Samsung Electronics has announced an internal reorganization merging the mobile phones division with consumer electronics, and retaining its semiconductor unit as a separate entity. This could indicate that the company seeks to keep focus on both its visual display business and on chipsets that power next generation devices.
The announcement was part of a detailed statement from the South Korean giant which also made several changes at the leadership level. The company would now have two CEOs overseeing two divisions (instead of three in the past), that includes the new SET division and the semiconductors business.
These changes, in effect, reverses earlier ones made in 2017 when Samsung had appointed three industry leaders of the three divisions, viz., electronics, phones and semiconductors.
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Shifting focus to visual display
More than the actual reorganization, what's interesting is the choice of personnel that Samsung made to head these two divisions. Jong-Hee Han, who was credited with making Samsung the leading television brand as global head of TV sales, now becomes the co-CEO of the new SET division.
The company says that in his new role Jong-Hee Han is "expected to strengthen the synergies among the different businesses in the SET Division and help drive new businesses and technologies." In other words, we can safely state that visual display could be one area where Samsung could be innovating big time, especially since it has already pioneered foldable screens.
Samsung Display has held sway of the $148-billion global smartphone display panel market, claiming half of it. Currently, the world's largest manufacturer of small size OLED panels used in phones and tablets, the Korean company had showcased its multiple form factors on its flexible panels recently.
The growing TSMC challenge
As for the semiconductor division, the reorganization gets Kyehyun Kyung, who was previously heading Samsung's electro-mechanics division. He is credited with the heading the company's flash memory product team and the DRAM (dynamic random access memory) design team.
This could be one area where Samsung would be keen to maintain its position, given growing competition from the likes of Intel and TSMC. Post the recent launch of the Snapdragon 8 Gen 1 chipset, Qualcomm had indicated that it would continue its association with Samsung foundry for its flagship processors.
In the past, Qualcomm had moved to Taiwan's TSMC to get some of the top-notch chipsets including the Snapdragon 888 (2020), the Snapdragon 865 (2019) and the Snapdragon 855 (2018). Samsung would definitely be eyeing larger orders from the chipmakers to boost their foundry business.
A report published by SamMobile claimed that Qualcomm was not happy with the shipments from Samsung Foundry's 4nm fabrication process. The chipset maker, it is claimed, has warned that production of the Snapdragon 8 Gen 1 could be moved to its arch-rival TSMC if such production issues persist.
Similar issues persisted even with Samsung's own Exynos 2200 chipset, which also is being built using the foundry's 4nm process. There were unsubstantiated rumors of the Samsung Galaxy S22 facing chipset shortages though as an entity Samsung will be more worried of losing Qualcomm to TSMC.
Readers would recall that Samsung had Samsung Electronics had announced in 2019 that it had set aside $115 billion to take on Intel and Qualcomm in the advanced semiconductor business, with the aim of becoming the world leader in the logic chip market by 2030.
Which is probably why Samsung is handing over charge of its semiconductor division to Kyehyun Kyung with the expectation that the official can "maintain the company’s semiconductor leadership and lead innovation in the components business."
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