Samsung Electronics | Samsung was founded by Lee Byung-chul in 1938 as a trading company. Over the next three decades, the group diversified into areas including food processing, textiles, insurance, securities and retail. Samsung entered the electronics industry in the late 1960s and the construction and shipbuilding industries in the mid-1970s; these areas would drive its subsequent growth.
[ Samsung Electronics ]
Following Lee’s death in 1987, Samsung was separated into four business groups :
Since 1990, Samsung has increasingly globalised its activities and electronics; in particular, its mobile phones and semiconductors have become its most important source of income. As of 2017, Samsung has the 6th highest global brand value.
Notable Samsung industrial affiliates :
Notable Samsung industrial affiliates include Samsung Electronics (the world’s 2nd largest information technology company measured by 2015 revenues, and 5th in market value), Samsung Heavy Industries (the world’s 2nd largest shipbuilder measured by 2010 revenues), and Samsung Engineering and Samsung C&T (respectively the world’s 13th and 36th largest construction companies).
Other notable subsidiaries include Samsung Life Insurance (the world’s 14th largest life insurance company), Samsung Everland(operator of Everland Resort, the oldest theme park in South Korea) and Cheil Worldwide (the world’s 15th largest advertising agency measured by 2012 revenues).
Samsung Etymology :
According to Samsung’s founder, the meaning of the Korean hanja word Samsung is “tri-star” or “three stars”. The word “three” represents something “big, numerous and powerful”.
Samsung Electronic History :
Samsung Electric Industries was established as an industry Samsung Group in 1969 in Suwon, South Korea. Its early products were electronic and electrical appliances including televisions, calculators, refrigerators, air conditioners and washing machines.
In 1970, Samsung Group established another subsidiary, Samsung-NEC, jointly with Japan’s NEC Corporation to manufacture home appliances and audiovisual devices.
In 1974, the group expanded into the semiconductor business by acquiring Korea Semiconductor, one of the first chip-making facilities in the country at the time. The acquisition of Korea Telecommunications, an electronic switching system producer, was completed at the start of the next decade in 1980.
By 1981, Samsung Electric Industries had manufactured over 10 million black-and-white televisions. In February 1983, Samsung’s founder, Lee Byung-chull, along with the board of the samsung industry and corporation agreement and help by sponsoring the event, made an announcement later dubbed the “Tokyo declaration”, in which he declared that Samsung intended to become a DRAM (dynamic random-access memory) vendor. One year later, Samsung became the third company in the world to develop a 64 kbDRAM.
In 1988, Samsung Electric Industries merged with Samsung Semiconductor & Communications to form Samsung Electronics, as before that, they had not been one company and had not been a leading corporation together, but they were not rivals, as they had been in talks for a time, until they finally merged.
Samsung Electronics launched its first mobile phone in 1988, in the South Korean market. Sales were initially poor and by the early 1990s, Motorola held a market share of over 60 percent in the country’s mobile phone market compared to just 10 percent for Samsung. Samsung’s mobile phone division also struggled with poor quality and inferior products until the mid-1990s and exit from the sector was a frequent topic of discussion within the company.
Lee Kun-Hee decided that Samsung needed to change strategy. The company shelved the production of many under-selling product lines and instead pursued a process of designing and manufacturing components and investing in new technologies for other companies. In addition, Samsung outlined a 10-year plan to shrug off its image as a “budget brand” and to challenge Sony as the world’s largest consumer electronics manufacturer. It was hoped in this way Samsung would gain an understanding of how products are made and give a technological lead sometime in the future. This patient vertical integration strategy of manufacturing components has borne fruit for Samsung in the late-2000s.
As Samsung shifted away from consumer markets, the company devised a plan to sponsor major sporting events. One such sponsorship was for the 1998 Winter Olympics held in Nagano, Japan.
As a chaebol, Samsung Group wielded wealth that allowed the company to invest and develop new technology rather than build products at a level which would not have a detrimental impact on Samsung’s finances.
Samsung had a number of technological breakthroughs, particularly in the field of memory which are commonplace in most electrical products today. This includes the world’s first 64Mb DRAM in 1992, 256 Mb DRAM in 1994, 1Gb DRAM in 1996.
