Samsung Electronics board signs the spin-off of its LCD unit, to focus on OLED development
LCD screens have long lost their novelty status, hence their high profit margin. Everyone can start making them, albeit with varying degrees of success, but there is no high entry barrier as there was before.
Struggling with losses in its LCD unit, Samsung Display Company, Samsung Electronics' board of directors today signed the paperwork to spin off the firm into a separate entity, after it bought out Sony's part of the LCD joint venture last year. Faltering demand and falling prices for LCD TVs have hurt the world's largest TV maker to the point that now it doesn't want anything to do with the pesky LCD business, starting April 1.
"The spin-off will allow us to make quicker business decisions and respond to our clients' needs more swiftly. Through enhancements in business competitiveness, we will continue to provide superior products and services for the market", said Donggun Park, executive vice president and head of Samsung's LCD business.
Translation - we'll keep making LCD panels, but our focus is about to move elsewhere, most likely Samsung's OLED display business. There it has a near monopoly on the market, with about 90% of the supply, and its new factory can finally crack enough of those sweet OLED screens to benefit from economies of scale. If that means more high-def slim AMOLED goodness in our smartphones and tablets we'd say bring it on.