Counterpoint Research once again attended the Samsung Unpacked event in New York City. With 3,000 media and Samsung partner attendees, the event started with Samsung’s mobile chief D.J. Koh promising to create a Samsung ecosystem spanning multiple platforms through a new generation of intelligent experiences. He did not disappoint. Unpacked 2018 featured a plethora of new announcements from the new Note 9 and Bluetooth capable S Pen, to a new Galaxy Watch series, a speaker dubbed the Galaxy Home, and partnerships with both Spotify and Fortnite all being combined to work seamlessly with their new Bixby AI smart assistant.

Let’s start with the Note 9. This year, the device is debuting amidst a weaker than usual Q2 performance from Samsung due to a sluggish premium smartphone market. Fiercer competition in this space has lead Samsung to launch (August 24^th officially) the Note 9 a little earlier than planned to remain competitive in the space. For many attendees the big question to be answered was how the Note 9 would differentiate itself from its predecessor and the S9 series. Koh himself said that raising the bar each year becomes more difficult to do.

Unpacked confirmed many of leaks and rumors that have been circulating over the last several weeks. The Note 9 is a stellar device, sporting a 6.4” Quad HD+ Super AMOLED ‘infinity’ display alongside the powerhouse 10nm Snapdragon 845 processor that we see in all high-end Android devices currently. It also comes in 6GB RAM/128GB (for $999.99) and 8GB RAM/512GB (for $1249.99) configurations which can potentially be expanded to a whopping 1 terabyte through a 512GB Micro SD (which Samsung is also conveniently launching soon). Just like its predecessor it is IP68 water resistant and still has the 3.5mm headset jack. With the Note 8’s success in terms of battery performance, the new Note 9 is actually going bigger, with a 4,000 mAh battery to support the daily needs of its power users. The Note 9 features dual 12MP cameras with the same variable dual aperture feature (f/1.5 or f/2.4) found in the S9 and S9 Plus. Samsung listened to its user base and moved the fingerprint reader underneath the cameras this time.

What sets the Note 9 apart though is the new and improved S Pen stylus. This year it has Bluetooth capabilities which allows the device to have several new features. It will allow the Note 9 to take pictures through a simple click of the S Pen with both the front and back camera. It can also be used to pause and play YouTube videos, as well as control presentations. In fact, many parts of the Unpacked presentation were actually controlled through the S Pen. The S Pen can last for 30 minutes or 200 clicks until it needs one minute to recharge - it's powered by a super capacitor, rather than a battery. It also currently offers some customized binding capabilities to work with Snapchat and Chrome. More features will probably come as Samsung promises to release the SDK in the coming weeks. For example, while you currently can use the S Pen to take photos and selfies, using it to take videos is not yet possible.

Will it be Enough?

The Note 9 is certainly a great upgrade from the Note 8 which has gotten a bit long in the tooth over the last months. The S9 and S9 Plus devices were weak upgrades compared to the S8 and S8 Plus so many people opted to skip the upgrade. The Note 9 will face similar challenges, but Samsung is betting on being able to capture a more entrepreneurial, artistic, and perhaps younger audience with their device. Partnerships with both Epic Game’s Fortnite and Spotify certainly help to attract this audience, and the new and improved S Pen will be a great addition to both those who are business oriented and others looking to be more creative. For the gamer especially, Samsung has incorporated a new “water carbon cooling system” that will reduce heat and performance lag while playing graphic intense games. Samsung’s DeX experience also got an upgrade as the phone can be turned into a pseudo-desktop through just an HDMI to USB-C adapter. It also added a second screen functionality where you can have a video playing on the big screen while also using the phone as you normally could.

However, the jury is still out if the device can boost sales of Samsung’s premium category as the device will compete with other premium phones such as the iPhone X in the US and the P20 Pro from Huawei and the Find X from Oppo internationally. The price is a big factor. Apple proved that despite the hefty price tag, people are willing to spend money on the iPhone X. The Note 9 will have to prove itself there, with US carriers already announcing discounts and promotions on the device. One major point that the Note 9 has going for it is that it’s riding the success of the Note 8 in terms of battery performance. The Note 8 was the first device since major battery issues forced the recall of the Note 7. Some consumers lost trust in the series due to this and opted to try other premium phones. The Note 8’s success in delivering a stellar device has proven to many that the Note brand can be trusted again. This will help move the needle for those considering upgrading this year. Preorders begin August 10^th in the US with the option of getting a pair of AKG N60 over-ear, noise cancelling headphones or 15,000 V bucks and the exclusive Fortnite Galaxy skin. Both are available for $99.

Creating the Ecosystem

Samsung rounded out the Note 9 presentation by showcasing its ecosystem strategy that takes a page out of Apple’s book. It debuted a new Galaxy Watch series with a standalone and LTE cellular connectivity variant. The device can pair with the Note 9 to integrate health and fitness apps. A new speaker was also unveiled during the event. The Galaxy Home with AKG partnership promises new AI functionality through Samsung’s Bixby AI assistant. More details to come here in the future. AI has also been integrated into the camera software, which now gives you a notification if the picture you took is blurry or if someone has their eyes closed. Pricing for the Galaxy Watch is $330 for the 42mm version and $350 for the 46mm version. No pricing mentioned during the event on the AI assistant.

In the heart of this is the previously mentioned AI assistant Bixby. Bixby will allow for “intelligent conversations” to happen where users can look for new restaurants, call an Uber, or book tickets solely using the AI assistant. All these devices can be connected and have the ability to transfer media. For example, a user can listen to a song on Spotify on the Note 9 and then with the push of a button transfer over to the new Galaxy Home speaker without interruption.

TL;DR
The Note 9 is targeting a new customer base that is more entrepreneurial minded. The Note 9 offers some nice improvements over the Note 8, especially with the new S Pen. The ecosystem approach from Samsung hinges on proper integration of AI to create seamless experiences for the end-user. Overall the device and approach seem promising but the ecosystem strategy will have to be pushed more to move the needle for premium device sales.