Samsung spins off display unit. Sony, Toshiba, Hitachi respond creating Japan Display Inc.
Samsung has announced that it has completed the spin-off of its display unit into a new corporation, called Samsung Display Co., Ltd. It has been spun off from Samsung Electronics, and will be incorporated tomorrow. It will begin business operations thereafter.
Samsung’s display unit (now the separate company) is the world’s biggest LCD display producer. It made about $20 billion in revenue last year. It has 20,000 employees and five factories. Further, on July 1 Samsung Display will merge with Samsung Mobile Display, the group’s OLED arm.
The spin-off undoubtedly comes as a reaction to the display unit’s recent losses, which made the results of Samsung Electronics overall look less stellar than they might have been had the display unit not been a part of it. So from now on, expect much improved financial results from Samsung Electronics. As for the newly established Samsung Display, going at it alone (yet still part of the Samsung group) will hopefully have some advantages in terms of its moving as fast as is needed to stay afloat in an industry that isn’t very profitable anymore.
Samsung’s competitors in the display space aren’t sitting idly by, however. In fact, coincidentally (or, probably not), some of the biggest ones based in Japan have just formed a new joint-venture. It’s called Japan Display Inc. (JDI) and has been formed by Sony, Toshiba, Hitachi, and the Innovation Network Corporation of Japan.
While Samsung Display will make everything from smartphone screens to big televisions, JDI will be focused just on small to medium-sized displays – and those for smartphones and tablets in particular.
JDI aims to make OLED displays, the biggest producer of which at the moment is Samsung Mobile Display. JDI will have distribution companies in the US, Europe, South Korea, China and Taiwan, and wants to get off the ground running.
JDI is basically made out of the small to medium-sized display units of Sony, Toshiba, and Hitachi – joined. That will make it one of the big competitors to Samsung Display.
The establishment of JDI will help some of Samsung’s competitors in the smartphone and tablet space have a decent supplier alternative to the South Korean company. HTC, for example, had some problems a couple of years back, when Samsung prioritized OLED display deliveries to its smartphone making division, and left other customers such as HTC facing shipping delays because of reduced capacity factories.
Those days are behind us, but it surely is a breath of fresh air for some mobile device makers that they now have a pretty big alternative to Samsung when it comes to top notch displays.