Samsung Electronics

Company structure

As of December 2021, Samsung Electronics has two main divisions:

• SET Division (smartphones and consumer electronics);
• DS Division (semiconductor products).

Business in Russia

Main article: Samsung Electronics Rus

Performance indicators

Main article: Samsung Electronics financials

History

2024

50% cut in contract chip production due to low demand

In early November 2024, it became known that the leading South Korean chipmaker Samsung is cutting contract production by 50% amid lower demand for chips from American and Chinese companies.

Analysts estimate Samsung's semiconductor business recorded a loss of 1 trillion won in the third quarter of 2024, prompting the company to take cost-cutting measures. Samsung Electronics has already shut down more than 30% of its 4nm, 5nm and 7nm chip lines on Line 2 (P2) and Line 3 (P3) of the Pyeongtaek plant and plans to shut down up to 50% of its facilities by the end of the year. The cessation of production will be carried out gradually so as not to delay customer orders.

Samsung slashes contract chip production by 50% due to low demand

Although Samsung previously publicly stated that it would keep all production lines, only reducing the burden on them, in the end the company decided that a complete shutdown of unnecessary lines to reduce electricity costs would be more effective. The reason was a drop in demand from Chinese companies, which previously purchased a significant share of Samsung's 4nm and 5nm processes. U.S. trade restrictions on Chinese semiconductor imports have led some Chinese companies to delay their projects ahead of the U.S. presidential election, affecting other manufacturers as well.

Some experts worry that Samsung's cost-cutting measures could undermine its competitiveness in the foundry sector.

Since Samsung Electronics focuses on the production of memory chips, the foundry business has been sidelined, says Professor Lee Jeong-hwan of Sanmyeong University. - With the shutdown of a number of production lines, the growing gap with TSMC could reach a point where Samsung will become extremely difficult to catch up.[1]

Thousands laid off due to lack of money

In early October 2024, it became known about Samsung's decision to cut thousands of jobs amid difficulties in the AI market. Layoffs will begin with countries in Southeast Asia, Australia and New Zealand.

Layoffs can affect about 10% of the workforce in these markets, although the share of job cuts in specific subsidiaries can change. The South Korean company has about 147,000 overseas employees, who make up more than half of the total workforce exceeding 267,800. The company does not plan to conduct layoffs in its domestic market.

Samsung Store

Some foreign subsidiaries are making planned personnel adjustments to improve operational efficiency, a Samsung spokesman said. - The company did not establish the exact number of abbreviations for specific items.

Samsung shares are down more than 20% this year as the world's largest maker of memory chips and smartphones has struggled. The company lagged behind rival SK Hynix Inc. in manufacturing memory chips used to power AI, and made little progress compared to Taiwan Semiconductor Manufacturing Co. in manufacturing chips for third-party customers. Against this background, Samsung abruptly changed the head of the chip business, and a newly appointed executive, Joon Young-hyun, warned that the company would have to change the culture of jobs in order not to fall into a "vicious circle."

Samsung is likely to try to preserve manufacturing jobs by cutting management and support functions, the source said. Specific figures will be influenced by local labor laws and financial priorities. It is known that one of the Samsung unions announced the first strike in the history of the company back in May 2024^[1]

Samsung and LG TVs take a screenshot of what you're watching every second. Data is received by advertisers

At the end of September 2024, it became known that smart TVs Samsung and LG take several screenshots of what viewers are watching every second. This information is then used to target ads. More here

Police arrest two ex-Samsung executives for draining technology to China, on which the company spent $3.2 billion

On September 10, 2024, it became known that South Korean police arrested two former Samsung executives who are suspected of transferring confidential information to China. We are talking about the drain of Samsung technologies, which caused the company damage in the amount of $3.2 billion.

It is said that the detainees collaborated with Chinese officials in order to build a factory for the production of semiconductor products in China. One of those arrested, a 66-year-old man named Choi, hired South Korean chip specialists and handed over Samsung memory technology to the Chinese side through a joint venture, Chengdu Gaozhen. Choi served as the head of this organization, and the plant designer named O (Oh) helped him. It is said that the two of them assisted the Chinese authorities in organizing the production of DRAM memory chips using 20nm technology.

Former top Samsung managers arrested for transferring technology to China, on which the company spent $3.2 billion

In a statement, South Korean law enforcement agencies said that the actions of ex-Samsung executives not only damaged this company, but also "weakened the competitiveness of the country as a whole against the backdrop of the global race in the field of semiconductor microchips." The police also note that the activities of the Chinese enterprise, to which Samsung's proprietary developments were transferred, were suspended, but further investigation of technology leaks continues.

Information on when exactly Samsung technology was leaked to China has not been disclosed. However, some details of the investigation point to events in 2023, when sanctions targeting China's chip-making sector strained relations between Beijing and Washington. Then one of the leaders of Samsung was detained on suspicion of stealing confidential documentation.^[2]

250 fires and dozens of injured people. Samsung recalls 1.12m defective ovens

In early August 2024, Samsung recalled more than 1.1 million ovens sold, which caused 250 fires, resulting in dozens of injuries and the death of at least seven pets. Read more here

Samsung forces service centers to leak customers' personal data to companies

At the end of April 2024, it became known that Samsung requires independent service centers to transfer to it personal data about the owners of smartphones that have applied for repair services. Moreover, workshops are obliged to notify the South Korean company of the detection of components purchased in the secondary market in the devices of customers bypassing official channels.

About the practice of Samsung told the resource 404 Media, which, allegedly, received at its disposal a copy of the contract between this company and a certain independent service for the repair of gadgets. The document says that with "every repair" of this manufacturer's smartphone, the workshop must send Samsung the name, address, unique serial number of the device, IMEI, a list of customer complaints and all the details of the work performed.

Samsung requires independent service centers to transfer personal data about smartphone owners to it

The contract also says that if there are parts in the repaired device that have not been officially purchased from Samsung, they must be "immediately" dismantled. If these requirements are not met, Samsung threatens to terminate the contract with the service center. Resource 404 Media claims that it "confirmed the authenticity of the contract," but Samsung does not give comments as of May 23, 2024.

As noted, the use of spare parts obtained in the secondary market is a fairly common practice in workshops. This allows you to reduce the cost of repairs, as well as find components that can be discontinued. Samsung, on the other hand, requires independent service centers not only to dismantle such parts, but also to inform the company about this. Moreover, in this case, Samsung requires workshops to transfer an extensive set of personal data of customers, which in the event of a leak may well be used in various fraudulent schemes.^[3]

Romania fine for colluding with retailers to inflate prices on smartphones and TVs

On February 8, 2024, the Romanian Competition Council announced the imposition of a record fine on the local unit of Samsung Electronics for collusion with retailers. The total amount of recovery is 123 million Romanian lei (approximately $26.45 million at the exchange rate as of February 14, 2024).

It is noted that Samsung has entered into a conspiracy with three trading partners in Romania - Dante International (owns the eMAG network), as well as electronics retailers Altex and Flanco. The listed companies, according to the regulator, entered into an agreement in order to inflate prices for smartphones and TVs. As a result of this anticompetitive behavior, buyers were forced to overpay for certain consumer goods. This practice operated from 2019 to 2021.

Romanian Competition Council announces record fine imposed on local Samsung Electronics unit for collusion with retailers

The Romanian Competition Council fined Samsung 75.4 million lei (approximately $16.21 million). For Dante, Altex and Flanco, the amount of penalties amounted to 20.3 million lei ($4.36 million), 21.4 million lei ($4.6 million) and 6.2 million lei ($1.33 million), respectively.

