TrendForce: Samsung’s AMOLED Products Account for 99% of Market, Component and Brand Business Separation to Accelerate Industry Reshuffling

According to joint findings by TrendForce research divisions, Korean company Samsung Electronics’ global market share across various ICT industry sectors is expected to increase by 2-4% in 2012. Samsung is already a global leader in the consumer product industry, and the maker’s mobile phone market share may reach 30% in 2012.

TrendForce indicates, after Samsung’s spinoff of its LCD display division and merger of its currently stand-alone LED business into Samsung Electronics, there is a possibility the company may also spin off its component business in the future. Not only would this allow Samsung to collect more funds from the South Korean and international markets, but it would enable more flexibility in terms of component business operations. Samsung aspires to become purely an international brand corporation, with a hand in everything from the brand image to the manufacturing process. European, U.S., and Japanese brand makers would have a hard time following suit, as they all lack Samsung’s market share advantage in various sectors.

Moblie Device AMOLED Monopolizes 90% of Market
According to WitsView statistics, in 2011 Samsung had a near monopoly on AMOLED panel shipments, with 99.70% market share. In 2012, although some non-Korean makers have begun supplying AMOLED panels for mobile phone use, Samsung is still estimated to take a high 99.1% of the market.

Percentage of Samsung AMOLED Used in Global AMOLED Tablets

Source: TrendForce

As for the mobile phone industry, Samsung’s market share for mobile phone AMOLED panels reached 96.80% in 2011 and is forecasted to decrease to 96.20% for 2012. Currently, Japanese manufacturer Sony and Korean maker LGD have shipped a small volume of products, but the proportion is insignificant in comparison. In 2012, Taiwanese maker AUO will join the AMOLED battle, but with few product lines, low production capacity, and low yield rate, it is unlikely the newcomer’s presence will have any significant impact on Samsung’s AMOLED market share. At the 2012 Mobile World Congress, all eyes were on the new smartphone models sporting AMOLED displays. Controlled by Samsung, the high-end mobile phone displays will reduce LCD display use in the mobile phone industry.

While tablet PCs are currently in the spotlight, there has yet to be a shipment of tablets equipped with AMOLED displays. However, in 2012, AMOLEDs will officially make their way into the tablet PC industry, marking a new milestone for Samsung as the maturity, yield rate, and economies of scale of the maker’s AMOLED product lines reach the next level. WitsView indicates, even if AMOLED penetration rate only accounts for 2% of the tablet PC market in 2012, Samsung will still be a cut above the rest in terms of production scale and technology. The maker should be able to take 100% of the AMOLED tablet sector, which will in turn further strengthen their AMOLED business.

Percentage of Samsung AMOLED Among AMOLED Smartphones and Tablets

Source: TrendForce

Percentage of AMOLED used in Smartphone and Tablets

Source: TrendForce

Samsung May Take Over Half of the Mobile DRAM Market in 2012
According to DRAMeXchange research data, Samsung’s mobile DRAM market share reached 58.8% in 2011 and is forecasted to break 60% in 2012. The maker’s tablet PC market share may increase from 41.1% in 2011 to 46.5% this year. Not only does Samsung supply the mobile DRAM for its own Android smartphones and tablets, but for Apple’s iPad and iPhone as well. Furthermore, Samsung’s smartphone NAND flash market share will see 4.2% yearly growth in 2012, while tablet PC market share will increase slightly as well, by 0.9%.

Japanese manufacturer Elpida’s recent filing for reorganization proceedings with the Tokyo District Court means that Samsung will have even more of a competitive advantage in terms of mobile DRAM. While the Korean maker still faces strong competition from Japanese maker Toshiba in the NAND flash sector, it will be a rough battle for the Toshiba, as they are unable to compete with Samsung in the home appliance and IT product sectors.

Samsung's Global Market Share in Key Component for Smartphone and Tablets

Source: TrendForce

Consumer Electronics Product Lithium-ion Battery Market Share Already 20-30%
EnergyTrend indicates, Samsung is on par with fellow Korean manufacturer LG in terms of the lithium-ion battery business. Benefitting from the company’s own brand products, Samsung’s Li-ion battery market share has a solid base in the consumer electronics sector. Samsung’s Li-ion batteries will account for 24% of smartphone batteries and 35% of tablet batteries in 2012.

Lithium-ion batteries are one of the most important components in mobile devices, and Samsung already has a solid grasp on the market with its branded batteries. With such success in the Li-ion battery industry, Samsung will also have a leg up when it comes to breaking into the more profitable power battery sector; the company will be an important player in the green energy industry’s energy storage sector.

Samsung Group’s Strategies Deeply Impacts Global ICT Industry, May Divide Component and Brand Business for More Flexibility in Corporate Development
In recent years, Samsung’s rapid market share growth in many different sectors has left little room on the international market for other manufacturers. For instance, Japanese makers going head to head against Samsung in the brand product and component part sectors have suffered the hardest hits in the past few years. Taiwanese makers, on the other hand, have focused on foundry business. However, with the exclusion of wafer, IC design, and low-profit module production, they are still threatened by the Korean maker’s dominance. As for China, its unique situation has turned the market into a battleground for domestic and foreign corporations. However, national brands continue to spring up, hoping to increase the proportion of domestic production in sectors like the component industry. To make up for their technological shortcomings, Chinese makers will still rely on foreign-funded companies, and Samsung’s visibility in China is expected to increase as a result of the group’s strategies.

If Samsung spins off its component business, raising funds on the international market and separating from its brand business, the corporation will be able to reach new heights. The change would likely be welcomed by other international brand companies, as it would be one less area in which to compete against the Samsung brand. If Samsung continues to head in the direction of becoming solely a brand company and is able to successfully overcome the challenge of entering the ranks of heavyweight global brand makers, it will certainly help speed up the reshuffling of the technology industry.