Samsung exits fibre optics to focus on reviving smartphone business

Samsung expects first annual profit fall in 3 yearsSamsung unveils new UHD TV at CES, seeks fresh start in 2015
Samsung Electronics agreed to sell its fibre optics operations to US specialty glass maker Corning Inc, exiting another non-core business to focus on shoring up underperforming key areas like smartphones.
The terms of the sale, including plants in China and South Korea, weren’t disclosed. Announced by both parties on Tuesday, the South Korean firm’s second exit from a business line this quarter comes as it braces for its lowest annual profit in three years, squeezed by stiff competition.
Samsung, which was once the world’s top maker of smartphones, has been caught between Chinese rivals like Xiaomi at the low end and Apple’s iPhones at the top. Samsung Electronics’ share of the global smartphone industry has shrunk year-on-year for the last three quarters.
“We have decided to sell our fibre optics business, in order to focus on our core business areas,” a Samsung Electronics spokeswoman said. The company declined to comment on how much revenue the division generates.
South Korean Samsung also said in October it will halt its light emitting diode lighting business outside of its home country, which was also considered a non-core business.
Corning, which supplies glass for Samsung and Apple smartphones, said the deal will strengthen its fibre optics business in the Asian market.

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Samsung Electronics Scales Back LED Lighting Business

Samsung

Samsung Electronics Co Ltd said on Monday that it will cease its light emitting diode (LED) lighting business outside of South Korea, scaling back what was identified as a key growth business four years ago.
LED, rechargeable cells for hybrid electric cars, solar cells, medical devices and biopharmaceuticals were five areas singled out by the Samsung Group in 2010 as new growth drivers for the conglomerate.

At the time, the group forecast the businesses would generate 50 trillion won ($47.5 billion) in annual revenues by 2020 for its affiliates including Samsung Electronics.

But Samsung Electronics has struggled to gain traction in the LED lighting market, failing to loosen the grip of established rivals such as Philips and Osram in advanced markets while facing mounting margin pressures from Chinese competitors in emerging markets.

“We will remain active in the LED industry through our LED component business,” Samsung Electronics said in an emailed statement, adding that it will focus on areas such as backlighting for displays of consumer products like televisions.

Samsung Group affiliates have seen limited returns so far from the five new growth areas.

While Samsung SDI Co Ltd is supplying German premium automaker BMW with electric vehicle battery cells, Samsung companies have struggled to generate significant revenues form other businesses such as solar cells.

Analysts and investors have said developing or identifying new growth drivers will be a key test for Jay Y. Lee, heir-apparent of Samsung Group, as his father, group patriarch Lee Kun-hee, remains hospitalised following a May heart attack.

A Samsung Electronics spokeswoman said the revenue contribution of LED lighting to the company had been small. She declined to give specific figures.

Apple wins $1 billion in patent case against Samsung

Apple won more than $1 billion in a massive US court victory over Samsung on Friday, in one of the biggest patent cases in decades – a verdict that could have huge market repercussions.

A jury in San Jose, California awarded $1.049 billion to the US tech giant, according to reports from the courtroom. But analysts said the damages could be tripled because jurors found Samsung “willfully” infringed on patents.

The jury rejected the South Korean electronics firm’s counterclaims against Apple, which had claimed its iconic iPhone and iPad had been illegally copied.

Samsung reacted by saying the verdict was “a loss” for consumers and that Apple had “manipulated” the patent system.

The South Korean firm also said the verdict was “not the final word” in this case or other similar battles around the world.

“Today’s verdict should not be viewed as a win for Apple, but as a loss for the American consumer,” Samsung said.

“It is unfortunate that patent law can be manipulated to give one company a monopoly over rectangles with rounded corners, or technology that is being improved every day by Samsung and other companies… Samsung will continue to innovate and offer choices for the consumer.”

The decision appeared to be an overwhelming victory for Apple, but it was not immediately clear if it would halt sales of Samsung devices or affect newer models released since the case was filed.

“This is a huge, crushing win for Apple,” said Brian Love, a professor of patent law at Santa Clara University.

“All of its patents were held valid, and all but one were held to be infringed by most or all accused Samsung products. Even better for the company, five of the seven patents were held to be willfully infringed by Samsung.”

Love said this means that Judge Lucy Koh “now has the discretion to triple Apple’s damages award, which is already a monstrous and unprecedented” sum.

The case, which is almost certain to face appeal, could shake up the sizzling market for mobile devices in which Apple has been losing ground to rivals like Samsung that use the free Android system developed by Google.

“Samsung is a proxy for both Google and the other Android vendors and better protected than most,” said analyst Rob Enderle of the Enderle Group.

“I think this will force a reset on Android products as they are reengineered to get around Apple’s patents.”

The jury decided the case with over 700 separate claims in less than three days of deliberations.

In one minor snag, the judge sent them back Friday after discovering they had made damage awards for two devices not found to have infringed, and the jurors then revised the award, which had been $1.051 billion, reports said.

The verdict affects patents on a range of Samsung products including some of its popular Galaxy smartphones and its Galaxy 10 tablet – devices alleged to have been copied from the iPhone and iPad.

But some devices are not affected, including the flagship Galaxy III S recently released, although they could be targeted in separate litigation.

Technology analyst Jeff Kagan said of the verdict: “This is a great day for Apple. And it will turn into a very expensive day for Samsung.”

Kagan said it was not immediately clear if Samsung would be able to continue to use the technology and pay Apple for the right to do so, or if they must pull their devices and redesign them.

In any case, the verdict in the case – one of several pending in global courts – is likely to have massive repercussions in the hottest part of the technology sector, smartphones and tablets.

Even a delay in sales could endanger Samsung’s position in the US market, where it is currently the top seller of smartphones.

A survey by research firm IDC showed Samsung shipped 50.2 million smartphones globally in the April-June period, while Apple sold 26 million iPhones. IDC said Samsung held 32.6 percent of the market to 16.9 percent for Apple.

Samsung had steadfastly denied the charges by Apple, claiming it developed its devices independently, and countersued in the case, seeking more than $400 million for infringement on its wireless patents.

The verdict came the same day a South Korean court ruled Apple and Samsung infringed on each other’s patents on mobile devices, awarding damages to both technology giants and imposing a partial ban on product sales in South Korea.

The court banned sales in South Korea of Apple’s iPhone 4 and iPad 2, as well as Samsung’s Galaxy S and Galaxy SII among other products.