The regulator's conclusion says that due to an anti-competitive agreement with Samsung, retailers could not independently regulate prices for a number of TV models and smartphones from the South Korean manufacturer. That is, in fact, all three retail chains imposed Samsung products on consumers at a predetermined cost. Meanwhile, Romanian law prohibits agreements between companies or coordinated actions that "impede, restrict or distort competition in the market." The investigation was initiated after receiving an anonymous complaint through a specialized platform to inform the Romanian Competition Council about illegal activities. This service allows citizens to send notifications about possible violations in the market.^[4]

Participation in the creation of a semiconductor cluster in South Korea for $471 billion

South Korean companies with Samsung Electronics and SK Hynix are investing 622 trillion won (about $471 billion at the exchange rate at the time of the article's release - January 16, 2024) in the production of chips. South Korean President Yoon Seok-yol spoke about the plans of local producers, speaking at an event at Songyungwan University.

According to Bloomberg, citing a statement by the head of state, Samsung Electronics and SK Hynix will create the "world's largest semiconductor cluster" of several dozen enterprises in the vicinity of Seoul. Another 13 enterprises and three research centers will be added to the existing 21 plants. It is expected that by 2030 7.7 million integrated circuits for semiconductors will be produced here.

Samsung Electronics is going to invest $378 billion in the development of its enterprises in South Korea until 2047. This manufacturer will try to increase the share of revenue received from the manufacture of chips commissioned by third-party companies. SK Hynix will invest $92 billion in the development of its memory chip production in Yongying over the same period.

According to the leadership of South Korea, small developers of chips and semiconductor materials will appear in the semiconductor cluster, thanks to which the country will become more self-sufficient in terms of chip production and will be able to increase their supply abroad.

By the beginning of 2024, semiconductor products occupy 16% of South Korea's export structure, but their share in the world market does not exceed 3%. By 2030, this figure is planned to be increased to 10%. Although the country's authorities are not ready to allocate direct subsidies for the development of the semiconductor industry, they provide generous tax deductions, which sufficiently stimulates manufacturers, which will increase their capacities without doing so, the agency notes.^[5]

The mother and sisters of the head of Samsung Electronics sold shares of the company for $2 billion

On January 10, 2024, it became known that the family of the founder of Samsung sold shares in the conglomerate companies for approximately $2 billion. The funds were needed to pay part of one of the world's largest inheritance taxes.

The son of Samsung founder Lee Kun-hee died in 2020, and the inheritance tax for the family was estimated at more than $10 billion. This amount must be paid in six tranches over five years. To partially pay the tax, relatives were forced to put up for sale several rare paintings by Picasso and Monet in 2021.

According to reports, the payment Bloomberg of the next tranche required the sale of shares in the companies of the conglomerate Samsung. In particular, approximately 30 million Samsung Electronics securities worth about $1.64 billion were sold. In addition, shares of IT service provider Samsung SDS, construction company Samsung C&T and insurer Samsung Life Insurance were sold: the cost of all these packages is estimated at $405 million. Thus, the total value of the realized assets is $2.05 billion.

The securities were sold by KEB Hana Bank on behalf of a trust for some Samsung family members who needed funds to pay inheritance tax. Goldman Sachs Group, Citigroup Inc., JPMorgan Chase & Co. and UBS Group AG are the registrars of the paper deal with Samsung Electronics. Goldman Sachs and Citi became registrars of Samsung SDS, Samsung C&T and Samsung Life Insurance stock deals.

It is our civic duty and responsibility to pay all taxes, Lee's relatives claim.

It is also noted that the amount of this tax "is one of the largest in Korea and around the world." Lee's relatives also announced their intention to make a number of charitable donations.^[6]

2023

Former Samsung employees have become millionaires by selling top-secret memory manufacturing technology to China. They are arrested

On December 15, 2023, two former Samsung employees were arrested in South Korea. They are suspected of selling intellectual property to China regarding technologies for producing DRAM RAM chips. The damage is estimated at billions of dollars.

The detainees are in the case as Mr Kim and Mr Bang. The National Intelligence Service of South Korea (NIS) suspected them of transferring trade secrets to another state in May 2023. According to investigators, these Samsung-related individuals left for China, where they worked for the local company Changxin Memory Technologies (CXMT), which specializes in the development and production of microcircuits. The suspects allegedly transferred intellectual property to CXMT to release DRAM chips based on a 16nm process technology.

Kim and Bang are alleged to have made "several million dollars" for sharing secret Samsung developments with the Chinese. At the same time, the prosecutor's office claims that the total damage from information leakage is about 2.3 trillion Korean won (approximately $1.8 billion at the exchange rate as of December 19, 2023). With classified data at its disposal, CXMT can significantly close the technological gap with Samsung, the equivalent of years of research and development.

As of mid-December 2023, information about the suspects in the interests of the investigation was not disclosed. Kim, who retired in 2016 and subsequently moved to CXMT in China, is known to have worked full-time for Samsung. In turn, Bang was a subcontractor to Samsung. CXMT, in connection with the investigation, said it "respects intellectual property rights" and had a "robust mechanism to prevent incidents" involving sensitive information.^[7]

Several Samsung employees received prison sentences for transferring technology to competitors from China

In the second half of February 2023, it became known that a court in South Korea found seven former Samsung employees guilty of stealing technology related to the production of semiconductors and transferring them to competitors from China. Read more here.

Theft of 2.4 GB of employee data

In early January 2023, the hacker group Genesis Day claimed responsibility for hacking into Samsung's internal servers and said it had attacked the company in response to South Korea's cooperation with NATO.

The attackers posted the ad on a hacker forum, claiming they had infiltrated Samsung's computer systems. According to hackers, they found a way to the internal FTP service used by Samsung in South Korea.

The sample data, which was investigated by information security specialists with Cybernews, presumably includes Samsung's corporate logon guides, employee passwords and several training videos. The attackers tried to build on the success by promising to merge another 2.4 GB of data stolen from the South Korean conglomerate Samsung.

As South Korea has recently strengthened cooperation with NATO and targeted other countries. We hacked Samsung's internal FTP service in South Korea. We are not against a massive network failure in South Korea if they continue to take targeted action. This is just the beginning, the Genesis Day hackers said.

On January 17, 2022, the New York Times wrote that the Republic of Korea refused to supply artillery shells to Ukraine because it would violate arms export rules. Instead, the government in Seoul chose to help the U.S. replenish its supplies in other countries. But already in November 2022, South Korean President Yun Sok El, during a speech at the East Asian summit in Phnom Penh, promised to increase military assistance to Ukraine in connection with Russia's special military operation on Ukrainian territory.

CyberNews calls the Genesis Day hacker group "pro-Russian."^[8]

2022

Lee Jae-young leads Samsung

At the end of October 2022, the grandson of the founder of the South Korean conglomerate Samsung Electronics, Lee Jae-young, officially headed Samsung Electronics, his candidacy was approved by the company's board of directors. Read more here.

On April 12, 2022, Samsung Vice President and de facto head Lee Jae-young received a pardon from South Korean President Yoon Suk-yeol, clearing him of convictions for a massive corruption scandal that sparked nationwide protests in 2017 and revitalizing a crucial player in the South Korean economy.

Recognition in the leakage of data of users of gadgets

On September 4, 2022, Samsung confirmed a data breach that occurred at the company two months earlier. As a result of the incident, the attackers gained access to the personal information of the owners of smartphones, televisions and other electronics of the South Korean company.

The breach was discovered by Samsung on August 4, 2022. The company began sending emails to those affected by this cybersecurity incident. Samsung information security specialists emphasize that data leakage can be different for each user. The company said the data breach did not leak credit or debit card numbers, nor were Social Security numbers compromised.

In its statement, Samsung mentions that data leaked as a result of the breach may include name, contact, date of birth, production and demographic information about customers. The company also says it has taken steps to protect affected systems. As of September 5, 2022, a full investigation is underway to establish the cause of the hack. Samsung has enlisted an external cybersecurity firm to help with the investigation, and the company is also cooperating with law enforcement on the matter.