In 2004, Samsung developed the world’s first 8Gb NAND flash memory chip and a manufacturing deal was struck with Apple in 2005. A deal to supply Apple with memory chips was sealed in 2005 and, as of October 2013, Samsung remains a key supplier of Apple components, manufacturing the A7 processors that are inside the iPhone 5S model.
2008 to present :
For four consecutive years, from 2000 to 2003, Samsung posted net earnings higher than five-percent; this was at a time when 16 out of the 30 top South Korean companies ceased operating in the wake of the unprecedented crisis.
In 2005, Samsung Electronics surpassed its Japanese rival, Sony, for the first time to become the world’s twentieth-largest and most popular consumer brand, as measured by Interbrand.
In 2007, Samsung Electronics became the world’s second-largest mobile-phone maker, overtaking Motorola for the first time. In 2009, Samsung achieved total revenues of US$117.4 billion, overtaking Hewlett-Packard to become the world’s largest technology company measured by sales.
In 2009 and 2010, the US and EU fined the company, together with eight other memory chip makers, for its part in a price-fixing scheme that occurred between 1999 and 2002. Other companies fined included Infineon Technologies, Elpida Memory and Micron Technology.
In December 2010, the EU granted immunity to Samsung Electronics for acting as an informant during the investigation (LG Display, AU Optronics, Chimei InnoLux, Chunghwa Picture Tubes and HannStar Display were implicated as result of the company’s intelligence).
Despite its consistent expansion, Samsung, along with its chairman Lee Kun-hee, has developed a reputation for insecurity regarding its financial stability and the potential for future crises to arise. After returning from a temporary retirement period in March 2010, Kun-hee stated that “Samsung Electronics’ future is not guaranteed because most of our flagship products will be obsolete in 10 years from now.”
The company has set an ambitious goal of reaching $400 billion in annual revenues within ten years. The company has 24 research-and-development centers around the world, and since the early 2000s and in the Vision 2020, Samsung has emphasized technical research and development. However, the large number of online complaints indicate that the company is weak at listening to customer feedback regarding the design of its technology and software.
In April 2011, Samsung Electronics sold its HDD commercial operations to Seagate Technology for approximately US$1.4 billion. The payment was composed of 45.2 million Seagate shares (9.6 percent of shares), worth US$687.5 million, and a cash sum for the remainder.
In May 2013, Samsung announced that it had finally managed to test speed-enhanced fifth generation (5G) technology successfully.
In April 2013, Samsung Electronics’ new entry into its Galaxy S series smartphone range, the Galaxy S4 was made available for retail. Released as the upgrade of the best-selling Galaxy S III, the S4 was sold in some international markets with the company’s Exynos processor.
In July 2013, Samsung Electronics forecasted weaker than expected profits for its April to June quarter. While analysts expected around 10.1 trillion won, Samsung Electronics estimated an operating profit of ₩9.5 trillion (US$8.3 billion). During the same month, Samsung acquired the media streaming device manufacturer Boxee for a reported $30 million.
Samsung’s mobile business chief Shin Jong-kyun stated to the Korea Times on 11 September 2013 that Samsung Electronics will further develop its presence in China to strengthen its market position in relation to Apple. The Samsung executive also confirmed that a 64-bit smartphone handset will be released to match the ARM-based A7 processor of Apple’s iPhone 5s model that was released in September 2013.
Due to smartphone sales—especially sales of lower-priced handsets in markets such as India and China—Samsung achieved record earnings in the third quarter of 2013. The operating profit for this period rose to about 10.1 trillion won (US$9.4 billion), a figure that was boosted by memory chip sales to customers such as Apple, Inc. On 14 October 2013, Samsung Electronics publicly apologized for using refurbished components from cheaper desktop computers to fix higher-end products, after the corporation’s unethical business practices were exposed on the previous day by MBC TV’s current affairs magazine, 2580.
