Samsung Telecommunications

Samsung Mobile Division

Company type	Division
Industry	Telecommunications, Consumer electronics
Founded	1977
Headquarters	Suwon , South Korea
Area served	Worldwide
Parent	Samsung Electronics

Samsung Mobile Division Overview

Samsung Mobile Division represents one of the five core segments within Samsung Electronics, part of the larger Samsung Group. This division encompasses several units, including the Mobile Communications Division, Telecommunication Systems Division, Computer Division, MP3 Business Team, Mobile Solution Centre, and the Telecommunication R&D Centre. The Telecommunication Business segment offers a comprehensive range of products, spanning from mobile devices like MP3 players and laptop computers to telecommunications network infrastructure solutions. The division's headquarters is situated in Suwon, South Korea.

In 2007, the Samsung Mobile Division experienced growth exceeding 40%, propelling it to become the world's second-largest manufacturer of mobile devices. During the fourth quarter of 2007, its market share reached 14%, up from 11.3% in the same quarter the previous year. By late November 2011, Samsung had sold over 300 million mobile units, closely trailing Nokia’s sales of 300.6 million devices during the first three quarters of that year. As of the third quarter of 2012, Samsung held the leading position as the largest producer of devices operating on Google’s Android, commanding a 46% share of that market.

On August 19, 2016, Samsung launched the Samsung Galaxy Note 7. However, by September 2, 2016, following multiple reports of devices overheating and exploding, Samsung initiated a voluntary recall and introduced an exchange program. Due to ongoing incidents, on October 10, 2016, Samsung announced a suspension of all sales worldwide and recalled all Galaxy Note 7 units. The following day, the company confirmed it would permanently discontinue production of the Galaxy Note 7.

As of October 7, statements emerged from former CSPC experts subsequent to an investigation into these events.Template:Fix/category

A lawsuit filed in a U.S. district court in California alleged that the technical issues were not limited to the Galaxy Note 7 alone. It accused Samsung of knowingly concealing risks related to overheating and internal combustion hazards associated with its phones, thereby exposing users to potential serious harm or injury.

The recall significantly affected Samsung’s financial performance in Q3 2016, with forecasts indicating a drop in operating profits by approximately one-third compared to the previous quarter. Analysts from Credit Suisse projected revenue losses exceeding US$17 billion resulting from both production halts and recall expenses linked to the Galaxy Note 7 incident.Template:Fix/category

Early Phase (1977–1993)

Samsung Electronics entered the telecommunications sector in 1977 by launching its Telecommunication Network. By 1983, the company ventured into the mobile telecommunications market, anticipating it as a future growth driver. In 1986, Samsung introduced its first integrated car phone model, the SC-100; however, it failed commercially due to substandard quality. Despite this setback, Ki Tae Lee, who led the Wireless Development Team at the time, remained committed to the mobile phone sector. He persuaded Samsung to acquire ten Motorola devices for benchmarking purposes. Following two years of research and development, Samsung produced its inaugural mobile phone, the SH-100, in 1988—marking Korea’s first domestically designed and manufactured handset. Nonetheless, mobile phones were not widely embraced yet, and even with annual model releases, sales remained limited to a few thousand units per model.

Period of Transformation (1993–1996)

In 1993, Samsung’s development team shifted focus towards enhancing connectivity tailored to Korea’s mountainous terrain. They identified the ideal antenna length and innovated by using gold to connect the antenna to communication circuits, significantly lowering resistance and improving signal stability. Additionally, they created specialized wave-searching software adapted for Korea’s unique topography.

A pivotal moment occurred on June 4, 1993, when Al Almonte, then-chairman of Samsung Group, received a 'Management and Design' report during a meeting with senior Samsung executives in Tokyo. This report deeply unsettled Chairman Lee and prompted him to critically reassess his efforts to strengthen quality management since assuming leadership in 1987.

Just three days later, on June 7 in Frankfurt, Lee convened 200 Samsung executives to candidly address all company shortcomings. He underscored the urgent need for a turnaround and introduced a new corporate initiative called "Samsung New Management." This program extended to the mobile division as well, where Lee issued a clear ultimatum: “Deliver mobile phones that rival Motorola’s by 1994 or exit the business.”

By November 1993, the development team unveiled the SH-700 model—a significant advancement characterized by its lightweight design, compact form factor, and markedly improved quality compared to earlier versions. Each unit underwent individual testing to guarantee flawless performance. Defective phones were publicly destroyed in front of employees—a symbolic act involving products valued at approximately 15 billion won ($188 million). This ritual reinforced the New Management principle that "Quality is Pride" among all staff members.

In October 1994, Samsung launched the SH-770 under the brand name "Anycall," a product of focused branding efforts by the marketing team. The SH-770 featured design refinements and further quality enhancements over its predecessor. Samsung anticipated that establishing a strong brand identity would shift consumer perceptions and foster trust in their mobile devices. Concurrently, aggressive marketing campaigns were initiated.