Customers affected by this data breach are informed by Samsung via email. If a user receives one of these emails, be sure to follow all the instructions in it to protect their data. Finally, the company regrets any concern or inconvenience caused by this incident in its customers.

While it may be comforting that information about payments or social security was not leaked, it does not make the incident less dangerous. Information leakage can be used by hackers to carry out socio-engineering attacks. Samsung doesn't recommend users change their passwords immediately, but it says any unusual activity on your account should be monitored. The company has set up a FAQ page to provide further guidance to customers who may have been concerned about this incident.^[9]

Launch of mass production of 3nm chips

In late June 2022, Samsung launched mass production of the world's first 3nm chips, which are more powerful and efficient than their predecessors. The semiconductors will be designed for high-performance and specialized computing equipment with low power consumption, and then the company will switch to mobile processors, the company said in a statement.

Using a technology called Gate-All-Around (GAA) transistor architecture, Samsung's 3nm (nm) products reduce power consumption by up to 45% and increase performance by 23% compared to 5nm chips. The company will manufacture 3nm chips at its Hwason facilities and is expected to launch production at its Pyeongtaek plant. Mass production of chipmaker chips will begin in the second half of 2022.

Samsung's patented technology uses nanowires with wider channels that provide higher performance and energy efficiency compared to GAA technologies using nanowires with narrower channels. Using GAA technology, Samsung will be able to adjust the nanolayer channel width to optimize power consumption and performance to meet different customer needs.

Samsung is growing rapidly as we continue to show leadership in applying next-generation technologies to manufacturing, such as the foundry's first High-K metal shutter, FinFET, as well as EUV. We aim to continue this leadership by creating the world's first 3nm process technology with MBCFET. We will continue to actively innovate in the development of competitive technologies and create processes that will help accelerate the maturity of the technology, "said Siyoung Choi, President and Head of Foundry Business at Samsung Electronics.

As technology nodes decrease and chip performance requirements increase, IC developers face the challenges of processing vast amounts of data to test complex products with more features and tighter scaling. To meet such requirements, Samsung is committed to providing a more stable design environment that will help reduce the time required for design, verification and signing process, as well as improve product reliability.^[10]

Toshiba, Sony and Samsung will pay tens of millions for cartel collusion in the sale of disk drives

On June 16, 2022, it became known that Toshiba Samsung Storage Technology, Sony, Sony Optiarc and Quanta Storage lost a lawsuit with the EU and must pay fines totaling €116 million ($120.5 million). Read more here.

Building a company to develop robots and products for metaverse

In mid-March 2022, South Korean tech giant Samsung created a company to develop robots and metaverse solutions, Samsung Device Experience. Read more here.

Samsung stole 190 GB of source code for device software

On March 7, 2022, Samsung confirmed the fact of a data leak, as a result of which confidential information was stolen. In total, hackers stole 190 GB of data, most of which is the source code of the software for the devices.

According to SiliconANGLE, the attack was carried out by the hacker group Lapsus $. Among the stolen confidential information is the source code of each trusted applet (TA) installed in the Samsung TrustZone environment, used for confidential operations such as encryption and access control. We are also talking about implementations of algorithms for all biometric unlocking operations, bootloader source code for all recent Samsung devices, Qualcomm confidential source code, Samsung activation servers source code for the full source code of the technology used to authorize and authenticate Samsung accounts, including APIs and services. If the information given is correct, the leak can cause huge damage to Samsung.

Trojan apps that collect contacts and credentials from other apps, such as banking apps, are fairly common on Android, but the ability to hack into a phone's biometric data or lock screen has been limited to highly funded threat actors, including government espionage. Leaking source code can make it much easier for less-funded threat actors to carry out more complex attacks on Samsung's most secure device features, said Casey Bisson, head of product and code protection at BluBracket.

The form of the attack, which stole data from Samsung, is not specified. Lapsus $ is known for its ransomware attacks, but this is not the only type of attack that involves a group of hackers. While the positive for users is that personal information has not been stolen, Samsung's source code theft is still a pretty serious development^[11]

2021

Jung Hee-han's appointment as head of Samsung's smartphone and consumer electronics division

On December 7, 2021 Samsung , Electronics announced the merger of its production smartphones and consumer divisions. As electronic engineers a result of the merger of these assets, a structure called SET Division was created, headed by the ex-head of Samsung's display business. Jong-Hee Han More. here

Construction of a plant in the United States for $17 billion

On November 24, 2021, Samsung Electronics announced the construction of a new semiconductor plant in Texas. It is planned to invest $17 billion in it, which is the company's largest investment in the United States.

The new facility, which will be located in the Texas city of Taylor, plans to launch chips for advanced technological processes designed for applications in areas such as mobile communications, 5G networks, high-performance computing and artificial intelligence.

The object will be located on an area of ​ ​ 5 million square meters. m. About 2 thousand workplaces will be created there. The commissioning of the plant is scheduled for the second half of 2022.

By increasing production capacity, we will be able to better meet the needs of our customers and contribute to the stability of the global supply chain of semiconductor products, said Kinam Kim, executive director of Samsung Electronics Device Solutions.

He thanked the administration of US President Joe Biden "for creating an environment that supports companies such as Samsung in expanding advanced semiconductor production in the United States."

According to The Wall Street Journal, Samsung considered Arizona, New York, Florida, as well as the Texas capital Austin as possible location options. To attract the corporation, Taylor proposed a number of benefits, including a property tax of up to 92.5% within the first 10 years, sources say.

The town of Taylor, with a population of 16,000, has been chosen as the site for the new plant, in particular because there is another Samsung manufacturing facility 25km away - in Austin. The proximity of the two businesses will allow them to share infrastructure and resources.^[12]

Samsung head sent to prison for 2.5 years for bribes

On January 18, 2021, Samsung Electronics Vice President Lee Jae-yong, who is the de facto head of the Samsung Group conglomerate, was sentenced to 2.5 years in prison for corruption. Read more here.

2020

Samsung and SK Hynix stop supplying chips for Huawei

On September 9, 2020, it became known about the decision of Samsung Electronics and SK Hynix to stop supplying memory chips to Huawei due to US sanctions imposed on the Chinese manufacturer of telecommunications equipment and mobile devices. South Korean partners will break off cooperation with Huawei in mid-September 2020. Read more here.

Build your cloud infrastructure

In March 2020, it became known about the creation of Samsung's own cloud infrastructure. With this project, the South Korean giant intends to reduce its dependence on Amazon and its cloud services.

According to SamMobile, by March 2020, about 60% of Samsung's cloud services are based on the Amazon Web Services (AWS) infrastructure, and the remaining 40% are based on products from other cloud providers. Samsung intends to develop its cloud infrastructure to reduce costs and improve the security of the services provided.

At the first stage, Samsung will transfer division projects to its own cloud infrastructure, and then, as it achieves stable operation, the company will migrate its main products. The ultimate goal is to launch all of its cloud services based on proprietary infrastructure.^[13]

Every year, Samsung pays Amazon hundreds of millions of dollars to use AWS. In 2019 alone, such expenses of the South Korean corporation reached $483 million. As the number of smart home devices grows, which Samsung itself releases and also connects to its ecosystem (third-party hardware), the need for cloud infrastructure is expected to grow exponentially.

By March 19, 2020, Samsung has not decided which structure within the company will develop the cloud direction. At the same time, it is known that the IT company Samsung SDS, which owns four data centers in South Korea and 13 in other countries of the world, is developing its own private cloud services.

It is possible that Samsung may use Joyent, an American cloud company that was acquired in 2016 to create its cloud infrastructure. If the South Korean giant stops using AWS, it would be a major blow to Amazon.

