KOREA: Samsung reorganises to stabilise its LCD business

Faced with the poor recent performance of its LCD business, Samsung is undergoing a reorganisation designed to stabilise its earnings, and appears to be putting its faith in rapid development of OLED TVs.

Chairman Lee Kun-hee (left) has put the past president of the company's semiconductor division, Kwon Oh-hyun, in charge of the new Device Solutions unit, which now covers both semiconductors and LCD operations.

The move sees the departure of the previous LCD boss, Chang Won-kie, and the transfer of two other senior officials in that division to new posts, according to reports.

The move, which comes in the light of a 25% fall in operating profit in the April-June quarter, now means Kwon is in charge of two of the company's four main divisions – the others are mobile phones and finished flatscreen TVs. It also sees Samsung acknowledging the need for different sectors of its business to co-operate, rather than working in isolation.

That would help the company weather the current choppy waters of the LCD market, which is currently experiencing plummeting prices created by slipping demand and oversupply.

It also aids Samsung in catering to the needs of outside customers, such as Apple, which increasingly buy several major components for a product from the same manufacturer.

OLED TVs next?

Interestingly, Samsung Mobile Display has recently moved its headquarters to its new OLED plant in Tangjeong, near to Samsung's major LCD factory, which is viewed by analysts as part of bringing together all of the company's display operations – both OLEDs and LCDs for portable devices and LCDs for TVs.

It's thought this move may well signal that Samsung is counting on OLED to kickstart its TV operations once again, as LED-backlit LCD TVs over the past couple of years.

Samsung is expected to launch OLED TVs in 2013, just behind its major Korean competitor, LG.

US success

The move comes despite figures launched today showing that Samsung is enjoying continued success in the US TV market, with well over a third of all TV sales by value, and leadership in the LED, 3D and internet-connected TV sectors.

The figures, from market research company NPD, reveal that the company had a 35.4% share by value of the total US flatscreen TV market (25.4% by volume) in the first half of this year, 44.1% of the LED-lit TV sector and 54.5% 3D TV share.

It also has almost 50% of the large-screen (50in+) plasma TV market in the States, and 40% of all LCD TV sales by value in the 40in+ class.

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Andrew has written about audio and video products for the past 20+ years, and been a consumer journalist for more than 30 years, starting his career on camera magazines. Andrew has contributed to titles including What Hi-Fi?, GramophoneJazzwise and Hi-Fi CriticHi-Fi News & Record Review and Hi-Fi Choice. I’ve also written for a number of non-specialist and overseas magazines.