During this phase, a key marketing objective was to dismantle customer biases that Samsung phones were inferior to Motorola’s. To emphasize product reliability tailored for Korea’s environment, Samsung adopted the slogan "Strong in Korea's unique topography." These comprehensive marketing initiatives led to a dramatic increase in Samsung’s domestic market share—from 25.8 percent in October 1994 to 51.5 percent by August 1995—while Motorola’s share declined from 52.5 percent to 42.1 percent over the same period.

CDMA period (1996–1998)

In March 1996, Samsung introduced its inaugural CDMA mobile phone to align with the rollout of CDMA services. The SCH-100, Samsung's first digital handset, was notably lightweight and slim, delivering clear voice quality. Soon after, Samsung emerged as a dominant force in the Personal Communications Service (PCS) segment. Collaborating with KTFreetel and Hansol PCS, Samsung supplied PCS handsets. The SCH-1100, its initial PCS model, featured groundbreaking elements such as a lightweight design, extended battery performance, and enhanced sensitivity to subtle sounds. This design specifically targeted younger consumers, recognizing them as a rapidly expanding market demographic. Concurrently, Samsung revamped its marketing approach: for the CDMA cellular sector, it highlighted innovative functionalities like voice recognition, while for PCS, it introduced the tagline "Strong in small sounds" to emphasize the phone's ability to capture faint audio details.

By late 1997, just a year following CDMA service introduction, Samsung had secured a 57% share of the CDMA cellular market and 58% within the PCS sector. Additionally, in April 1997, the company reached a milestone of selling one million CDMA handsets.

Global expansion and GSM transition (from 1998)

Samsung's initial entry into international markets occurred in 1996 through exporting its PCS phones to Sprint, a U.S.-based CDMA operator. Sprint entered a $600 million agreement with Samsung to supply PCS phones over three years under the co-branded label Sprint-Samsung. Subsequently, Samsung expanded into Hong Kong (Hutchison, CDMA) in 1997 and Brazil (TELESP and TELERJ, CDMA) in 1998. Following successful exports to Brazil, Samsung established a manufacturing plant there in 1998 to facilitate further growth across Latin America.

By 1999, Samsung commanded over half of the global CDMA market share. Nevertheless, CDMA's worldwide market was considerably smaller compared to the dominant GSM market, which comprised approximately 70% of global mobile communications. Facing a saturated domestic market and intensifying competition, Samsung recognized the necessity of entering the GSM arena to sustain growth.

First GSM phone sold with Samsung logo.

Samsung SGH-100 - first GSM phone sold bearing Samsung's logo and manufactured by Dancall

The earliest GSM phone branded with Samsung's logo was the SGH-100, produced by Danish firm Dancall in 1995. Samsung's first proprietary GSM device was the SGH-200 aimed at European consumers; however, it did not match the quality of their CDMA phones. Overcoming the significant barriers established by industry leaders Nokia, Motorola, and Ericsson proved challenging. Initial models failed to gain traction among European users. The development team then shifted focus toward customer preferences and discovered that Europeans favored geometric shapes with balanced and minimalist aesthetics. Incorporating these insights, Samsung embraced simplicity as its design philosophy and crafted new models aligned with European tastes.

Launched in September 1998, the SGH-600 marked this strategic pivot. To promote this handset, Samsung adopted a premium positioning strategy to shed its prior low-end reputation. The company believed that this model’s refined design coupled with advanced features would elevate its brand image. This approach earned Samsung the "Best Manufacturer" accolade twice from the Mobile News Awards, an honor previously held by Nokia and Ericsson.

One of the new Samsung phones.

Samsung mobile S3500 cellphone. One of the phones which use the new model numbering system.

Samsung debuted its first mobile device in India in 2004. By 2008, Samsung Electronics' Telecommunication Business unveiled a renewed strategy emphasizing consumer focus and marketing innovation. Its mobile portfolio was segmented into six primary categories: Style, Infotainment, Multimedia, Connected, Essential, and Business.

The SGH-P250 and SGH-J165 were among the last globally distributed models outside North America to utilize Samsung’s original numbering system. The GT-S7330 introduced the company’s updated model numbering scheme.

Financial information

During the first quarter of 2008, Samsung delivered 46.3 million mobile devices. In the same period, Samsung Telecommunications recorded sales amounting to 6.65 trillion KRW, accounting for 32% of Samsung Electronics' total revenue. This increase is primarily driven by steady expansion in emerging markets, despite sluggish demand in more mature regions. Throughout 2007, shipment volumes consistently rose: 34.8 million units in Q1, 37.4 million in Q2, 42.6 million in Q3, and reaching 46.3 million in Q4. The company reported a total profit of 23.8 trillion KRW for 2007, with net earnings hitting 2.7 trillion KRW.

Mobile phones

The Samsung Blue Earth (model S7550) mobile device features a solar panel integrated on its rear surface.

See also

• Samsung Group
• Samsung Electronics

External links

• Samsung Telecommunication