As of January 2020, Samsung Electronics has three main divisions:

Company Structure - 3 Divisions

• Consumer Electronics: TVs, monitors, printers, air conditioners, household appliances;
• IT & Mobile Communications: computers, phones, digital cameras;
• Device Solutions: includes two divisions - semiconductor (produces memory chips and processors) and display (produces screens for electronics).
• Harman (production of audio equipment under the Harman brand).

2019

Collusion in HP Drive Sales

In early January 2020, HP Inc. sued $439 million from Taiwanese drive supplier Quanta Storage for conspiring with Samsung, Sony and Panasonic to inflate prices. The US court ruled to make up for the losses that HP suffered as a result of these frauds in triple amounts. Read more here.

Three Samsung Electronics executives sent to jail

On December 9, 2019, the Seoul Central District Court sentenced three Samsung Electronics executives to prison terms for destroying evidence during an investigation related to falsification of financial statements.

The vice president of Samsung Electronics, who was responsible for the company's finances, received two years in prison, two other defendants were sentenced to one and a half years in prison.

According to investigators, the management gave instructions to employees to forge internal documents of Samsung BioLogics (along with Samsung Electronics is part of the Samsung Group conglomerate) and personally took part in this since May 2018. In 2015, Samsung BioLogics, through fraud, overestimated its own value by 4.5 trillion Korean won ($3.78 billion).

During the trial, prosecutors said Samsung employees were involved in "the biggest crime of evidence destruction in South Korean history." Prosecutors demanded a more severe punishment - up to four years in prison.

Nearly two dozen desktops, laptops and servers were hidden in spaces beneath the floors of Samsung Biologics factories near the capital Seoul, according to the investigation.

The audacity of the defendants goes beyond the imagination and stuns the public, "said the judge who sentenced Samsung employees.

Most South Koreans want Samsung to... became the world's largest company contributing to the development of the country's economy. However, if such growth is based on violations of laws, it will not be welcomed, he said.

According to the Yonhap news agency, this verdict concerned only concealment of evidence by executives, the investigation into financial fraud itself will continue.^[14]

Dirt at Samsung plant forces us to destroy millions of dollars worth of chips

In mid-November 2019, Samsung's DRAM chip division faced a number of problems due to undiagnosed contamination on time. A few weeks ago, several of the Samsung plant's cleanrooms were contaminated, followed by contamination of all the tools needed to make DRAM chips. The company was forced to destroy the chips produced at a loss of several million dollars.

Room cleanliness is important for the semiconductor manufacturing process because silicon chip elements must be completely protected from contaminants to ensure accurate operation. However, Samsung failed to maintain cleanliness at the DRAM production workshop, working with 200mm DRAM 1xnm chip plates. The tools used to process the plates were contaminated, and foreign substances from them fell on the plates themselves.

According to media reports, the recent contamination incident affected a small Samsung electronics plant in the Korean district of Guilleng. Contamination is suspected to have affected the entire plant, or at least products from the DRAM production shop. Samsung admitted that the plant lost several billion South Korean won, that is, several million US dollars. However, the company assured that the destruction of contaminated chips will not have a significant impact on the DRAM market, since production has already been established and the problem has been resolved. At the same time, an insider from the chip industry who spoke to Business Korea believes that Samsung may underestimate the financial damage and overall damage to the market.

Samsung is not the only company affected by the contamination of production - at the beginning of 2019, TSMC also faced pollution that damaged at least 10,000 plates and cost TSMC $550 million in losses.^[15]

Innovation Strategic Partnership Development Agreement with Microsoft

On August 8, 2019, the companies Microsoft Samsung and announced the development of a long-term strategic partnership in the field of innovation. Starting Samsung Galaxy Note10 with performance applications and services, Microsoft will are integrated be included in the products of the line, including the function of automatic synchronization with Link PERSONAL COMPUTER to,,,, Windows OneDrive as well as Outlook, and. Word Excel PowerPoint More. here

Plastic Packaging Waiver

On January 27, 2019, Samsung announced the abandonment of plastic packaging. The company promises to switch only to environmentally friendly materials.

Instead of the plastic boxes in which Samsung places its phones, tablets and accessories for later sale in stores, the company will start using paper and recycled plastic in early 2019.

To modernize product packaging, Samsung Electronics has formed a task force that will be responsible for the design and development, procurement, marketing and quality control of innovative packaging ideas, the South Korean electronics manufacturer said in a statement.

Samsung also said plastic bags used to protect large-sized devices such as TVs and refrigerators would be replaced with "packages containing recycled materials and bioplastics that are respectively made from plastic waste and non-fossil fuels such as starch or sugarcane."

Samsung's gadget box cradle will be made of molded pulp, and the company will completely refuse the transparent plastic film, which is usually pasted over chargers. At the same time, the power adapters themselves will have not a glossy, but a matte surface.

In terms of paper, Samsung is going to use only fiber materials certified by international environmental organizations in packaging and manuals from 2020.

Samsung also pledged to collect 7.5 million tons of the company's spent devices by 2030 and use 500 thousand tons of recycled plastics.

Samsung Global Customer Satisfaction Center chief Kyung-bin Jeon says the company is working to minimize waste while acknowledging society's "environmental concerns such as resource depletion and plastic waste."^[16]

2018

Investing in Graphcore AI Processor Developer

In December 2018, it became known that the developer of processors for AI applications attracted Graphcore about $200 million in investments. According to the results of this round of financing, the company was valued at $1.5 billion. Major companies such as,, and Microsoft BMW Dell Samsung Electronics invested in Graphcore. More. here

Samsung: Huawei's problems will help us get out of the outsiders of the telecom equipment market in the 5G era

In December 2018 Samsung Electronics , she expressed hope for the company's exit from the outsiders of the telecommunications equipment market due to failures. Huawei The problems experienced by the Chinese manufacturer are in the hands of the South Korean company on the eve of the mass launch of fifth-generation networks (). 5G

As you can see in the diagram below, at the end of 2017, Huawei became the world's largest manufacturer of equipment for telecommunications networks: the company's share was 28% versus 3% for Samsung, which took fifth place in the overall standings.

However, the dominant position of the Huawei is under threat due to the boycott of several countries, which are afraid to use the equipment of the Chinese company to prevent espionage, shutdown of systems and, as a result, loss of customers. Huawei itself has repeatedly denied any involvement in the spying activity.

From a strategic point of view, these problems help us increase market share, "said Abraham Kim, vice president of Samsung's mobile division, at a conference in Seoul on December 12, 2018. - Huawei has dominated the network market since the LTE era, but we are ahead in the 5G technology that goes into smartphones.

Samsung has a chance of getting orders for 5G equipment from top telecoms companies that are ditching Huawei technology. Thus, the largest British operator BT in December 2018 said that since 2016 it began replacing Huawei devices in its 3G and 4G networks with products from other manufacturers, and when purchasing devices for 5G networks, Chinese companies are excluded as suppliers.

Samsung promises to launch the first 5G-enabled smartphones in the first half of 2019. According to rumors, such technology will be implemented in the flagship Samsung Galaxy S10.^[17]

Plant closures due to China's expensive workforce

On December 12, 2018 , Samsung Electronics announced the closure of one of its factories in China - Tianjin Samsung Electronics Telecommunications (TSTC). The main reasons for this decision are associated with falling sales of smartphones and the relative high cost of labor in the Celestial Empire. Read more here.

Payment of up to $132 thousand to each employee who is sick due to work

On November 1, 2018, Samsung Electronics announced the payment of compensation to employees injured in production. Thus, the company settled a long-term dispute with a group of lawyers representing the interests of workers and their families, who were somehow affected by the problem of difficult working conditions.

Former or existing workers at Samsung display and chip factories who fell ill due to harmful work will receive payments of up to 150 million won (about $132 thousand at the exchange rate at the time of the application). Maximum compensation is provided for those who suffer from leukemia. In addition, people with other diseases, including girls who miscarried due to work, can count on payments.

