Samsung Electronics
Samsung Electronics Co., Ltd. (Korean: 삼성전자; Hanja: 三星電子; RR: Samseong Jeonja; lit. Tristar Electronics; sometimes shortened to SEC and stylized as SΛMSUNG) is a South Korean multinational major appliance and consumer electronics corporation headquartered in Yeongtong-gu, Suwon, South Korea.[1] It is currently the pinnacle of the Samsung chaebol, accounting for 70% of the group's revenue in 2012.[4]
This article is about the electronics subsidiary. For the conglomerate, see Samsung.
Native name
삼성전자 주식회사
Samseong Jeonja Jusikhoesa
Samsung Electric Industries (1969–1988)
KR7005930003
- Electronics
- Consumer electronics
- Semiconductors
- Computer hardware
- Home appliances
- Internet of things
- Medical devices
- Telecommunications(portable device
13 January 1969 in Suwon, South Korea
Worldwide
- Lee Jae-yong (executive chairman)
- Han-Jo Kim (chairman of the board and independent director)
- Jong-Hee Han (vice chairman and CEO (DX))
- Kye-Hyun Kyung (president and CEO (DS))
US$198.247 billion (2023)
US$5.027 billion (2023)
US$11.857 billion (2023)
US$349.053 billion (2023)
US$278.441 billion (2023)
- National Pension Service (8.69%)
- Samsung Life Insurance (8.51%)
- Samsung C&T Corporation (5.01%)[2]
270,372 (December 2023)
Samsung Electronics has played a key role in the group's corporate governance due to cross ownership.[5] Samsung Electronics has assembly plants and sales networks in 74 countries and employs more than 270,000 people.[6] It is majority-owned by foreign investors.[7][8] As of 2019, Samsung Electronics is the world's second-largest technology company by revenue, and its market capitalization stood at US$520.65 billion, the 12th largest in the world.[9]
Samsung is the world's largest manufacturer of smartphones since 2011. Samsung is best known for its Samsung Galaxy brand including the Samsung Galaxy S series which was first produced in 2010. It has developed 5G-capable smartphones, including the Galaxy S24,[10] and foldable phones, including the Galaxy Z Fold 5.[11] The company is a major vendor of tablet computers, particularly its Android-powered Samsung Galaxy Tab collection, and is regarded for developing the phablet market with the Samsung Galaxy Note family of devices.[12] Samsung has also been the world's largest television manufacturer since 2006 as well as the world's largest soundbar brand.[13][14]
The company is a major manufacturer of electronic components such as lithium-ion batteries, semiconductors, image sensors, camera modules, and displays for clients such as Apple, Sony, HTC, and Nokia.[15][16] It is also the world's largest semiconductor memory manufacturer[17] and, from 2017 to 2018, had been the largest semiconductor company in the world, briefly dethroning Intel, the decades-long champion.[18]
In 2012, Kwon Oh-hyun was appointed the company's CEO. He announced in October 2017 that he would resign in March 2018, citing an "unprecedented crisis".[19][20][21] The company had three CEOs (Ki Nam Kim, Hyun Suk Kim, and Dong-Jin Koh) from March 2018[22][23] until December 2021, when the business units were reorganized and they were replaced by Kyung Kye-Hyun and Han Jong-hee.[24][25] It has also had a separate regional CEO, HC Hong, who led the business in Southwest Asia since 2015 and then moved to Latin America in 2020.[26][27][28]
History[edit]
1969–1987: early years[edit]
Samsung Electric Industries was established as an industrial part of Samsung Group on 13 January 1969 in Suwon, South Korea.[29] At the time, Samsung Group was known to the South Korean public as a trading company specialized in fertilizers and sweeteners. Despite the lack of technology and resources, falling shorter even than the domestic competitors, Samsung Group improved its footing in the manufacturing industry by cooperating with the Japanese companies, a decision that led to a significant amount of anti-Japanese public outcry and huge backlashes from the competitors fearing the outright subordination of the industry by the Japanese. The strategy was able to take off only after the government and Samsung declared that the company would exclusively focus on exports. Toshio Iue, the founder of Sanyo, played a role as an advisor to Lee Byung-chul, Samsung's founder, who was a novice in the electronics business. In December of the same year, Samsung Electric established a joint venture named Samsung-Sanyo Electric with Sanyo and Sumitomo Corporation. This is the direct predecessor of today's Samsung Electronics.[30]
The joint venture's early products were electronic and electrical appliances including televisions, calculators, refrigerators, air conditioners, and washing machines. In 1970, Samsung established the joint venture Samsung-NEC with Japan's NEC Corporation and Sumitomo Corporation to manufacture home appliances and audiovisual devices. Samsung-NEC later became Samsung SDI, the group's display and battery business unit. In 1973, Samsung and Sanyo created Samsung-Sanyo Parts, the predecessor of Samsung Electro-Mechanics. By 1981, Samsung Electric had manufactured over 10 million black-and-white televisions.
