By Motoko Rich
With Samsung following Apple in suspending all shipments to Russia, two companies that together account for about half of all smartphone sales in the country have now paused distribution to Russian buyers.
Samsung, the South Korean technology giant, made its announcement in a statement Saturday. When Apple said earlier this week that it was suspending sales in Russia, the company drew praise on Twitter from Ukraine’s minister of digital transformation, Mykhailo Fedorov.
The moves are part of a wider exodus of companies from Russia after its invasion of Ukraine, one that has encompassed brands in automobiles, luxury retail and many other sectors.
For big technology firms, Russia is a relatively small cellphone market. Sales there account for less than 3% of all smartphone units shipped around the world, according to market research by the International Data Corp.
But the recent moves by Apple and Samsung are enormously symbolic, said Michael S. Bernstam, a research fellow at the Hoover Institution at Stanford University. Among “people of all income groups and ethnic groups and cities and towns across Russia, they will know that their government received a slap in the face,” he said. “This is a very important message.”
Russian buyers will still be able to buy from Chinese company Xiaomi, which sold just over one-quarter of all smartphones in Russia in the third quarter of last year, according to IDC.
The lost sales in Russia are not much of a sacrifice for international smartphone manufacturers, but the potential reputational damage of continuing to sell there could be much more significant, said James S. O’Rourke, a professor of management at the Mendoza College of Business at the University of Notre Dame.
“Your brand is judged in many ways by who buys it, who uses it, who you are in business with, who you are partners with,” he said. “You don’t want Vladimir Putin’s photo on your package.”