Galaxy Note 7 Breaks Pre-Order Records, Should Apple Be Worried?

The Galaxy Note 7 is off to a very fast start, with more than 200,000 people pre-ordering the phablet in the first two days. According to the Korea Herald, this outpaces the pre-order numbers for the Galaxy S7, which has become the top-selling Android phone and is our top smartphone pick overall.

Should Apple be worried about the Note 7's early momentum? There's certainly a lot at stake in the phablet portion of the market, which according to IDC grew 86.9 percent from 2014 to 2015, reaching 291 million units.

Samsung's 5.7-inch device has a lot going for it, including a water-resistant design, improved S Pen and iris scanning security. Meanwhile, the iPhone 7 Plus will likely fight the Note 7 with a dual-lens camera, fast new A10 processor and perhaps a new Smart Connector, but based on various reports it will sport the same 5.5-inch screen with a ho-hum 1080p resolution.

"Apple has been very public in saying that there was going to be a decline in smartphone volumes heading into this year," said Ramon Llamas, research manager for wearables and mobile phones for IDC. "Last year Apple took over as the leader in the phablet market, but it was by the slimmest of margins."

For Llamas, the biggest threat for Apple isn't necessarily the Note 7, but the company's older and less expensive phablets. "You're talking about an $800-plus device," he stressed. "You may want to go with something older that may not have the latest and greatest bells and whistles, but it's going to be cheaper."

There's also concern that the iPhone 7 Plus just won't be exciting enough to justify its own premium price, especially since Apple now offers a "good enough" phone under $400 in the iPhone SE.

"With Apple's writing on the wall about declining volumes I have to think that some of that is going to be felt in the phablet portion as well," Llamas added. "The iPhone SE is doing pretty OK and is probably taking some momentum away from larger screen devices."

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