Integration at Samsung
Samsung (005930.KS) announced its flagship smartphone line for 2025, the Galaxy S25 series today. While the event detailed a number of hardware improvements, the real focus was on (not surprisingly) AI. It seems that while Samsung continues to upgrade hardware to maintain a competitive stance against Chinese smartphone brands, we believe they understand that the incremental hardware improvements made each year are not enough to stimulate consumer to upgrade unless their phone begins to age out. Foldables represent a new mobile category but due to their high price, volumes are relatively low, so it is essential that major brands maintain a flagship line to offset mid-range, lower margin lines.
There are times when hardware improvements can be a driver for consumers, as were OLED displays when they were new to the mobile world, and multiple cameras back a few years ago. But at this juncture, even OLED displays cannot be much larger and there is no new display technology on the near-term horizon that is appreciably different from what is available today. Higher resolution cameras will always be possible as semiconductor technology improves, as will chipsets, CPUs, and GPUs, but other than foldables, mobile phone hardware will improve slowly and slowly does not excite consumers.
Smartphone software is in a similar position. Smartphone applications have changed little over the past few years and do almost nothing to convince consumers to upgrade their mobile devices, but Ai for mobile devices is developing quickly and represents a platform where smartphone brands can compete and attract attention. Ai does need processing power but Qualcomm (QCOM), Mediatek (2454.TT), Apple (AAPL), Google (GOOG), and Samsung continue to adapt their chipsets to the needs of AI, and while in the true sense, AI is a hardware-based system, on a mobile device it appears to consumers as software and requires relatively little hardware or mechanical changes or design restrictions. However AI represents change and change in the CE market is something every marketing department looks toward to sell more devices.
Samsung seems to understand the fact that there are two AI’s. One, answers your questions and interacts directly with users, while the other works silently in the background. But they also seem to understand that the two should be working together and if there was anything to be taken away from the Samsung S25 event, it was that Samsung is interested in merging those two AI processes. This not only improves the user’s experience with the phone but lessens the need for breakthrough hardware or software application improvement to attract consumers. By leveraging Ai to allow applications on the phone to work together, the applications seem to be improved, even if they are not, and the ability of the AI to control or direct applications without the user having to open an application for each task is an improvement worth buying a new phone for.
Samsung’s multi-modal Ai allows the user to speak to the Ai directly (voice or even audio) and gives the AI the ability to create ‘agents’ that perform tasks that the user would typically have to do by pausing what they are doing to open a separate application. Here’s an example. The user is listening to a conference call which happens to be in Korean. The Ai translates the call in real time but also compiles a transcript of the call. When the call is finished the user tells the AI to summarize the call and reviews the AI summary. The user tells the AI to change the 3rd paragraph to be more concise and reviews the change. The user then tells the Ai to write a cover letter describing the circumstances of the call and to send the cover letter and the transcript summary to those in the ‘Level 2 Client’ list.
Rather than having to open a number of applications to complete each part of the full task, the user either read or listened to the AI during each step and opened no applications. The AI interfaced with the necessary applications and completed each task. The system also gives the option to allow the Ai to collect information from other applications and devices in the Samsung ecosystem that can help it build a detailed profile of the user in order to make better or more personalized suggestions.
This can only happen when the AI is integrated into applications and Samsung has the advantage of having a recognizable enough brand that users are willing to use Samsung applications on its phones, along with a variety of externally developed applications. Samsung offers external developers a number of tools to give them access to Samsung’s One UI 7, the user interface that sits on top of Android and provides the hooks to the AI, but there is nothing better than having that interface and the applications themselves developed in-house. Only Samsung, Apple, and Google have the ability to tie their hardware and AI to such large application bases, with both Apple and Samsung concentrating on processing AI on device whenever possible.
As noted Samsung said all the right things about its AI at the Galaxy S25 event but everyday use can be much different from well produced event videos. The Galaxy S25 family is now on pre-order and will be available in stores on February 7, at which point we should be able to get a better idea as to whether the phones live up to their marketing pitch. The good news is that if they do, there is no premium being charged for the AI capabilities as the phones are priced the same as last year’s models, a plus for consumers. Below we show only the differences between the hardware in the Galaxy S25 and last year’s Galaxy S24.
