For a company to define its competitive advantage it needs to follow a series of steps in analyzing its industry environment and business characteristics that will determine its strengths, which have the potential of becoming it's sustainable competitive advantage. In order to maintain this competitive advantage, a firm needs to be active and innovative, but also never lose focus on the actions of its closest competitors. The mobile phone industry comes with a vast range of opportunities. By looking at ongoing competitive trends within this industry, there is no doubt that innovation is the most important strength and is the most mentioned competitive advantage. The companies with today's highest market share tend to invest a lot in research and development, and therefore bomb the market with new innovative products frequently. Because of brand popularity, more known firms will tend to have it easier to stay in a leading position longer, even though less known firms challenge them with new innovative mobile phones. So far, Samsung is keeping its leading position in the mobile phone industry, but it's only a matter of time both Apple and Samsung will have to make drastic improvement in order to compete with their upcoming Chinese rivals. Latest figures show that these current market leaders have been struggling with market share, while market share of competitors have seen an increase in the last couple of years. Even though technological advancement within this industry has been impressive, a lot of room has been left for improvement. The mobile phone industry is extremely dynamic so there is no doubt that improvement will appear, especially as every firm is competing in introducing new advanced features. Because of the intense competition and constant technological improvement, a dominant design has not yet emerged and will constantly be delayed. The mobile phone industry is currently one of the fastest growing industries in the world and will continue to see growth in the future. This industry has taken over aspects of the whole electronic industry making it hard for firms to focus only on competitors within a specific market. The case study on Apple and Samsung shows us that currently Samsung is the best mobile phone manufacturer in the world, with aggressive reactions to impending competitors and effective strategies that has given this company stable success. To the contrary, Apple has not been as active lately and this may be the reason it has taken second place. In order to keep their leading positions in the future, Samsung and Apple have to expand their outlook and focus their efforts on the rapidly rising competition.