From the QCOM thread:
Tuesday July 2, 4:06 am Eastern Time
Reuters Company News
Samsung Elec may double 2002 handset investment
(Recasts, adds analyst comments, share moves)
By Nam In-soo
SEOUL, July 2 (Reuters) - South Korea's Samsung Electronics Co (KSE:05930.KS - News) said on Tuesday it may double spending on mobile phone production this year to boost output, defying worries about market saturation and consumer reluctance to upgrade handsets.
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The world's third-largest handset maker raised its 2002 mobile phone sales and market share forecasts last month and analysts said it should meet its targets with slick marketing, quick customer response and sexy colour screens.
"We are considering doubling investment in telecommunications-related facilities to 400 billion won ($333 million) to hike handset output," a Samsung spokesman told Reuters. "But any decision would depend on the market situation throughout the year."
Samsung's plans are in sharp contrast with the dour mood at its bigger rivals Nokia (NOK1V.HE) and Motorola Inc (NYSE:MOT - News).
Finland's Nokia, the world's top handset maker, cut its sales forecasts in June for the second time in two months, citing persistently sluggish demand for mobile phones and networks.
But it reaffirmed its estimates for industry-wide shipments at 400-420 million units this year, largely in line with what others are forecasting.
U.S.-based Motorola, the second largest maker, said on Thursday it will cut 7,000 more jobs and take charges of $3.5 billion as it battles the depressed technology and telecoms sectors.
MARKETING EDGE
"Samsung knows the market doesn't look good. It is not much different from others in forecasting the global handset market," said an analyst at a foreign brokerage in Seoul.
"But when it comes to marketing, Samsung is different. It will be able to meet its annual target without difficulty."
If Samsung raises its mobile output, the spokesman said it would expand plants in China and its factory in Kumi, about 200 km (125 miles) south of Seoul.
Samsung shares finished up 2.6 percent at 337,500 won, outperforming the broader stock index (KSE:^KS11 - News), which was up 0.5 percent.
Samsung expects to sell more than 40 million mobile phones in 2002, up 43 percent from last year, lifting its market share to 10 percent from 9.6 percent in the first quarter and 7.1 percent in 2001.
Its ability to get slick products to market fast helped it rise to third position in the first quarter of 2002, after Nokia with a 34.7 percent market share and Motorola with 15.5 percent, Gartner Dataquest reported.
Samsung ranked fourth in 2001, when the mobile phone industry shrunk 3.2 percent, its first drop in 10 years.
"Samsung's branding know-how beats its competitors. It knows what customers want and offers them faster," said the foreign brokerage analyst, who declined to be identified.
Speed to market is perceived as a weakness for Nokia, which has come under pressure in recent months as Samsung and Sony Ericsson (Tokyo:6758.T - News; Stockholm:ERICb.ST - News) took a lead in colour-screen handsets, analysts said.
Nokia's colour-screen imaging phone, the 7650, with an in-built digital camera, will be available before the end of the month.
Samsung began to ship colour-screen models early this year and unveiled two advanced colour models at the CommunicAsia trade show in mid-June.
The Samsung spokesman said it was considering raising annual handset output capacity at Kumi to 50 million units from 36 million and lifting its capacity in China to about five million from three million units.
It sold 28 million handsets in 2001 and 9.5 million in the first three months of this year.
($1=1201.2 won)
biz.yahoo.com
ALSO:
If this report is accurate, with 2.5 million handsets manufactured, 2.3 million "sold", but only one million subs, all in only the first five months of this year, sure doesn't sound like a handset shortage to me.
BEIJING -(Dow Jones)- Locally owned makers of mobile phones will have 20% of China's market by end-2002, as they continue to boost their market share at the expense of foreign companies, the Ministry of Information Industry said Tuesday.
The ministry said sales by the 30 mobile handset manufacturers it supervises, which include the local operations of market leaders Motorola Inc. (MOT) and
Nokia Corp. (NOK), rose 40% on year to 38.97 million units in the January-May period. Output climbed 36% to 38.92 million.
Sales by Chinese companies rose to 16.2% of the total from 11.9% at end-2001, a development that the ministry singled out for special notice.
"Even though overall a few multinational companies remain the biggest makers of mobile phones, the rapid development of domestic mobile phone enterprises has already begun to shake the hegemony of foreign companies," it said in a report published in China Electronics News.
The ministry predicted that domestic companies would together account for 20% of China's mobile phone sales and output by the end of 2002. It expects total handset output to reach 95 million units this year.
The leading local manufacturers are Shanghai-listed Ningbo Bird Co. (Q.NBB) and TCL Mobile Communication Co., an unlisted company jointly owned by its management, TCL Communication Equipment Co. (Q.TCL) and Hong Kong-listed TCL
International Holdings (H.TCL).
Ranked by January-May sales, Ningbo Bird ranked sixth in China overall with a 4.2% market share, followed by TCL Mobile in seventh place with a 3.9% market
share, the ministry said.
It didn't give the names of the five foreign companies with a larger market share. Based on previous reports, they are most likely to be the China joint ventures of Motorola, Nokia, Samsung Electronics Co. (Q.SSE), Siemens AG (G.SIE) and Telefon AB LM Ericcson (ERICY).
Almost all mobile phones sold in China are based on the dominant GSM, or global system for mobile, standard that is used by both of China's mobile network operators. China United Telecommunications Corp., the parent of China Unicom Ltd. (CHU), this year also started a network that uses the rival CDMA, or code division multiple access, technology.
The ministry's report said 18 of the 19 companies licensed to make CDMA mobile phones have started production. Altogether, they made 2.5 million units in the first five months of the year, with sales of 2.3 million units.
-By Andrew Batson, Dow Jones Newswires; 8610 6588-5848; andrew.batson@dowjones.com |
