Meanwhile, Samsung is experiencing "a sense of crisis", as CNN Money has mentioned in a post. Among the issues the chairman Lee Kun-Hee is expected to address, according to the Korea Times' chief Samsung watcher, Kim Yoo-Chul, is the ongoing patent disputes with Apple (AAPL). The Samsung vs Apple dispute is extremely important because the company is so reliant on its mobile phone business.
Anyhow, Lee seems to have great foresight by switching to an "emergency mode" starting in 2010, cutting executive paychecks and overseas travel (he also announced that most of Samsung's existing products would be gone in 10 years), given the numerous disputes it has against Apple right now. According to a FOSS blogpost, Germany's Bundespatentgericht (Federal Patent Court) ruled in Apple's favor and invalidated in its entirety (including any proposed amendments) the German part of Samsung's EP1005726 on a "turbo encoding/decoding device and method for processing frame data according to QoS", a patent Samsung had declared essential to the third-generation wireless standard.
Looking at the sales chart Samsung's Galaxy and iPhones, it really makes me wonder why Samsung is still investing great amount of money in mobile phone / smart phone related patent disputes, especially when the chairman has already addressed the issue of "over reliance" in earlier years. Could anybody shed some light?
It's a rough position for Samsung to be in. They margins are already quite low compared to apple; there isn't a whole lot of room for potential royalties, or any other mishaps that could affect their margins!
ReplyDeleteI'm curious how large of a portion of Samsung's revenue is comprised of smartphones sales. probably a double digit percentage?