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Samsung makes big changes as phone and consumer electronics divisions are merged

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It should come as no surprise, but outside of Apple, Samsung is the largest phone maker in the world. But the company has its hands in a lot of different areas, including consumer electronics, SoC manufacturing, and so much more. In a move that does come as a shock, a report from Reuters confirms that Samsung has merged its phone and consumer electronics divisions. By doing so, the company has named co-CEOs for the new division as Han Jong-see and Kyung Kye-hyun as the two in charge.

Formerly, Han was the head of the visual display business, while Kyung comes from the Samsung Electro-Mechanics affiliate. The goal by naming the two as co-CEOs, according to this report, is to “help lead the next phase of growth and boost competitiveness.” 

Like many in the smartphone industry, Samsung has been hit by a bit of a drought. The company saw “just” 21% profit from its mobile division in the last quarter, which is down “from nearly 70% at its peak in early 2010s.” Since then, much of Samsung’s profits have come through the companies ability to create chipsets at a time where pretty much every other chip-maker is struggling to do so due to the ongoing supply constraints. 

While Samsung isn’t stating exactly what Han’s focus will be in this company reshuffle, it’s possible that we could see more integration between smartphones and home appliances.

“In the long term, the biggest challenge is forming a platform of Samsung’s own,” said Lee Jae-yun, an analyst at Yuanta Securities Korea. “Those businesses have to keep increasing connectivity between devices, but so far it hasn’t been able to create a lasting platform with presence.”

The last time that Samsung made any type of drastic changes similar to this was back in 2017. But following Vice Chairman Jay Y. Lee’s bribery conviction, the company needed to make a big change and try to get its mobile division back on track.

Samsung continues to deal with pressure from Apple in the smartphone “race”, and the move to create a more cohesive user experience in the home could pay dividends. We’ve seen Apple move more and more into the “smart home” category with the likes of the HomePod Mini and continued updates to HomeKit. Meanwhile, Samsung continues to innovate on the smartphone front, with phones like the Galaxy Z Fold 3 and Z Flip 3 allowing the company to flex its muscles a bit. But after this move, it’s clear that Samsung has its sights set on something a bit bigger than just the phone that you use.

Andrew

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