales of both the S20 and the S21 were below the 30 million units in the first year of the S series. Early shipments of the S22, released in late February, indicate that Samsung will ship more than 6 million phones by the end of March, broadly as expected, said Sujeong Lim, Deputy Chief Executive Officer. However, Lee at Eugene Investment & Securities expects the GOS boom to be combined with rising component costs to leave April-June operating profit in Samsung’s 3 trillion won, down from a previous forecast of 3.4 trillion won. IBK Investment & Securities analyst Kim Un-ho also downgraded his forecast to 3 trillion won from 3.5 trillion won. Samsung announced on Thursday that it expects to report an estimated 50% jump in total operating profit in January-March on April 28, as demand for its memory chips remained stable. SPEED LIMIT The S22 cracks at the lowest value indicated that the handset did not have a cooling component called a steam chamber, suggesting increased dependence on overheating management software, the reviewers said. Analysts say the drive for software solutions stems from a renewed cost-cutting policy – a strategy they say is eroding reputation as a hardware-based innovator. Lee said Samsung “puts too much emphasis on reducing costs, which led to this unfortunate case.” Samsung Electronics Vice President and CEO Han Jong-hee told an annual shareholders’ meeting last month that “it will not compromise on quality to reduce costs and will continue to introduce products that prioritize experience and quality.” of first class products “. At least 1,885 consumers are not convinced, having filed a lawsuit claiming that Samsung’s marketing is inflating the S22’s performance. “If Porsche had a top speed of 100 kilometers (62 miles) per hour, would you still buy it?” said Kim Hoon-chan, a lawyer representing consumers, adding that about 1,500 people have joined to file a second lawsuit. ($ 1 = 1,218,4000 won) (Report by Byungwook Kim · Additional Report by Joyce Lee · Edited by Miyoung Kim and Christopher Cushing)