The amount of payments will depend on the work time of the victim in the company. Reimbursement is provided for everyone who has worked since 1984.^[18]

The Committee for the Settlement of Disputes and Conflict Situations said that the settlement agreement with Samsung was concluded with the emphasis to at least somehow cover the damage to the health of more people and reduce the average amount of payments per employee. The fact is that the statistical relationship between the working environment and the disease is not fully defined, the organization added.

Compensation will receive not only directly working/working at Samsung, but also those whom the company has subcontracted.

Samsung has also pledged to donate 50 billion won to community organizations to help them work to improve the safety and health of workers in South Korea.

According to Supporters for the Health and Rights of People in the Semiconductor Industry (SHARPS), 320 people fell ill at Samsung by June 2018 due to difficult working conditions. 118 of them died.

Apple and Samsung fined €15m for deliberately slowing down smartphones

On October 24, 2018, the antimonopoly authority Italy (Autorità Garante dellaConcorrenza e del Mercato, AGCM) announced the imposition of a fine on Apple Samsung and a total of 15 million euros for deliberately slowing down work. smartphones

During a comprehensive investigation, the AGCM service found out that Apple and Samsung conducted dishonest commercial activities by releasing a number of embedded software updates for mobile phones, which led to serious violations in the operation of devices, thus speeding up the process of replacing them , the regulator said.

As a result, Apple was fined 10 million euros, Samsung - 5 million euros. Although these are small amounts by the standards of income of South Korean and American corporations, the fine is the maximum for Italy in such cases and a kind of symbolic, notes TechCrunch. If other countries impose such fines, then companies may suffer large losses from their dishonest actions.

Earlier, Apple explained that the decrease in the performance of old smartphones is due to the action of a special function, which is designed to protect devices from spontaneous shutdown and for this purpose neutralizes sharp jumps in performance.

The company officially admitted that due to this function, introduced including in the iPhone 7, the performance of the smartphone is capable of decreasing at certain points.

Apple has apologized to consumers. To restore the trust of its customers, the company promised to take a number of steps. Among them - a reduction in the cost of replacing the battery by $50, as well as a new version of iOS, which provides new features in order to monitor the state of the battery of your smartphone.

Samsung pushed users of its smartphones to install Android Mashmallow, which reduced battery life and functionality, forcing consumers to buy new devices.^[19]

Purchase of Zhilabs Network Analysis Software Developer

On October 17, 2018, Samsung Electronics announced the acquisition of Zhilabs. With this deal, the South Korean giant intends to strengthen the development of equipment for 5G networks against the background of how the corporation marks the leaders of this market. Read more here.

Samsung cuts memory production to curb prices

In September 2018, it became known about the decision of Samsung Electronics to limit the production of memory chips in order to prevent a further drop in prices for them.

We flexibly manage our production facilities in accordance with how supply and demand develop in the market, "Samsung told Bloomberg news agency.

Taking into account the adjustment of production plans, Samsung expects an increase in the supply of DRAM memory chips in terms of their total capacity by 20% and a 30% rise in the NAND flash segment. Earlier, the South Korean giant expected an increase in shipments by 20% and 40%, respectively, at the end of 2018.

By slowing down the pace of memory production, Samsung hopes for its rise in price or at least the preservation of current prices. According to TrendForce analysts, excessive supply led to a 15-20% drop in contract prices for flash memory in April-June 2018.

In the NAND flash segment, the excess of demand over supply was due, in particular, to a decrease in orders from Apple, and a lower than expected growth rate in demand for SSDs. 

The semiconductor industry is known for its boom and bust cycles. In 2018, investors are worried that Samsung and others in the market will begin to show financial regression amid weakening demand after record profits they had for several years. Price-building measures are part of efforts to keep profits high.

In the event of a reduction in the growth rate of DRAM memory supplies, the company shows that it is pleased with the current oligopolistic market structure, says Anthea Lai, analyst at Bloomberg Intelligence. - It prefers to hold back supplies and thereby keep its product prices steady instead of increasing its market share, risking a price collapse.[20]

Selling the Lab Diagnostic Devices Business

On September 20, 2018, it became known about the decision Samsung Electronics to sell the division for the production of devices for laboratory diagnostics (in-vitro diagnostics, IVD), which is part of the medical business of the South Korean vendor. The buyer of the IVD business Samsung is the Japanese corporation Nipro, which is considered one of the leaders in the global dialysis systems market. More. here

Workers at Samsung factories died for 10 years

On July 24, 2018, after ten years of protests from factory workers and their relatives affected by toxic chemicals at work, Samsung Electronics promised to comply with the independent committee's compensation orders, whatever decision it made.

In accordance with the agreement, which was signed by a company and a group representing the interests of workers, an independent committee will decide on compensation to the families of the victims and develop measures to prevent similar cases at Samsung production in the future. Both parties to the conflict agreed to make the final decision of the committee, which must announce it no later than October 2018.

Transferring responsibility for making a decision to the hands of an independent committee created in 2014 was not easy for Samsung. For years, the company resisted efforts to settle the claims and did not enter negotiations. The type of compensation, its size and recipients have not yet been determined, but this is a step forward, said the group representing the victims. Over the years, dozens of workers at Samsung's semiconductor and display plants have accused the company of negligent handling of toxic substances in manufacturing that have led to the development of leukemia and other deadly diseases in workers.

The first victim was Hwang Yu-mi, who died of leukemia in 2007 - at the age of 21 - after twenty months working in the production of Samsung chips. She manually immersed the boards in chemical solutions, having practically no means of protection. Her relatives' protest was the beginning of an avalanche of complaints from other workers; in 2014, the Seoul High Court acknowledged that Hwang Yu-mi's death was linked to an occupational illness.

The Semiconductor Industry Health and Human Rights Advocacy Group (SHARPS) says that since the 1990s, at least 80 people who worked in Samsung factories have died from diseases such as breast cancer, multiple sclerosis and malignant lymphoma.

According to SHARPS data, 23 of the 70 cases were recognized by the South Korean government or courts as professional-related deaths, however, some cases cannot be considered by the courts because relatives' claims had to come within three years of the date of death and are now deemed to be inadmissible.

Samsung declined to comment on the number of victims and only said that it wanted to "finally resolve" this issue. Since Hwang Yu-mi's death, Samsung has become the world's largest manufacturer of memory chips. Chip sales accounted for 74% of the company's fourth quarter 2017 profit.

In 2015, when it was not possible to come to an agreement with the protesting workers, Samsung organized its own program to compensate victims through a special fund of $88 million. The fund provided financial assistance and additional security measures to approximately 130 employees and contractors on the ground, a Samsung spokeswoman said. The spokeswoman declined to comment on the amount of compensation paid, but added that former Samsung chief executive Kwon Oh-hyun formally apologized to the victims and their families in 2014. However, SHARPS criticized the initiative at the time, which fell short of workers' expectations.

The victims welcomed the agreement concluded with an independent committee, but noted with displeasure how long it took Samsung to resolve the conflict.^[21]

Launch of the world's largest phone factory

On July 9, 2018, Samsung Electronics announced the launch of the world's largest mobile phone factory. It is located in the Indian city of Noida (part of the Delhi agglomeration).

According to Bloomberg, citing a statement from Samsung, the new enterprise with an area of ​ ​ about 140 thousand square meters will produce about 120 million smartphones every year. Pipes of all price categories will come from the conveyors - from models costing up to $100 to the flagship Galaxy S9.

Samsung launched production in India in 1995, but at first only TVs were produced. Since 2003, the company has been making refrigerators in the country, and since 2007, mobile phones. By July 2018, India produces about 67 million smartphones every month.

Earlier it was reported that Samsung's investment in the world's largest cell phone factory will amount to $620 million.

