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Samsung Says Galaxy Note Is a Hit, with 5 Million Sold

Samsung Says Galaxy Note Is a Hit, with 5 Million Sold
March 28, 2012 1:55PM

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Five million Samsung Galaxy Notes sold is "nothing to shake a stick at," said mobile analyst Michael Morgan, who said the Galaxy Note falls into a narrow category as "a phablet or a tweener." Morgan estimates that the bulk of Samsung's Galaxy Note sales, about 3 million, have been in the U.S., and a key selling point is LTE data speeds.

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It may be an oversized smartphone that acts like a tablet, or a mini-tablet that makes phone calls. But one thing Samsung's Galaxy Note does not do is sit on shelves.

The South Korean electronics giant is boasting that the Android-powered, 5.3-inch Super AMOLED touchscreen device, with its unique S-Pen stylus, has averaged about 1 million sales a month since its release in September.

Impressing Analysts

In an announcement on the company's global blog, Samsung Tomorrow, the company said the device's popularity helped make Samsung the leading phone manufacturer in South Korea with about two-thirds of the mobile phone market.

The Galaxy Note, which Samsung has aggressively marketed, is available in the U.S. via AT&T for $299.99 and is compatible with the carrier's high-speed LTE data network, which it launched last September. An AT&T spokeswoman declined to comment on the news.

The Note currently runs Android 2.3.6, also known as Gingerbread, and Samsung expects to update it to 4.0, or Ice Cream Sandwich, later this year.

Five million devices sold is "nothing to shake a stick atm" said ABI Research mobile devices analyst Michael Morgan, who said the Note falls into a narrow category as "a phablet or a tweener."

Morgan said the numbers show the device has "an addressable base" in numerous distribution points. He estimates that the bulk of sales, about 3 million, have been in the U.S., and a key selling point is the access to LTE data speeds.

"When it comes to LTE, at this point there is a lot of consumer confusion, especially since AT&T was calling some of their older devices 4G that were running on HSPA+," Morgan said. "It wasn't really clear what the value proposition was for the consumer. I don't need so much bandwidth to send texts or to tweet."

But one clear advantage of LTE data speed, which promises 5 to12 megabits per second for downloads, is video, Morgan said, because they can get content quickly; and a 5.3-inch screen is mighty attractive to those who want to watch movies and TV shows on the go, and don't want to shlep both a phone and tablet.

Given that shipments of LTE devices in 2011 reached 8 million to 9 million units, the Note seems to have done "a pretty good job capturing a good part of the LTE market right up front," Morgan said. "...That says to me that it has staying power if and when they increase the distribution of this device."

Premium Suite Coming Soon

It is less clear that the Note's S Pen was a big draw (no pun intended) for users since at this point it has limited usefulness. Samsung, however, plans to add more functionality to it in the second quarter with a Premium Suite for the Note that will accompany the 4.0 upgrade. Features include custom notebook creation with eight templates; quick creation of sendable notes and cards; the ability to add notes to photos; automatic shape correction for diagrams and a program that provides quick answers to complicated formulas (great for homework cheating).

Morgan said while the Note has "room to grow" it will soon face off against Apple's latest iPhone, which has a tendency to eclipse other devices with superior features.

"When the 4S was released, with its 3-1/2 inch screen, there was a massive uptick [for iPhone] that sucked the sales of LTE smartphones, vastly outperforming phones with larger screens," said the analyst.

This time around, it is "very likely" the new iPhone will be LTE-compatible, he said.

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