Samsung provided sponsorship for the 86th Academy Awards ceremony (held 2 March 2014) and, due to the use of the Samsung Galaxy Note smartphone product by host Ellen DeGeneres in a group selfie photograph that became an online viral phenomenon, the corporation donated US$3 million to two charitable organizations selected by DeGeneres. The official Samsung statement explained: “… we wanted to make a donation to Ellen’s charities of choice: St Jude’s and the Humane Society. Samsung will donate 1.5 million dollars to each charity. ”
On 17 April 2014, Samsung had announced it was discontinuing its ebook store effective 1 July 2014 and had partnered with Amazon to introduce the Kindle for Samsung app, that will permit Galaxy device users using Android 4.0 and up to buy and read content from Amazon’s catalog of periodicals and ebooks, and a free book service, Samsung Book Deals, that will allow users of the co-branded app to choose one free ebook monthly from a selection provided by Amazon.
In February 2014, Barnes & Noble announced a new Nook color tablet would be released in 2014.
In June 2014, Barnes & Noble announced it would be teaming up with Samsung – one of the leaders in Android-based tablets – to develop co-branded color tablets titled the Samsung Galaxy Tab 4 Nook; the devices will feature Samsung’s hardware, including a 7-inch display, and customized Nook software from Barnes & Noble. The first Galaxy Tab 4 Nook will begin selling in the US in August 2014, with Nook focusing on the software and content, and Samsung focusing on the hardware.
The product specs posted by Samsung indicate that, in contrast to the premium quality enhanced ereaders launched in 2012 (the NOOK HD and HD+, which “had screens and CPUs comparable to the best mid-level and premium tablets), the more budget-like features of the Samsung Galaxy Tab 4 Nook will be designed for a lower market tier (Android 4.4.2 KitKat on a 1.2 GHz quad-core Snapdragon CPU with 1.5GB RAM, Wifi, and Bluetooth, in addition to a 1.2MP front-facing camera and a 3MP rear camera, screen resolution of 1280 x 800, and a $199 retail price; roughly $80 more than comparable tablets that don’t carry a Samsung brand).”
In reporting on Barnes & Noble’s 5 June 2014 announcement that the bookseller would be teaming up with Samsung to develop Nook tablets, the Associated Press noted:
“Barnes & Noble says it will continue to make and sell its $99 Nook Glowlight[sic] e-readers and provide customer support.”
“The company also says it is moving its Nook employees out of its Palo Alto, Calif., offices to save money. Employees are expected to move to a smaller space in nearby Santa Clara, Calif., by July.”
In Q1 2015, Samsung’s profit dropped 39% to USD4.35 billion due to heavier smartphone competition from Apple’s iPhone 6 and 6 Plus, as well as a slew of Android competitors.
In May 2015, Samsung announced a partnership with IKEA, in accordance with the Wireless Power Consortium, to co-develop furniture that would allow Qi inductive charging at the Mobile World Congress. In June, Samsung established a dedicated LFD business, Samsung display solutions, catering to the company’s SMART range of LED products. The company’s SMART range of LED displays include Signage, Hospitality Display, TV, LED, Cloud Display, and Accessories. The company provides the following all-in-one customer software solutions: MagicInfo, MagicIWB, LYNK SINC, LYNK HMS, and LYNK REACH. The company caters to the following industries: Retail, Corporate, Corporate, Hospitality, and Transportation.
On 16 June 2016, Samsung Electronics announced that it has agreed to acquire cloud-computing company Joyent. It will allow it to grow its cloud-based services for its smartphones and Internet-connected devices.
On 14 November 2016, Samsung Electronics announced an agreement to buy American automotive equipment manufacturer Harman for US$8 billion. On 10 March 2017, the acquisition was completed. On 6 April 2017, Samsung Electronics reported that financials were up for the company in the quarter. The year prior, “memory chips and flexible displays accounted for about 68 per cent of Samsung’s operating profit in the final quarter of 2016, a change from previous years when the smartphone business was the main contributor.”
On 2 May 2017, Samsung has been given permission from The Ministry of Land, Infrastructure and Transport of Korea to start testing a self-driving car technology. According to the Korea Herald, the company will be using a customized Hyundai car for the tests.
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