In 1974, Samsung Group expanded into the semiconductor business by acquiring Korea Semiconductor, which was on the verge of bankruptcy while building one of the first chip-making facilities in the country at the time. Soon after, Korea Telecommunications, an electronic switching system producer and a Samsung Group company, took over the semiconductor business and became Samsung Semiconductor & Communications.[31]
In February 1983, Lee, 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 dynamic random-access memory (DRAM) vendor. One year later, Samsung announced that it had successfully developed a 64 kb DRAM, reducing the technological gap between the companies from first-world countries and the young electronics maker from more than a decade to approximately four years. In the process, Samsung used technologies imported from Micron Technology of the U.S for the development of DRAM and Sharp Corporation of Japan for its SRAM and ROM.[32] In 1988, Samsung Electric Industries merged with Samsung Semiconductor & Communications to form Samsung Electronics,[33] 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.
In the 1980s and early 1990s, Samsung sold personal computers under the Leading Technology brand. However, the equipment was manufactured by Samsung, and the FCC filings from this period typically refer to Samsung products.[34]
1988–1995: consumer struggles[edit]
In 1988, Samsung Electronics launched its first mobile phone in the South Korean market.[35] 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.[35] 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.[36]
1995–2008: component manufacturing and design strategy[edit]
Lee Kun-Hee decided that Samsung needed to change its 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 that, 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.[37]
A complementary brand leadership strategy was also initiated by chairman Lee when he declared 1996 to be the "Year of Design Revolution" at Samsung. His objective was to build Samsung design capabilities as a competitive asset and transform the company into a global brand-design leader. However, this effort required major changes in corporate culture, processes, and systems. By integrating a comprehensive design management system and strategy into the corporate culture, Samsung was successful in developing an award-winning product design portfolio by the late 1990s, resulting in significant brand equity growth.[38][39][40]
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.[41]
As a chaebol, Samsung Group wielded wealth that allowed the company to invest and develop new technology rather than build products at a level that would not have a detrimental impact on Samsung's finances.[42]
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 64 MB DRAM in 1992, 256 MB DRAM in 1994, and 1 GB DRAM in 1996.[43] In 2004, Samsung developed the world's first 8 GB 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 Samsung remains a key supplier of Apple components as of October 2013, manufacturing the A7 processors inside the iPhone 5S model.[44][45]
In December 2010, Samsung switched its management system from a single CEO-system under Choi Gee-sung to a two-person management team with Choi Gee-sung, CEO and vice chairman, and Lee Jae-Yong, chief operating officer and president. In June 2012, Samsung appointed Kwon Oh-Hyun as CEO of the company.[221][222] Samsung also reorganized its overseas marketing bases in line with changes in the market, including a combined Britain/Continental Europe regional subsidiary, and a combined China/Taiwan regional subsidiary.
In 2012, Samsung appointed director of mobile products, J. K. Shin, to president/CEO of Samsung Electronics for Mobile Consumer Products.
The company added a new digital imaging business division in 2010, and consists of eight divisions, including the existing display, IT solutions, consumer electronics, wireless, networking, semiconductor, and LCD divisions.
It merged consumer electronics and air conditioners in 2010 under the consumer electronics business division. The set-top boxes business was merged with the Visual Display Business division.
