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June 17, 2013

Yet Another Galaxy S4 is Coming, This Time with True 4G LTE-Advanced Capability

Last week we took note of Samsung's new work on what it has labeled 5G technology - primarily focused on next generation wireless network infrastructure. Meanwhile, Samsung co-CEO J.K. Shin has been making a lot of mobile device announcements of late, so why should this morning be any different? Today Shin also got on the faster wireless bandwidth bandwagon by announcing that there is yet another Galaxy S4 variant on the way.

You heard right - yet another Galaxy S4. The most recent new efforts have involved an S4 Mini, the ruggedized S4 Active, and a new hybrid camera-smartphone device dubbed the S4 Zoom. These are all derivatives of the core Galaxy S4, but none of them offer advances beyond the core S4.

Today Shin did indeed offer yet another S4 announcement, only this time around, the announcement came with an important difference - a new Galaxy S4 will be made available that will be an advanced version of the current S4. How so? The new iteration will sport the same software feature sets, but it will be delivered with the ability to take advantage of LTE-Advanced.

LTE-Advanced is in fact the true next generation 4G wireless broadband technology - or it would be if Verizon Wireless and AT&T hadn't high-jacked the terms LTE (which is in fact a 3.5G interim technology that was supposed to lead to LTE-Advanced/real 4G network implementations) and 4G for current wireless network marketing purposes. LTE-Advanced is truly "advanced" and will deliver a huge increase in both uplink and downlink speeds compared to LTE.

Both AT&T and Verizon Wireless market their current generation LTE networks as 4G wireless data infrastructure. But the reality is that the true 4G standard is defined not by either AT&T or Verizon and their marketing departments, but by the International Telecommunications Union (ITU). The ITU has long settled on 4G to deliver, at a minimum, an average download bandwidth of 85 MBPS - or approximately 5.5 times faster than LTE.

For comparison purposes, the current LTE networks are able to deliver downlink speeds that average 15 MBPS and LTE uplink speeds that average 1.5 MBPS. LTE networks of course also provide greatly reduced latency, a key reason any user will want to migrate to LTE even if the wireless carriers are spoofing us with their 4G marketing.

The ITU refers to its 4G standard as International Mobile Telecommunications-Advanced, aka IMT-Advanced. Beyond LTE and IMT- Advanced, there is a true next generation technology referred to as LTE-Advanced, which the ITU has qualified as a legitimate IMT-Advanced technology. LTE-Advanced is therefore a true 4G wireless data network. And the truth of the matter is that neither AT&T nor Verizon Wireless will be delivering LTE-Advanced any time before 2016-2018.

Japan and South Korea are the only places where true 4G/LTE-Advanced will be found, and since Japan does not favor anything related to Samsung - they are a huge iPhone region - that means that the new Galaxy S4 will likely only find a market in the foreseeable future in South Korea. Well, those South Koreans are quite lucky, in fact, that they will be able to tap into LTE-Advanced - it is a true and non-trivial leap forward in smartphone communications. Shin noted, "We'll be the first with the commercial launch of the advanced 4G version of the smartphone." That said, Shin did add that Samsung is in talks with several overseas carriers, none of which he named, to offer the new S4 - though we surely doubt this would represent any real market impact.

More likely, the real LTE-Advanced possibilities will be found in emerging markets. Without legacy systems to deal with, emerging markets - especially those in China - can make a direct leap to LTE-Advanced. In many ways this would represent an ironic turn of wireless broadband events. Samsung's combined efforts on both next gen wireless infrastructure and on advancing the state of the art in smartphone capability will leave it nicely prepared for future growth. No one can fault that strategy.

The new Samsung S4 with LTE-Advanced support will be powered by Qualcomm's chipsets and Shin noted that the new phone will cost more than the current S4. We wonder what sort of margins Samsung will be able to deliver on it, and we suggest that the new version will not likely help the company with S4 sales globally. Recently Samsung took a non-trivial $12 billion market cap hit due to revised and lowered financial analyst estimates on both total Galaxy S4 sales and margin estimates.

Unlike the various hardware and software gimmicks Samsung has bestowed on the current Galaxy S4 in the name of innovation, delivering on the ability to access true LTE-Advanced/4G networks - while not strictly an "innovation," nevertheless represents a true advancement on the current state of the art. We're very much looking forward to seeing it become reality.

Edited by Alisen Downey

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