FORTUNE — Investors are bullish on Samsung after the Korean giant unveiled its latest flagship smartphone, the Galaxy S5, at Mobile World Congress in Barcelona this week. Shares for the company were up slightly after a 13% drop over the last year — a big deal when the company’s market cap hovers around $182 billion.
The device, which will be available in April, isn’t a huge step forward. Its camera has grown from 13 megapixels to 16; its battery is promised to last 20% longer. It will have a fingerprint sensor like Apple’s (AAPL) flagship model, which went on sale in September. Its 5.1-inch active-matrix organic light-emitting diode — AMOLED for short — display is rated for full high definition. It has a leather-like feel, which business customers may enjoy. It has a built-in heart rate monitor. And, perhaps most notably, it is said to withstand dust and 30 minutes in shallow water, a welcome improvement for slippery-fingered humans everywhere.
Water resistance aside, much of these updates are incremental and expected. This is the nature of the war waged at the premium end of the smartphone market: It’s no longer a single “killer” feature that moves units, but rather a superior experience. That the Galaxy S5 has a fingerprint sensor, for example, is a matter of relief to buyers who do not prefer Apple’s iPhone; the feature won’t encourage people to switch who are otherwise happy with their device.
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The dynamic is a blessing and a curse for Samsung. On one hand, it means the mature smartphone market in Western markets has evolved to the point where a single feature won’t shift fortunes — good news in a market in which competing companies share suppliers. On the other, it means that the company is burdened to tie those components — from the plastic shell to the screen to the software — together in a way that is distinctive and preferred.
The dynamic in emerging markets is different — particularly in China, where Samsung leads the pack and Apple believes it can find growth. There, Samsung’s challengers include Lenovo, Huawei, ZTE, and Xiaomi. The biggest pressure is economic: Low-priced phones have begun to flood the market, pressuring high-end models to join the race to the bottom. A soft economic outlook for the country complicates things, reducing the number of buyers willing to upgrade to a premium device. Indeed, most of Samsung’s growth in China has been with low-end devices — but the aspirational aura around Samsung’s brand is attributed to some of that success.
Samsung spent considerable sums of money on marketing and advertising on behalf of its previous flagship smartphone, the Galaxy S4. (According to some estimates, it spent four times more than Apple and two times more than Microsoft (MSFT) in 2012.) At the time, the company was criticized for drumming up too much hype. This time, with the Galaxy S5, it may need only to ride that goodwill and keep the top end of its portfolio stable as it wages a far more vicious battle below.
