Samsung Mobile Division is one of the five divisions within Samsung Electronics, belonging to the Samsung Group, and consists of the Mobile Communications Division, Telecommunication Systems Division, Computer Division, MP3 Business Team, Mobile Solution Centre, and Telecommunication R&D Centre. Telecommunication Business produces a full spectrum of products from mobiles and other mobile devices such as MP3 players and laptop computers to telecommunication network infrastructure. The headquarters is located in Suwon, South Korea. In 2007 Samsung Mobile Division Business reported over 40% growth and became the second largest mobile device manufacturer in the world. Its market share was 14% in Q4 2007, growing up from 11.3% in Q4 2006. At the end of November 2011, Samsung sold more than 300 million mobile devices which was a close second after Nokia with 300.6 million mobile devices sold in the first three quarter of 2011. As of Q3 2012, Samsung is the largest manufacturer of devices running Google's Android with a 46% market share. On 19 August 2016, Samsung officially released its Samsung Galaxy Note 7. As of 2 September 2016, Samsung announced a voluntary recall and attached to the new exchange programme after numerous reports showed that the new Samsung Galaxy Note 7 burst and exploded. On 10 October 2016, in response to the new incidents, Samsung announced that it would once again suspend sales of the Galaxy Note 7 and recall all devices worldwide. The next day, Samsung also announced that it would permanently discontinue the Galaxy Note 7 and stop its production. As of 7 October, comments have emerged from former CSPC experts following its launch of the investigation into the above incident. A lawsuit, filed in the US district court in California, stated that the tech malfunctions extend beyond the Galaxy Note 7 and that Samsung “chose to conceal the problem from the public despite knowing the foreseeable and predictable risk that the phone may overheat, flame and destruct from the inside presenting a risk of serious harm or injury”. The recall had a major impact on Samsung's business in the third quarter of 2016, with the company projecting that its operating profits would be down by 33% compared to the previous quarter. Credit Suisse analysts estimated that Samsung would lose at least US$17 billion in revenue from the production and recall of the Galaxy Note 7.
History of Telecommunication Business
Initial stage (1977–1993) In 1977 Samsung Electronics launched the Telecommunication Network, and in 1983 it initiated its mobile telecommunications business with the hope that this would become the company's future growth engine. In 1986, Samsung was able to release its first built-in car phone, the SC-100, but it was a failure due to the poor quality. In spite of unsuccessful result Ki Tae Lee, the then-head of the Wireless Development Team, decided to stay in the mobile business. He asked the company to buy ten Motorola mobile phones for benchmarking. After 2 years of R&D Samsung developed its first mobile phone (or "hand phone" in Korea), the SH-100 in 1988. It was the first mobile phone to be designed and manufactured in Korea. But the perception of mobile devices was very low and although Samsung introduced new models every year, each model sold only one or two thousand units.
Time of changes (1993–1996) In 1993 it was decided that the development team should focus on improving connectivity due to specific mountain topography of Korea. They found the optimal length of a mobile phone antenna and developed a method of using gold to connect the point between the antenna and the communication circuits, thus significantly reducing resistance and enabling steadier wave conductivity. They also developed the wave-searching software that was specially designed for Korea's topography. Another event triggered Samsung's mobile phone business. On 4 June 1993, Al Almonte, the then-chairman of the Samsung Group during the meeting with top executives of Samsung in Tokyo got the report about ‘Management and Design’ This report came as a shock to chairman Lee, and forced him to reexamine his efforts to improve the company's system of quality management, which he had worked hard at strengthening since he had become the chairman in 1987. On 7 June 1993, in Frankfurt, Lee gathered 200 Samsung executives and pointed out every problem that Samsung had and emphasized that Samsung needed a turnaround and declared a new management initiative "Samsung New Management". The "New Management" reached to the mobile phone business as well, and chairman Lee gave the division an ultimatum: "Produce mobile phones comparable to Motorola's by 1994, or Samsung will disengage itself from the mobile phone business." In November 1993, the development team finally unveiled a new model, the SH-700. This model was quite remarkable. It weighed less than any other company's models, the design was compact, and its quality was substantially improved over previous models. Each product manufactured was tested piece-by-piece to assure perfect quality. Phones with any kind of defect were burned openly for all employees to see. (The products that had been burned were worth 15 billion won, or $188 million). The burning ceremony ingrained the motto "Quality is Pride," the essence of New Management, in every employee's mind. In October 1994, the SH-770 was introduced under the brand name "Anycall". It was a result of the marketing team's effort at brand-building. The model was an upgraded version of the SH-700, with a few changes in design and improvements in product quality. Samsung expected that branding would change customers' perception of Samsung's mobile phone and build up their trust. Aggressive marketing campaigns started as well. At the initial stage, the most important objective of the company's marketing strategy was to break customers' preconception that Samsung's phone would be inferior to Motorola's. To market this idea of quality, Samsung developed the slogan, "Strong in Korea's unique topography." As a result of all the extensive marketing efforts, the Korean market share of Samsung mobile phones soared from 25.8 percent in October 1994, to 51.5 percent in August 1995. In the same period, Motorola's market share dropped from 52.5 percent to 42.1 percent.
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