Samsung a partner or foe for Sony and Apple?

Are Samsung and Sony partners or rivals? How about Samsung and Apple? The answer is both.

Sony competes with Samsung in the TV market, but at the same time the Japanese company is one of the biggest buyers of Samsung`s display screens.

Samsung, the world`s No. 2 handset maker, also seeks to take on Apple, the maker of the iPhone, in the smartphone market, but at the same time, Apple is a key customer of Samsung, the top maker of memory chips used in the hugely-popular gadget.

For Samsung, the lines between partners and rivals are blurring. This is nothing new for the maker of both electronics components and products. But tension is growing as Samsung, which previously focused on parts business, is boosting its products business, inevitably colliding with its customers, analysts said.



Samsung, which has been the top maker of memory chips and LCD panels, became the No. 1 TV maker and second-largest handset maker in recent years. The Korean electronics giant seeks to further increase its shares in those four markets, while expanding sales of other electronics goods such as computers, printers and cameras.



Sony-Samsung ties shaken?

The tension is evident in Samsung`s relations with Sony.

Sony gets most of the panels used in its TVs from S-LCD, its joint venture with Samsung established in 2004.

The LCD partnership has helped Sony secure a stable supply of panels, but this has generated skepticism within Sony, which ceded its top position to Samsung in the TV market three years ago.

The Japanese company suspects the joint venture may have offered panels to Samsung at cheaper prices, helping boost cost competitiveness of the archrival, according to industry officials and analysts.

Therefore, Sony seeks to reduce its reliance on Samsung panels and to diversify its panel suppliers to cut costs, analysts said.

The move came even as Samsung seeks to jointly invest in a next-generation LCD plant with Sony. Sony is already teaming up with Sharp in an advanced LCD plant, spurring questions among analysts whether Sony will invest in another LCD plant eyed by Samsung.

"Samsung-Sony relations do not appear to be as good as before," Will Cho, an analyst at Daewoo Securities, said.

"With Sony moving to reduce its dependence on Samsung, I expect Samsung to refrain from aggressively expanding its capital expenditure (to increase capacity)," said Park Young-joo, an analyst at Woori Investment and Securities.



Apple dilemma

Samsung also seeks to grab a bigger share of the smartphone market, in which Apple is one of the leading players. The company yesterday launched its mobile platform, bada, which will compete with iPhone`s operating system, Google`s Android and other operating systems.

Although Samsung is the world`s No. 2 handset maker, the company holds a meager share in the smartphone market. Even in Korea - its home turf - Samsung faces a growing threat from Apple, which recently rolled out its iPhone with KT.

However, the iPhone`s huge popularity is a boon to Samsung`s chip division, which supplies chips for Apple`s iPhone.

To reduce conflicts between its businesses, Samsung early this year divided its organization into two groups - one is a "sets" division, which includes TV and handset businesses, and the other is a parts unit, which includes LCD panels and chips.

"We operate the two divisions as if they were separate companies. I hope our customers do not misunderstand us," a Samsung spokesperson said.

(hjjin@heraldm.com)



By Jin Hyun-joo