Samsung is expanding production in India after the smartphone market became the second largest in the world in 2017, ahead of the United States. More "smart" phones are sold only in China. According to Cisco forecasts, in 2021 in India there will be 780 million active smartphones against 359 million in 2016.

Samsung has long led the Indian smartphone market, but came out on top in 2018. Xiaomi

According to Bloomberg Intelligence, due to low earnings in India, locals prefer inexpensive smartphones worth up to $250. Because of this, it is difficult for Apple to increase its share in this country, since most iPhone models cost more than $500.

Samsung, Apple and other electronics manufacturers, which see great potential in the Indian market, are building production factories in the country as this reduces the cost of products. Moreover, India has increased duties on the import of communication equipment, including phones.^[22]

$400 million fine for stealing key technology in mobile processors

In June 2018, Samsung Electronics was fined $400 million for stealing key technology in mobile processors. We are talking about a patent owned by the Korea Advanced Institute of Science and Technology (KAIST), which describes the production of vertical gate transistors (FinFET), which significantly increase the performance of the microchip, while reducing its power consumption.

The Texas District Court found Samsung guilty of violating this patent. The company claims that work on the creation of FinFET was carried out in conjunction with KAIST, so there can be no question of any violation of intellectual property rights.

The institute noted that initially Samsung was skeptical about the invention, considering it insignificant. However, after Intel drew attention to it, the South Korean company also started developing this technology, thereby violating the agreement between Intel and KAIST.

Together with Samsung, charges were initially brought against GlobalFoundries and Qualcomm. The first was guilty of licensing production technology using FinFET from Samsung, and the second ordered products from the South Korean semiconductor giant. According to the court, GlobalFoundries and Qualcomm in this case are considered innocent

According to Bloomberg, the jury found Samsung's violation "intentional," which means that the judge can triple the amount of recovery from Samsung - up to $1.2 billion. The manufacturer himself intends to appeal the verdict.

We will consider all options, including an appeal, to achieve a reasonable outcome, Samsung said in a statement.

In May 2018, Samsung announced plans to use FinFET to create 4nm chips that will make electronics even smaller and more productive.^[23]

Samsung will pay Apple $539 million for a rounded case

Following a seven-year patent infringement trial, Apple sued Samsung for $539 million for illegal use of its inventions. The final decision was made by a jury of an American federal court in San Jose, California, Bloomberg reported. The jury deliberated for almost five days^[24].

According to the court, Samsung violated three Apple patents in the field of smartphone design, which will cost the Korean company $533 million. The patents relate to the rounded corners of the case, the rim around the front panel and the presentation of application icons in the form of a grid. Two patents from the field of functioning of devices were also violated, for which Samsung will pay about $6 million.

According to Bloomberg estimates, Samsung's daily profit from the sale of mobile devices is $38.9 million. That is, this unit alone can pay off Apple in about two weeks.

The patent war between Apple and Samsung has become one of the largest in the field of global patent law. Relevant media, including Bloomberg, call the current court decision final. Commenting on the situation, Apple said that this dispute has always been about something more than money. For its part, Samsung believes that the verdict undermines the creativity and fair competition of all smartphone manufacturers.

Implementing blockchain to improve logistics

On April 16, 2018, Samsung Electronics announced the introduction of a blockchain system to manage the giant global supply network that the company has. With the new technology, the South Korean giant expects to save billions of dollars. Read more here.

IOC member bribery scandal

In April 2018, information appeared about the possible bribery of officials. The consumer International Olympic Committee (IOC) manufacturer, electronic engineers Samsung which was one of the official sponsors of the IOC at the Games in Pyeongchang, was involved in the scandal.

According to South Korean television channel SBS, Samsung offered 27 committee members various marketing and sponsorship contracts in exchange for votes in support of Pyeongchang's bid to host the 2018 Winter Olympics.

According to the agreement with the IOC members, they had to vote for the French Annecy in the first round, and then, if this application was dropped out, cast their votes for Pyeongchang.

The SBS report claimed that 12 of the 27 IOC members on the list represent African countries. The names of the officials involved in this case are not indicated.

The list of IOC members who are suspected of taking bribes was established during an investigation into ex-President of South Korea Lee Men Bak, in which ex-head of Samsung Lee Jae Yong was also involved. The latter in 2017 was sentenced to five years in prison for his involvement in a high-profile corruption scandal in the highest echelons of South Korean power. Samsung denies information about bribes to IOC members.

The Korean bid won at the third attempt. When choosing the venue for the 2010 Games, Pyeongchang lost to Canadian Vancouver, in the case of the 2014 Games - Sochi. The names of the participants in the illegal transaction, as well as their activities by April 2018, remain unknown.

It is known that Pope Massata Diak, the son of ex-president of the International Athletics Federation Lamin Diak, helped determine the participants in the criminal scheme. The latter, by the way, is itself involved in the case of receiving a bribe for supporting Rio de Janeiro's application for the 2016 Summer Games. For his services, Diak received $1.5 million from a Brazilian businessman.

Manufacturing chips to mine cryptocurrency

On January 31, 2018, Samsung Electronics announced the launch of cryptocurrency mining chips. At one meeting, a company spokesman said Samsung would "benefit from increased demand for cryptocurrency."

Samsung Electronics completed the development of special-purpose semiconductor integrated circuits (Application Specific Integrated Circuit, ASIC) in 2017 and from January 2018 began supplying ASIC chips to a Chinese manufacturer. The name of the partner company has not been released.

Currently, we are just engaged in the production of equipment for our Chinese cryptocurrency mining partner, says a Samsung representative. - So far, we are at the very beginning of the journey, so the share of business profits is still small.

In the mining process, new blocks are created in the blockchain system to receive remuneration in the form of new units and commissions in various cryptocurrencies. This procedure is necessary to ensure protection against re-consumption of the same cryptocurrency units. These complex computing operations require specialized hardware and chipsets. It is these that Samsung is going to produce.

By the end of January 2018, the only major ASIC producer for bitcoin mining is the Taiwanese company TSMC. Its partner is Bitmain, whose chips occupy up to 90% of TSMC power in the ASIC segment. Samsung said it does not yet claim to be the leader in this area, but is already ready to become the second major manufacturer of cryptocurrency mining chips in China.

At the same time, the company plans to profit not only from the rush demand for ASIC equipment for bitcoin mining, but also to make money by selling GPUs (GPUs) involved in mining some other cryptocurrencies.^[25]

2017

Samsung is the largest advertiser in the world with $11.2 billion in spending

In December 2018, Ad Age, a professional advertising publication  , published an annual ranking of the largest advertisers. Samsung Electronics rose to the first place.

The advertising budget of the South Korean manufacturer in 2017 amounted to $11.2 billion, which is 13% more than a year earlier. Samsung's high advertising costs are due to the need to restore its reputation after the 2016 scandal, when the flagship smartphone Samsung Galaxy Note 7 was withdrawn from the market due to explosion. Read more here.

Theft of 8.5 thousand smartphones by a former disabled employee

In June 2017, a disabled person working at Samsung was arrested for stealing almost 8.5 thousand smartphones from the company. This was reported by The Investor, citing a statement by the South Korean police.

A man named Lee got a job at Samsung in 2010, when the company began hiring people with disabilities. At Samsung headquarters in Suwon (Kangido Province, South Korea), he was engaged in repairing old phones that were used by developers to test updates and new features.

All employees must go through an inspection scanner before leaving the office, but Lee passed this security system because he was in an electric wheelchair, which he used. From December 2014 to November 2016, Lee stole 8474 smartphones and sold them to stores selling used devices. On this fraud, the ex-Samsung employee earned about 800 million won (about $712 thousand) and spent money on the return of debts (their size exceeded 900 million won), accumulated as a result of addiction to gambling.

