Samsung & Google – Engineering disease

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Intransigence helps Apple and the Chinese.

• Google and Samsung both have a bad case of engineering disease that prevents them from working together in a way that I think would greatly benefit both of them.
• Engineering disease relates to a condition where the desire to solve technical problems and do things oneself overrides business sense.
• Engineers often get so excited about whether they can develop something that they forget to ask whether they should develop that something.
• Engineering disease almost always ends in disaster and in the case of Samsung and Google it is preventing them from doing far more together.
  • Samsung’s latest affliction relates to AI, and in that regard, I think that Samsung is investing in features that have a negative effect of its brand appeal.
  • The flagship product is the awful Bixby which is more of an annoyance to Samsung users and is rapidly becoming a reason not to buy a Samsung device.
  • Not to be deterred by the universally negative feedback on the product, Samsung is investing more money, hiring more engineers and opening more research centres that have so far delivered less than zero.
  • Furthermore, Samsung plans to put its AI into every consumer electronics product that it makes which could do real damage in categories where Samsung does not have the same dominance that it does in handsets.
  • For example, in a toss-up between and Sony TV running Google Assistant and a Samsung TV running Bixby (assuming all other things being equal), I know which one I am choosing.
  • The same goes for fridges, washing machines etc.
  • I very much doubt that Bixby 2.0 will be much better and given that its competitors are generating far more data and improving much more quickly, I think that Bixby has no chance of ever being a viable digital assistant.
  • The one exception is in Korea where Korean speakers tell me that Bixby is pretty good.
  • As a total percentage of Samsung’s shipments, Korea is a rounding error meaning that investments to make Bixby work well in the Korean language offer a very poor return.
  • However, what it does do is make Korean speaking engineers feel proud of their achievement which, unfortunately, does nothing for shareholders.
  • Google has suffered a series of bouts of engineering disease that began with the acquisition of Motorola Mobility in 2012 (see here) and have continued off and on ever since.
  • The current affliction is worsening as Google has spent another $1.1bn to acquire HTC’s design talent (see here) as well as turning its hand to building its own chipsets.
  • The problem is that almost all of Google’s hardware acquisitions have felt great discomfort being owned by a company that does not really understand hardware.
  • The result has been infighting and a failure to use Google’s strengths to increase market share of the products in question.
  • Consequently, some of the excellent innovation that went into the Pixel 2 phone (eg one camera portrait mode), have completely failed to gain any market recognition.
  • This gives competition the opportunity to copy these innovations, get them to market and reap the benefits of what Google has sown.
  • Fortunately, Google’s innovations are almost entirely software based, and almost all handset makers (except Apple) are terrible at writing any software outside of basic handset management.
  • Consequently, whatever wondrous innovation that Google puts into the Pixel 3, is unlikely to ever ship more than a rounding error, making Google’s continued foray into hardware, pointless in my opinion.
• From this it is clear to me that Samsung and Google are a great fit.
• If Samsung was to abandon its aspirations to create in AI and work on a time-based exclusive deal with Google, I think its handsets and other devices would have far more appeal than they do today.
• For example, Google’s superb portrait mode could be used to differentiate the imaging in the Galaxy s9 rather than the completely pointless variable aperture.
• A much deeper integration of Google Assistant into Samsung devices rather than the universally awful Bixby would further set Samsung apart from the competition.
• Obviously, Samsung would only have the exclusive on these technologies and features for maybe a quarter or two, but I think it would make its products far more attractive when compared to the iPhone.
• The problem is that both companies seem to believe that they can replicate each other’s core competence which reviews and market forces have clearly shown not to be the case.
• As long as this state of affairs persists, the advantage passes to the Chinese vendors like Huawei, Xiaomi, Oppo and Vivo who are increasingly looking to crush Samsung overseas as they have done at home.
• It also helps Apple which I consider to be second rate in AI as Google’s best innovations that could attract users to Android remain effectively not present in the market.