By Kim Yoo-chul
Staff Reporter
Samsung Electronics and LG Electronics are following different paths in their strategies seeking out future cash cows.
Amid the global downturn, the Suwon, Gyeonggi Province-based Samsung is busy creating new markets, while LG is taking a somewhat conservative stance in order to boost new segments.
Attention is being focused on how such mixed approaches adopted by the electronics companies can pay off after worries over the global downturn are eased.
Since early this year, Samsung Electronics has been making an aggressive pitch for liquid crystal flat-screen TVs equipped with light-emitting diode (LED) backlights. Next-generation solid-state drives (SSD) storage devices, phones with highly advanced AM OLED panels are other items it is pushing.
"Samsung is tasked with creating a new market in next-generation TVs. Getting more shares in the next lines of business is significant to maintaining sustainability and seeking further external growth," a Samsung spokesman said Friday.
Despite lacking original technology, Samsung has successfully overtaken Japan's Sony in the global flat-screen TV market since 2006. Officials say time is on the industry leader's side because Sony is out of sight in the TV competition stakes.
It has sold 350,000 "LED TVs" globally in two months since its introduction ― the market for LED TVs is expected to reach 3 million in 2009, according to market research firms.
In handsets ― where Samsung trails the industry leader Nokia ― it plans to put the next-generation AM OLED panel into 70 percent of its smart-phones this year.
To spur the AM OLED panel business, Samsung and its flat-screen affiliate Samsung SDI created a 50:50 joint venture named "Samsung Mobile Display."
For SSDs, the company plans to inject additional capital despite mixed signals on the global memory chip market. SSDs are storage memory devices that are used in high-end PCs. Higher prices, however, are considered as the major drawback for general consumers.
While "new market" is the buzz phrase for Samsung, LG Electronics is stubbornly taking a "consumer insight" track in its key TV and mobile phone businesses.
"A phone equipped with an AM OLED panel is pricey and it would be difficult for the phone to meet the needs of general consumers who hope for lower prices," Ahn Seung-kwon, head of LG's mobile communications, said at a launching event of its multimedia- and content-featured ARENA mobile.
Ahn said his unit doesn't have any plan to introduce "AM OLED phones" and reiterated LG will show more attention to consumer-focused devices.
"At the maximum, five years will be needed for the global AM OLED market to realize economies of scale. We will take our time," a high-ranking LG executive said.
LG is the runner-up to Samsung Electronics in the global mobile phone market ― but the share gap is 7 percentage points.
In LCD TVs, LG plans to beat Sony to become the world's second-biggest maker. Officials say nurturing LED TV-related technology is where LG is now situated.
"Innovative products such as Apple's iPod have helped consumer electronics companies strengthen their brand images in the global market. But Sony's bold moves in next-generation AM OLED TVs have virtually failed. It's too early," according to an industry source.
"Currently, it's premature to say which strategy ― risk-taking or consumer-insight ― is better. Both seem fine," the source added.