Samsung Techwin, Now in Hands of Samsung Electronics

Samsung Group announced on August 1 that it will place Samsung Techwin – Samsung Group’s digital camera unit – under the control of the Samsung Electronics. The move is aimed at strengthening the group’s cooperation between key business units in order to maximize synergistic effects.

In line with this reshuffle, Samsung Techwin created a new camera unit that assumed full charge of the digital camera business and assigned Park Jong-woo, Digital Media (DM) business president, to hold two concurrent posts as the DM president and digital camera president.

Moreover, the group made the unusual move of transferring Samsung Techwin’s marketing and technology development departments in Bundang, Gyeonggi Province, to Suwon, Gyeonggi Province, where Samsung Electronics research centers are located. This rare move suggests that the new unit will share in the global marketing organization of Samsung Electronics.

Last year, Samsung Techwin Digital Camera unit achieved 7.8 percent market share to rank fifth in the world; a dramatic growth from 2002 when it failed to make the top ten. Moreover, the unit has successfully secured a 50 percent sales growth in the first half of the year 2007, compared to the same period of last year, drawing attention from other units in the Samsung Group as a thriving business.

“The rearrangement will give wings to the fast-growing digital camera business, allowing it to ascend itself as the world’s # 1 business, with 20% market share by 2010,” explained Samsung Group’s spokesman. “It will help us reach the goal if we can apply Samsung Electronics’ global networks, designs and core technologies to the digital camera unit.”

As part of the reshuffle, Samsung Techwin is planning to consolidate the other four business units including the semiconductor system and the power system into a precision machinery unit. At the same time, it will give shape to the plan to create new energy-based businesses and expand business areas to spy robots and industrial inspection equipment.

The regrouping seemingly aims to break down the walls dividing electronic-related affiliates, build a coordinated and cooperated business environment and sharpen its competitive edge.

Samsung Group has recently appointed Samsung Electronics CEO Kim Jae-wook in charge of technology sector to the post of director of the Display division of Samsung, letting him concentrate all his efforts on developing new models. Moving forward, the group is spurring the restructuring of the company to sharpen its business competitiveness.

“While individual business units within the group emulated each other to stand out in the past, similar units are now grouped into a consolidated unit in order to maximize synergic effects and to use it as a springboard for core businesses in five to ten years,” said an official of Samsung Group.

nex@donga.com