Pestal Analysis for Samsung Electronics Essay

Over the past several historic period, there has seen a plethora of patent lawsuits within the smartphone industry. In the higher(prenominal)ly competitive environment, shapers of handsets have been fast-growing(a) in protecting their intellectual properties by suing competitors by claiming infringements on patents. For example, in March 2010, Apple sued HTC for allegedly infringing on 20 Apple patents (Weil, 2010). Apple as well as sued Nokia in 2010 for similar patent infringements(Patent wars, 2011). However, in April 2011 the International Trade Commission recommended that neither HTC or Nokia should be found liable for any infringements. shape up Microsoft reached a licensing agreement in April 2010 with HTC to pay royalties on Android based handsets (Patent wars, 2011). More recently, Apple launched a lawsuit against Samsung in April 2011 claiming Samsung copied design features of the iPhone in its Galaxy line of Android phones (Quigley, 2011).These are just a few examples of legal challenges faced by smartphone manufacturers. Mentioning all lawsuits in the past several years is beyond the scope of this analysis, but it is important to recognize that manufacturers are using their patent portfolios to make it more difficult for their competitors to gain larger mart shares. Even if the majority of cases are found to be dubious, the costs associated with legal battles can hamper or slow down the release of virgin handsets and hence making it more difficult for the manufacturer to stay competitive.Economic purlieuThe North American economy is still rec everywhereing from the financial crisis of 2008. study factors to consider are the unemployment browses, consumer spending. In September 2011 the unemployment rate in the US was 9.1% which is well above the national aver come on of 5.7% between 1948 and 2010 (United States Unemployment). The current high unemployment rate in the US is likely having an impact on reducing smartphone sales.A 9.1% unemploym ent rate represents approximately 28 million Americans out of work. In Canada,the unemployment rate in September 2011 was 7.1% which represents its lowest point since December 2008 (Canada Unemployment). Since January 2010, Canada has been experiencing a downward trend in unemployment (Canada Unemployment).The high unemployment rate in the US has been negatively impacting consumer assurance and has resulted in a decrease in consumer spending. Bloomberg reports consumer spending dropped 0.2% in June 2011 which provides evidence the decrease in hiring and wage increases below the inflation rate are touch on consumer spending (Chandra, 2011). Consumer spending accounts for 70% of the US economy (Chandra, 2011) any fluctuation in this area will have a significant impact on the overall economy. In Canada, the opposite is true.Consumer spending increased by 3.8% from 1st quarter 2010 to the end of 1st quarter 2011 (Canadian Consumer Spending). Consumer confidence is Canada seems to be h igher than the US likely resulting from lower unemployment rates and Canadas faster paced recovery from the global financial crisis. referee 1 http//www.tradingeconomics.com/united-states/unemployment-rate Ref 2 http//www.tradingeconomics.com/canada/unemployment-rate Ref 3 http//www.bloomberg.com/ sensitives/2011-08-02/consumer-spending-in-u-s-unexpectedly-falls-for-first-time-in-two-years.html Ref 4 http//www.moneris.com/AboutUs/MediaCentre/NewsAndEvents/2011/Month/Jul%2014.aspxSocial-cultural surroundThe rise of the information age has made telecommunication more important for both occupancy and pleasure. It is important to determine how receptive a society is to new advancements in technology, particularly smartphone adoption in this case. By measuring smartphone adoption by age demographics, a better understanding of who the primary target groups can be gained. Insights into how different groups of smartphone users use their devices can provide insights into new features or imp rovements in accomplished features.At the end of 2010, there were 63.2 million smartphone subscribers in the US (comScore Inc, 2011). The adoption rate has been increasing annually in December 2009, 16.8% of Americans owned a smartphone, spot in December 2010 the adoption rate increased to 27% (comScore Inc, 2011). By March 2011, 32.2% of Americans adopted a smartphone (ref 2). The increase of just over 10% over a one year period along with over a 5% increase from Dec. 2010 and March 2011 shows that the US population is very receptive to new smartphone technologies resulting in rapid market expansion.Breaking adoption down into demographic groups, 12.6% over the age of 55, 16.7% aged 18 to 24, and 27.2% aged 25-34 owned a smartphone in December 2010 (comScore Inc, 2011). According to comScore, the fastest growing age segments in smartphone adoption are 13 to 17 year old and those aged 55 and up (comScore Inc, 2011).ref1 The comScore 2010 Mobile Year in Review -http//www.comscore.c om/Press_Events/Presentations_Whitepapers/2011/2010_Mobile_Year_in_Review ref2http//www.comscore.com/Press_Events/Press_Releases/2011/6/comScore_Launches_Mobile_Measurement_in_CanadaTechnological EnvironmentThe most important aspect of the technological environment in this case is the cellular network infrastructure. Both the US and Canada have infrastructure in order which supports both voice and data transfers. However, rural regions may have poorer quality of service, and do not always support data transfer. However, most of the population is concentrated in urban and sub-urban regions of both countries these regions have the wireless infrastructure in place to support all uses of smartphones.The infrastructure in both Canada and the US is privatized, which means the network carriers maintain and upgrade it since it is in their best interest to retain and observe cellular subscribers happy.Natural EnvironmentSince Samsung does not manufacture its handsets in North America, the natural environment is insignificant in terms of strategy formulation. Typically, a manufacturer needs to be aware of extreme weather patterns and availabilityof local natural resources within the region they have manufacturing facilities. However certain regions, particularly along the Gulf Coast are prone to hurricanes. These massive storms can damage the cellular network infrastructure which would render smartphones into paper weights.Political/Legal Environment Just random ideas right now for this sectiono wireless communication regulationso electronic device safety regulations?o deregulation of the holler industry Trademark and Patent Lawso Currently there is a large number of patent and intellectual property litigations/lawsuits in the US, particularly in the smartphone industry, including a dispute between Apple and Samsung. Apple claims Samsung copied iPhones design features, packaging, and user interface components. o Patent trolling has become a big discommode in the US. FCC Regulationso Part B of the FCC rules sets rules for radio frequency strengths for 850,900, 1800, and 1900mhz bands in order to prevent interference with other communication devices and infrastructureEconomic Environment US Census Bureau 2010 Census http//www.census.gov/prod/2011pubs/p60-239.pdf o Median household income $49,445 in 2010o Median for family household $61,544o Median for champion female householder $25,456o Median for single male householder $35,627 US International Trade Commission Harmonized Tariff Schedule http//hts.usitc.gov/ o There is no import duty or tariffs for telephones, including telephones for cellular or wireless networks