Samsung reported the theft to police in December 2016 when it found phones not intended for sale in Vietnamese stores. Which models Li illegally distributed is not specified.

In 2017, not only ordinary Samsung employees were at the center of the scandal. In February, the corporation's de facto leader, Jay Y. Lee, was taken into custody on suspicion of bribery and embezzlement. Prosecutors charged him with providing or promising about $36 million to close South Korean President Park Geun-hye in exchange for government support for the merger of the two subsidiaries in 2015.^[26]

2016

Buying Harman

On November 14, 2016, Samsung Electronics announced the acquisition of Harman International for $8 billion. This deal will turn the buyer into one of the world's largest manufacturers of automotive electronic technology. Read more here.

Purchase of Viv Labs

On October 6, 2016, Samsung Electronics announced the purchase of Viv Labs, Inc.,.

According to the company, the purchase of Viv demonstrates the desire to develop in the field of virtual personal assistants and is part of a common strategy for creating an open ecosystem on the platform of artificial intelligence technologies for all its devices and services. Through Viv solutions, Samsung plans to create user services with an interface that understands the context of user requests, while providing the most suitable and convenient recommendations or solutions.

As part of the merger, the Viv founding team will partner with Samsung's Mobile Communications division, while maintaining Samsung^[27]' current structure^[27].

Unlike other AI-based services on the market today, Viv includes advanced technologies for voice command recognition, supports machine learning and participates in strategic partnerships that expand the vast ecosystem of services. Viv solutions were created taking into account the interests of both ordinary users and developers. This is another factor that attracts us to Viv and makes the company's technologies the best option for integration into household appliances, wearable devices and other Samsung products, especially given that we see our future work precisely in the active development and optimization of artificial intelligence and voice control. Injong Rhee, Chief Technology Officer, Mobile Communications, Samsung Electronics

At Viv, we are working on creating simple ways that provide users with the ability to voice with devices and services. For us, the future is by no means limited to applications - soon we will be able to easily achieve the task, wherever we are and whatever device we use. Samsung offers us the ability to create a single language interface for a wide variety of applications, services and products. Dag Kittlaus, co-founder of Viv, chief executive officer of the company

The acquisition of Viv was carried out at the initiative of the Global Innovation Center Samsung (Global Innovation Center).

At GIC, we are in a constant search for promising companies and startups that, like us, look to the future and develop revolutionary products and services. We help them develop and take activities to the next level. - In our opinion, Viv software solutions and artificial intelligence platform have high potential, and we are pleased that thanks to Samsung, millions of users around the world will be able to take advantage of these advanced technologies. Jacopo Lenzi, Senior Vice President, Business Development and Strategic Acquisitions, Samsung

A $1.05 billion print business sale at HP Inc.

In September 2016, HP Inc. announced the signing of a binding agreement to buy Samsung Electronics' printing business, including printers and MFPs, for $1.05 billion. The company noted that this is the largest transaction in the print system market.

As part of the agreement, HP Inc. acquires all shares of Samsung Printing Business Unit, a new company will be created that will include all purchased assets. Samsung will continue to sell its own-brand printing devices in South Korea, buying them from HP.

It was planned to close the transaction within 12 months after the standard procedures were completed. After that, Samsung pledged to invest from $100 million to $300 million in HP by acquiring securities.

In addition to the production site in China, Samsung's sold business includes a design bureau, which owns over 6.5 thousand patents, and 6 thousand employees, including 1.3 thousand developers and engineers, specialists in the field of laser printing, image capture and processing. The business also includes 50 representative offices in various countries. At the end of 2015, the unit brought in revenue in the amount of 2 trillion won ($1.8 billion).

In the Samsung line, the American company was interested primarily in multifunctional A3 devices. The buyer emphasized that they have the speed of copiers, the simplicity and reliability of printers and have only a few parts that need to be replaced.

Combined with HP's PageWide technologies, these devices will allow the company to launch an innovative line of solutions that will be unmatched in hardware or software and offer market-leading security, HP Inc said.

Samsung is investing in the Internet of Things

On June 21 Internet of Things , 2016, Samsung announced plans to invest in its own developments in research and development Samsung. Electronics^[28]

The corresponding statement was made by Deputy Chairman of the Board and CEO Oh-Hyun Kwon. According to him, within four years the company will spend about $1.2 billion on research and development, the development of its IoT business in the United States. The investment will be part of the corporation's global initiative to create an "Internet of Things" ecosystem.

Half of this amount will go to its own research in the field of IoT, the second part of the investment - in other companies.

Samsung's priority areas are healthcare, smart machines (drones, robots and self-driving cars), firms that develop software to analyze large amounts of data coming from IoT-based devices.

Samsung is actively developing the direction of the Internet of Things. In May 2015, the corporation introduced the Artik IoT platform, which allows you to create smart sensors, various wearable devices, household appliances with Internet access, etc.

Obtaining a patent for smart contact lenses with a display

In April 2016, it became known that Samsung Electronics has developed contact lenses with a built-in camera. The company registered the corresponding patent with the South Korean patent office.

Samsung's smart and almost invisible contact lenses have a display that projects the image directly onto the retina. Integrated sensors and camera are controlled by blinking.

The design also provides miniature antennas used for wireless communication with a smartphone, which serves to receive data from electronic contact lenses. It is assumed that "smart" lenses will allow, unnoticed by others, to effectively use augmented reality. 

Contact lenses with built-in electronics were also invented by Google. Its development, which contains a tiny glucose meter and wireless transmitter, is designed to regularly measure blood sugar levels based on tear analysis.

By early April 2016, Google's smart contact lenses had not entered the mass market. The appearance on sale of a similar patented Samsung product is likely to not take place soon either. Companies often receive patents for their inventions and prototypes, but not all become commercial products.

Curiously, Samsung applied for a patent describing the work of smart lenses at about the same time with Google - in 2014.^[29]

2015: Rumours of Samsung trying to buy a BlackBerry

On January 15, 2015, the Reuters news agency reported on Samsung Electronics' attempt to acquire BlackBerry. The amount offered by the South Korean giant turned out to be significantly higher than the market price of the Canadian manufacturer.^[30]

Referring to an informed person and confidential documents, the publication writes that Samsung is ready to pay from $6 billion to $7.5 billion for BlackBerry, taking into account the conversion of debt obligations in the amount of $1.25 billion.

The initial price offer assumes a fee in the range of $13.35-15.49 per BlackBerry share, which is 38-60% more than the value of the vendor's securities at the time of the news about the deal with Samsung. Immediately after its publication, BlackBerry quotes increased by almost a third.

Samsung is ready to buy BlackBerry for $7.5 billion

It is noted that in early January 2015, a meeting of Samsung and BlackBerry executives took place, who, after listening to the opinions of their consultants, discussed a potential deal. The agency does not know anything about the results of the negotiations. The comments of company representatives were not long in coming.

"BlackBerry is not involved in negotiations with Samsung regarding any possible offer to buy BlackBerry," the Canadian manufacturer said in a statement.

Samsung also denied rumors of interest in BlackBerry, as a result of which the shares of the latter fell by 15% of the relative initial rise in price.

I must say that the proposed deal could come in handy for Samsung, as the company's share of the global smartphone market is declining due to the activity of Chinese competitors. The acquisition of BlackBerry would open up access to a profitable corporate audience and a huge number of patents in the field of mobile technology, which would allow Samsung to strengthen its position in the legal fight against Apple and other manufacturers.

According to Bloomberg observers, the sale of BlackBerry could not be approved by the Canadian authorities, which carefully check all major transactions for national benefits and security.^[31]

On January 19, 2015, the head of Samsung's mobile division publicly denied rumors about the company's interest in buying smartphone maker BlackBerry. At the same time, the South Korean giant is interested in further expanding cooperation with the Canadian company.