The company's 2023 reorganization was as follows: Among the eight divisions, the network division and the digital imaging division experienced new appointments, while the remaining divisions were maintained in accordance with their results.[223]
The following are the names of the board of directors' members:[224]
Around 44% of Samsung Electronics' shares are held by the general public, around 38% are held by institutions, and insiders held around 4% of shares. The largest shareholders in early 2024 were:[225]
Design[edit]
In the early 1990s, Samsung began considering the importance of physical design in its products. When chairman Lee declared 1996 'The Year of Design Revolution', a comprehensive global design program was initiated with the goal of design being a strategic asset and competitive advantage for the company.[38][39][40] Located in the company's high-rise headquarters in Gangnam (south of Seoul) the corporate design center includes more than 900 full-time designers. In 1971 there were only a few designers in the whole company, whose number rose to 1,600 by 2015.[246] In addition to the corporate design center in Seoul, there are design centers located in Tokyo, San Francisco and London.[247]
The company overhauls its design over a two-year cycle. For the first year, it scrutinizes design trends of the world, followed by product strategies. It then maps out new design plans during the second year.
Since 2006, it has won as many as 210 awards from international design institutions.[248] It received the iF (International Forum) and IDEA design awards. Working with partners, Samsung was the winner in eight categories in the 2009 IDEA awards, hence receiving the most awards.[249]
In the 2010 iF Material Awards, the company won the Gold Award for five of its products including the external hard disk drive. The iF Material Awards are given by the International Forum Design GmbH of Hannover, a design award for design materials and process technologies. In 2010, the German company selected a total of 42 products in the areas of home appliance, furniture, and industrial design. Samsung won the awards in five categories including external hard disk, full-touch screen phone, "side-by-side" refrigerator, compact digital camera, and laser printer toner.[250]
Criticism and controversies[edit]
Environmental record[edit]
All Samsung mobile phones and MP3 players introduced on the market after April 2010 are free from polyvinyl chloride (PVC) and brominated flame retardants (BFRs).[251]
The company is listed in Greenpeace's Guide to Greener Electronics, which rates electronics companies on policies and practices to reduce their impact on the climate, produce greener products, and make their operations more sustainable. In November 2011, Samsung was ranked seventh out of 15 leading electronics manufacturers with a score of 4.1/10.[252] In the newly re-launched guide, Samsung moved down two places (occupying fifth position in October 2010), but scored maximum points for providing verified data and its greenhouse gas emissions. It also scored well for its Sustainable Operations, with the guide praising its relatively good e-waste take-back programme and information. However, the company was criticized for not setting an ambitious target to increase its use of renewable energy and for belonging to a trade association which has commented against energy efficiency standards.[252]
In June 2004, Samsung was one of the first major electronics companies to publicly commit to eliminate PVC and BFRs from new models of all their products. However, the company failed to meet its deadlines to be PVC- and BFRs-free, and published new phase out dates.[253] In March 2010, Greenpeace activists protested at the company's Benelux headquarters for what they called Samsung's "broken promises".[254]
The company has been awarded as one of global top-ten companies in the Carbon Disclosure Leadership Index (CDLI). It was the only Asian company among top ten companies. In addition, the company is listed in Dow Jones Sustainability Index (DJSI).[255]
The company's achievement ratio of products approaching the Global Ecolabel level ("Good Eco-Products" within the company) is 11 percentage points above the 2010 goal (80 percent). In the first half of 2010, Samsung earned the Global Ecolabel for its 2,134 models, thereby becoming the world's number-one company in terms of the number of products meeting Global Ecolabel standards.[255]
The company is also improving its effort to recover and recycle electronic wastes.[256] The number of wastes salvaged throughout 60 countries during 2009 was as much as 240,000 tons. The "Samsung Recycling Direct" program, the company's voluntary recycling program under way in the United States, was expanded to Canada.[257]
In 2008, the company was praised for its recycling effort by the U.S. advocacy group Electronics Take Back Coalition as the "best eco-friendly recycling program".[258] In 2023, the U.S. Environmental Protection Agency (EPA) awarded the company its 10th consecutive Sustainable Excellence Award in the manufacturer's category.[259]