By Kim Yoo-chul
Korea’s industrial titans are showing mixed responses over the absence of the Apple CEO Steve Jobs, who is currently taking indefinite medical leave for unspecified problems.
LG Display and KT, which have racked up rapid growth thanks to the rise of a set of Apple hit products, avidly hope for a fast recovery of Jobs, while Samsung Electronics remains tight-lipped on the issue.
Samsung seems to be a beneficiary from the absence of Jobs as investors have flocked to the world’s foremost maker of memory chips and handsets over the past weeks after Jobs stopped working.
According to market observers, investors might expect Samsung will be able to take advantage of Jobs’ leave to undermine the runaway dominance of Apple in smartphones and tablet computers.
The results: Shares of Samsung Electronics reached a record high last week of 1 million won for the first time since the corporation was listed in 1975.
When contacted, spokespeople at Samsung Electronics declined to comment on the issue, possibly since the firm is also a key supplier to Apple of components such as chips and liquid crystal displays (LCD) used in the iPhone and the iPad.
Yet, an executive at the electronics powerhouse confided its mixed sentiments to The Korea Times.
"Jobs' absence might be sentimentally good for Samsung. However, it might not be good for us in the long term because it is feared to negatively affect our shipments of chips and displays to Apple," said the executive who asked not to be named.
Apple accounts for almost 20 percent of Samsung’s total sales of chips and LCDs.
Samsung's market capitalization amounts to $136 billion, which is tantamount to the combination of Sony, Nokia, Toshiba and Panasonic.
But, that’s still less than half of that of Apple, which boasts of $320 billion market value thanks in no small part to the iPhone that makes up more than 40 percent of Apple’s operating profits.
In comparison, Apple partner LG Display joined KT, the U.S. outfit’s exclusive sales partner here, in praying for a quick recovery of Jobs.
"I certainly wish Apple CEO Steve Jobs a full and speedy recovery as early as possible," LG Display CEO Kwon Young-soo told in a meeting with reporters, last week, just after announcing its fourth quarter earnings.
"LG Display is very close to Apple. Jobs is the man who leads industries' new wave. Apple is one of our critical business partners."
Kwon’s remarks came on the heels of the comments of charismatic KT Chairman Lee Suk-chae, who paid a rare tribute to Jobs by saying his leave ``is not good for the global economy.’’
The 66-year-old said that Jobs helped industries see a pair of revolutionary events _ the rise of the application market as well as the eco system for application developers from across the world.
Kwon said the tie-up with Apple is ``still secure,’’ in response to concerns that the Cupertino, California-based consumer electronics company is diversifying its procurement channels to reduce its dependence on LG.
``It’s is natural for Apple to partner with other suppliers as it sells more of its strategic products,’’ he said.
``It’s important with whom Apple is partnering in the crucial segment. That’s why we don’t see any corporate cracks with Apple.’’
Apple is already two years into its five-year deal with LG as far as shipping LCD panels is concerned. In 2009, LG said that it will receive an initial payment of $500 million from Apple.
LG Display is now supplying LCD screens with its in-plane switching (IPS) based technology to Apple’s 9.7-inch tablet computer, the iPad and the iPhone 4.
Jobs once said that the so-called high-resolution ``Retina’’ display powered by the IPS technology is better than expensive organic light-emitting diode (OLED), which is avidly pursued by LG’s rival Samsung Electronics.
Back then, observers came up with analysis that Apple sides with LG Display, which cornered Samsung Electronics.
IPS technology is customized to achieve a wider viewing angle than on traditional LCDs, meaning the iPad and iPhone 4 users could hold the devices almost any way they want and still get a clear picture image.
The Retina display also provides four times the contrast ratio of previous models, making it possible for white to be brighter and black darker.
LG is in neck-to-neck with Samsung in the global market for LCDs.
The LG CEO Kwon is also upbeat over the business expansion with Japan’s Sony even towards panels for three dimensional televisions as its film patterned retarder (FPR) 3D panels garnered favorable reviews from retailers to consumers.
``Sony is diversifying its LCD panel procurement strategy. LG Display, as well as Taiwan’s Chi Mei Innolux (CMI), are the new targets for the Tokyo-based world No. 3 TV maker,’’ Kwon said, adding TV majors were gradually relying on outsourcing for cost-cuts.
Sony normalized the business partnership with LG Display from late last year _ one of the biggest breakthroughs for LG, which is being pressurized to increase its customer base.
Sony stopped buying its television panels from LG Display in 2004 after establishing a joint venture with Samsung.
Hong Ji-eun, a Sony representative in South Korea, declined to comment on Kwon’s remarks, though Sony’s TV head Toshifumi Okuda slightly ruled out such possibility in a recent exclusive interview with The Korea Times.
During the press conference, Kwon, who is one of the most-trusted high-profile executives in Korea’s fourth-biggest conglomerate LG Group, also took issue with its rival Samsung Electronics’ technology.
Kwon said that he still doubts over the viability and accessibility of 3D televisions using the so-called ``active-shutter technology’’ adopted by Samsung.
LG highly bets its FPR tech has everything that active-shutter tech is not as the film is cost-edges and the picture is brighter, more vivid and even has less flickering and crosstalk with active-shutter panels.
``Ten television majors including Philips of the Netherlands, Toshiba of Japan, Vizio of the United States, as well as LG Electronics are joined the FPR-camp,’’ said Kwon, expecting Philips and LG Electronics to go all in with FPR 3D TVs for this year.
Kwon said the commercialization of glasses-free 3D televisions will come after five years due to higher costs and viewing quality.
On its starts-up LCD line schedule in China, the CEO said; ``We will delay the timing of the operation. LG will closely monitor the TV market situations in China until the first half of this year.’’
LCD industry is highly volatile and subject to economic moves as it’s becoming commoditized like memory chips due to more players.
Timing is especially important to top-tier LCD makers such as LG Display to escape from the business deterioration happened two years ago.
``The most stressful thing is to gauge and decide the right timing for investment,’’ said Kwon.