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Samsung Electronics - software problem - Global Thematic Research

Samsung Electronics - software problem - Global Thematic Research

Summary

Reports that Samsung attempted to buy Blackberry last week for $7.5bn highlight the dilemma Samsung management faces. During its reign as the world’s largest producer of smartphones, Samsung piled up its cash reserves instead of investing heavily in the software that would power its next generation of smart products.

It forgot to mention that many would still be powered by Google Android software. Now it faces commoditisation of its entire consumer electronics hardware division, because a string of new technology cycles about to hit Samsung are all controlled by software: the internet of things, internet TV, big data, mobile payments, mobile commerce, online gaming, cloud, cyber-security, software defined networking and the list goes on. In all these technology cycles, controlling the software is the only way Samsung can hope to maintain the profit margins needed to justify its valuation.

Inside this report we look at problems faced by Samsung and solutions provided for the same.

Scope

This report is part of our ecosystem of thematic investment research reports, supported by our “thematic engine”.
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