Editorial by Andrew Kameka on Monday February 10, 2014.
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Samsung faces an awkward dilemma with the Galaxy Gear smartwatch. The watch has been neither a commercial nor critical success, and a big reason for that is consumers have balked at the price. Putting the many negative comments from reviews aside, consumers don't want to spend $299 on a so-so accessory, especially when executives admit that it has problems and says a follow-up is coming soon. So how the heck can Samsung fix this problem?
An obvious solution is to cut the price of the Galaxy Gear, something that Samsung has been contemplating, according to rumors published by ZDNet. However, the company can't settle on a price because it plans to release a new watch, and it fears costing more than Apple's smartwatch. If cost is truly a hindrance to getting this product in more people's hands, Samsung needs to address the issue and drop the price. You cannot ask someone to pay $300 to $600 for a smartphone and then ask for an additional $299 for an accessory that is rendered useless if he or she no longer uses a Samsung device. At most, the Galaxy Gear should cost $149, the price of the smaller but more successful Pebble.
The problem with changing the Gear's costs is that it's complicated by Samsung's willingness to refresh the product less than a year after its release. Multiple outlets, including the New York Times, have spoken with sources who say that the Galaxy Gear 2 will be announced at MWC later this month. A Samsung executive previously confirmed plans to release a follow-up in early 2014. If a newer, better, and more sensible version of the Gear is on its way, how could Samsung ever expect to have the older, poorer, nonsensical version selling at a price that high? And would the second Gear once again be sold for $249, or has Samsung learned its lesson?
Samsung faces an impossible decision with the Gear conundrum. It can accept defeat and have hundreds of thousands of smartwatches sit unsold on store shelves, or it can have a fire sale that drops the original Gear down to $99. Then it would face the headache of supporting a first generation product that will probably be quickly left behind by the capabilities of its successor. Were I in charge of Samsung - ha! that'll be the day - I'd just accept defeat and start over. I'd make the second Galaxy Gear less reliant on Samsung phones and introduce compatibility with all Android devices. I'd lower the price to make it more reasonable and perhaps even include it at a lower cost as part of a bundle for anyone buying the Galaxy S5. Above all, I wouldn't release it until the product was fine-tuned and ready, something Samsung clearly didn't do when it created this mess by rushing the first Galaxy Gear to coincide with the Galaxy Note 3 launch.
Andrew is MobileBurn.com's managing editor. He is based in Miami, Florida.