"We want to work with BlackBerry and improve partnerships, but not acquire this company in any way. For us, BlackBerry is one of the strategically important partners in the corporate market, "- quotes J.K. Shin, president of Samsung IT & Mobile Communication (responsible for the development and sale of smartphones and tablets), Bloomberg^[32]

According to the head of Samsung's mobile business, the company is in talks with BlackBerry to expand its collaboration. One option could be to use the technologies of a Canadian vendor in Samsung devices, according to The Wall Street Journal (WSJ), citing a statement from an Asian corporation.^[33]

Samsung and BlackBerry began storming the business solutions market together in November 2014. Then the companies agreed that in gadgets from the Samsung Galaxy series, the proprietary Samsung Knox protection system will be supplemented by cross-platform BlackBerry BES12 technology. This alliance was a response to the alliance of Apple and IBM in the business sector.

File:OS-YY480 bberry G 20130918034854.jpg

Samsung sees BlackBerry not as its "daughter," but as a business partner

According to WSJ observers, rumors about the possible takeover of BlackBerry by Samsung before their denial by JK Shin circulated in the press for several years. The last portion of this unofficial data was distributed by Reuters, which in mid-January 2015 reported a deal worth up to $7.5 billion. This amount, according to the publication, Samsung was ready to pay for BlackBerry.

The head of Samsung IT & Mobile Communication says the takeover of BlackBerry is not in line with Samsung's chosen strategy. It assumes a full and long-term concentration on the development of the Knox platform.

"We are pleased with Knox's progress, including its level of security and protection," Samsung said.

It is worth noting that Samsung has not been seen buying companies that would allow the South Korean manufacturer to strengthen its position in the corporate environment. Instead, Samsung prefers to enter into agreements: in addition to BlackBerry, similar contracts have been signed with Citrix Systems, Good Technology, MobileIron and AirWatch.

2014

A large staff of programmers does not help Samsung in the software market

At the end of December 2014, it became known that Samsung will launch the first smartphone based Tizen on January 18, 2015. The corporation has high hopes for this operating system, as the manufacturer is looking for an alternative Android and seeks to strengthen its position in the software market, where the vendor is not doing the best.

As of the end of 2014, Samsung's staff of programmers and software developers exceeds 40 thousand people, but most of the company's software projects were failures. So, in mid-2014, Samsung's first content service for mobile devices, the Samsung Books e-book reading and download portal, stopped working. In February 2015, one of Samsung's most popular mobile projects, the ChatON messaging service, will be closed.

"Honestly, the software that Samsung has developed so far has been far from perfect. I have not yet seen anything to indicate Samsung's competitiveness in the software market, "said IM Investment and Securities analyst Lee Min-hee.

One of Samsung's first software steps is the Bada operating system, on the basis of which the company has been producing smartphones for several years. In 2013, the corporation stopped releasing updates for this platform, and in January 2015 it will stop supporting Bada developers.

A large staff of programmers does not help Samsung in the software market

Thus, Samsung decided to fully focus on another "operating system" - Tizen. By the end of 2014, this OS appeared only in computerized wristwatches and digital cameras, although Samsung promises to release Tizen smartphones since 2013. According to Korea Economic Daily, such a phone will debut on January 18, 2015, and India is chosen as the first market.^[34]

The presentation of the first Tizen smartphone, called Samsung Z, took place in June 2014. It was planned to start selling this tube in Russia in the third quarter of 2014, but the deadlines were postponed due to the need to further improve the Tizen ecosystem.

The platform really needs more applications, and developers are in no hurry to create them, since Tizen is practically unknown to consumers. By the end of 2013, the number of programs and games for this OS was about 6 thousand, which is hundreds of times less compared to product catalogs for iOS and Android. The latter is the basis for almost all Samsung smartphones,

With its own operating system, Samsung could completely control the production of mobile devices, as Apple does, creating both hardware and software "stuffing." In order for Tizen to withstand Android and iOS, Samsung will have to try and make a very attractive offer to consumers, said IDC senior analyst Kiranjeet Kaur.

Reorganization of the company

On December 10, 2014, Samsung Electronics announced a merger with the mobile business of the divisions responsible for working with business solutions and software. These measures have become part of the reorganization that the South Korean giant (as well as many of its other compatriots) carry out annually.

Samsung Media Solution Center (MSC), which oversees the creation of applications and services for Galaxy smartphones, is integrated with Samsung IT & Mobile Communications, which develops and sells mobile devices. After abandoning some projects, rumors arose about the closure of MCS, but Samsung decided to merge it with the mobile business "in order to better respond to market changes and speed up decision-making." The manufacturer promises to continue developing services and content.

Samsung combines business solutions and software development

According to The Wall Street Journal, about half of MSC's 15 top managers have lost their positions, and the president of the software center, Hong Won-pyo, has been transferred to the post of head of the department responsible for global marketing strategy. Nobody has been appointed as his successor, which may indicate a future reduction in the staff of the MSC (amounted to about 1000 people by the beginning of December 2014).^[35]

Samsung IT & Mobile Communications also includes the Global B2B Center. Its head, Kim Seok-pil, became the head of strategic marketing at Samsung IT & Mobile Communications, replacing the resigned D.J. Lee. Executive Vice President Koh Dong-jin has been appointed head of the research team in the expanded mobile unit.

Samsung IT & Mobile Communications CEO J.K. Shin remained in his position despite rumors of leaving the company amid declining smartphone sales and expectations of the worst profit in three years in 2014. They decided to give Mr. Shin a second chance, which cannot be said about other top managers of the mobile business: the Joongang Ilbo newspaper reports that every fourth representative of the leadership of Samsung IT & Mobile Communications has been suspended from work. ^[36]

2012: Strengthening the Processor Development Team

At the end of March 2012, Pat Patla, former vice president and general manager of AMD's Opteron chip division, began working as vice president at Samsung Research Center in Austin, Texas, USA. Over the past few years, many managers and engineers with experience in developing server processors have moved to this center. In June 2011, after 16 years at AMD, Jim Mergard joined them, two months later Brad Burgess - he spent eight years at AMD and three years at Intel.

All this fuels rumors about the possible expansion of the second largest semiconductor manufacturer into the Intel-dominated server processor market. As you know, Samsung is a major manufacturer of processors based on ARM architecture. At one time, ARM Holdings announced the creation of chips for the server market and in October 2011 even introduced a 64-bit ARMv8 architecture. However, according to company representatives, such systems will be able to conquer the market no earlier than 2014. Around the same time, AppliedMicro announced a prototype 64-bit chip based on this architecture, and Marvell Technology and Calxeda announced their intention to create 32-bit chips.

Despite Samsung's aggressive recruiting policies, the Intel camp continues to remain calm and evaluates the competitor's actions with a considerable degree of salt. There are a number of objective reasons for this, first of all, the low performance of server solutions based on ARM architecture and the lack of support from enterprise software.

Charles King, senior analyst at Pund-IT Research, said that many of the employees who joined Samsung have experience in developing systems based on the SoC (system-on-a-chip) chip. Therefore, it is premature to talk about the exclusive focus of Korean manufacturers on the server chip market.

2011: Selling the Hard Drive Business at Seagate

In April 2011, Seagate bought the hard drive division of the South Korean company Samsung Electronics. The deal amounted to $1.35 billion, according to Seagate. Half of the amount will be paid in money, and the other will be paid in shares of an American company. As a result, Samsung will own a 9.6% stake in Seagate. At the same time, a representative of the South Korean company will join the Seagate board of directors. Also, under the terms of the agreement, Seagate will be able to use NAND flash memory modules manufactured by Samsung in its own solid state drives. The American company will also supply Samsung with hard drives and drives for computers and laptops. This deal is expected to close before the end of 2011. Until that moment, it will have to pass approval from American regulators.

Notes