There are times when hardware improvements can be a driver for consumers, as were OLED displays when they were new to the mobile world, and multiple cameras back a few years ago. But at this juncture, even OLED displays cannot be much larger and there is no new display technology on the near-term horizon that is appreciably different from what is available today. Higher resolution cameras will always be possible as semiconductor technology improves, as will chipsets, CPUs, and GPUs, but other than foldables, mobile phone hardware will improve slowly and slowly does not excite consumers.
Smartphone software is in a similar position. Smartphone applications have changed little over the past few years and do almost nothing to convince consumers to upgrade their mobile devices, but Ai for mobile devices is developing quickly and represents a platform where smartphone brands can compete and attract attention. Ai does need processing power but Qualcomm (QCOM), Mediatek (2454.TT), Apple (AAPL), Google (GOOG), and Samsung continue to adapt their chipsets to the needs of AI, and while in the true sense, AI is a hardware-based system, on a mobile device it appears to consumers as software and requires relatively little hardware or mechanical changes or design restrictions. However AI represents change and change in the CE market is something every marketing department looks toward to sell more devices.
Samsung seems to understand the fact that there are two AI’s. One, answers your questions and interacts directly with users, while the other works silently in the background. But they also seem to understand that the two should be working together and if there was anything to be taken away from the Samsung S25 event, it was that Samsung is interested in merging those two AI processes. This not only improves the user’s experience with the phone but lessens the need for breakthrough hardware or software application improvement to attract consumers. By leveraging Ai to allow applications on the phone to work together, the applications seem to be improved, even if they are not, and the ability of the AI to control or direct applications without the user having to open an application for each task is an improvement worth buying a new phone for.
Samsung’s multi-modal Ai allows the user to speak to the Ai directly (voice or even audio) and gives the AI the ability to create ‘agents’ that perform tasks that the user would typically have to do by pausing what they are doing to open a separate application. Here’s an example. The user is listening to a conference call which happens to be in Korean. The Ai translates the call in real time but also compiles a transcript of the call. When the call is finished the user tells the AI to summarize the call and reviews the AI summary. The user tells the AI to change the 3rd paragraph to be more concise and reviews the change. The user then tells the Ai to write a cover letter describing the circumstances of the call and to send the cover letter and the transcript summary to those in the ‘Level 2 Client’ list.
Rather than having to open a number of applications to complete each part of the full task, the user either read or listened to the AI during each step and opened no applications. The AI interfaced with the necessary applications and completed each task. The system also gives the option to allow the Ai to collect information from other applications and devices in the Samsung ecosystem that can help it build a detailed profile of the user in order to make better or more personalized suggestions.
This can only happen when the AI is integrated into applications and Samsung has the advantage of having a recognizable enough brand that users are willing to use Samsung applications on its phones, along with a variety of externally developed applications. Samsung offers external developers a number of tools to give them access to Samsung’s One UI 7, the user interface that sits on top of Android and provides the hooks to the AI, but there is nothing better than having that interface and the applications themselves developed in-house. Only Samsung, Apple, and Google have the ability to tie their hardware and AI to such large application bases, with both Apple and Samsung concentrating on processing AI on device whenever possible.
As noted Samsung said all the right things about its AI at the Galaxy S25 event but everyday use can be much different from well produced event videos. The Galaxy S25 family is now on pre-order and will be available in stores on February 7, at which point we should be able to get a better idea as to whether the phones live up to their marketing pitch. The good news is that if they do, there is no premium being charged for the AI capabilities as the phones are priced the same as last year’s models, a plus for consumers. Below we show only the differences between the hardware in the Galaxy S25 and last year’s Galaxy S24.
⁎ The 4th main camera (ultrawide) in the S25 Ultra is 50 MP f/1.9 while the 4th mani camera in the S24 is 12MP f/2.2. The other three cameras are the same.
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