This article was published on October 2, 2012

Samsung officials hint at ‘aggressive’ focus on China market

Samsung officials hint at ‘aggressive’ focus on China market
Josh Ong
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Josh Ong

Josh Ong is the US Editor at The Next Web. He previously worked as TNW's China Editor and LA Reporter. Follow him on Twitter or email him a Josh Ong is the US Editor at The Next Web. He previously worked as TNW's China Editor and LA Reporter. Follow him on Twitter or email him at [email protected].

Several Samsung officials have spoken off the record with The Korea Times to explain the company’s strong focus in building its reputation there as both an employer and a brand.

“As you know, we have been very aggressive in facility investment and have been holding high-profile business meetings with Chinese companies and policymakers. Yes, we want to be bigger in China than Apple,” one official told the paper.

The report’s sources indicated that Samsung’s upper echelons have reached a “broad consensus” that it needs to strengthen its China business.

“Another Samsung executive said that if the company strengthens its position in China it will also help it guard against this possibility should Apple decide to bring the intellectual property dispute to the country,” the Times noted.

The executive qualified that Samsung’s actions in China aren’t “all about Apple”, but that the company is hoping to have a better position.

Samsung’s investing heavily in China on several fronts. It recently broke ground on a $7 billion flash memory factory in Xian. The facility, which will be capable of producing up to 100,000 chips a month, should be up  and running by the end of next year.

Like Apple, Samsung has faced criticism over labor conditions on the Mainland. Last month, a labor group accused the Korean electronics maker of rights violations, including underage workers and excessive overtime. Samsung responded quickly with an audit of its facilities that found some violations but no child workers.

According to the Times, Samsung’s China division has set its sights on $100 billion in annual revenue, up from $60 billion. The company is also said to have strengthened its relationship with government officials and prominent business leaders.

“Samsung is gaining trust and support from China. We are more than positive that will help us get lead over Apple in next patent disputes in China,” an official said.

As it has fought its way to the top of the mobile industry, Samsung has established a loyal user base in China. Its Galaxy smartphones are some of the most sought after devices in the country, especially its Galaxy Note phablet.

Data from Chinese analytics firm Umeng shows that Samsung is the top Android maker in China with an estimated 24 percent share of devices on the platform in the second quarter of this year. Its Galaxy Ace phone was the top device during the period, accounting for over 4 percent of Android devices.

Samsung isn’t likely to have the market to itself, however, as rival Apple has also expressed its interest in China. For several years now, the company’s top executives have pointed to the country as a key area of focus for its business.

“We’ve been very focused on China because we see it as an enormous opportunity for us. I’m very pleased that we were able to grow our iPhone sales over 100% last quarter,” CEO Tim Cook said during Apple’s most recent earnings conference call.

The fierce rivalry between Apple and Samsung has grown stronger as it has spilled over into the coatroom. As both companies undertake the challenge of employing China’s manufacturing industry to produce gadgets that they can then sell to its growing middle class, expect that competition to continue to heat up.

Image Credit: Justin Sullivan / Getty Images

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