Samsung Also Wants to Visit Origin

Meanwhile, the atmosphere at Samsung's mobile phone R&D center was entirely different.

In Gangnam District, Korea, the conference hall in Samsung's headquarters building was also filled with company executives.

Seated at the head was Samsung's third-generation leader, Lee Jae-yong.

Lee Jae-yong became president of Samsung Electronics in November 2010 and vice chairman in December 2012.

He was currently a director of Samsung Electronics.

Speaking of Samsung Group, among Korea's famous four major conglomerates, Samsung Group was the most powerful. It was involved in nearly every industry in Korea, with its main businesses including electronics, finance, chemicals, communications, hotels, and commercial services. It could be said that Samsung was everywhere in Korea. In terms of reach, there were three things Koreans could not avoid after being born: death, taxes, and Samsung.

Samsung was even more dominant within Korea itself. One out of every hundred Koreans was a Samsung employee.

Adding in the other companies, families, and connections linked to it, its scale became even more massive.

Furthermore, Samsung's annual average sales stood between 2.6 trillion and 3 trillion Citibank Currency, accounting for roughly one-quarter of Korea's annual GDP! It could be said that Samsung affected the entire country with a single move. Whether Samsung performed well or poorly could directly influence the rise and fall of Korea's economy.

Some even believed that Samsung was Korea's "second government."

The Samsung people usually encountered was merely "Samsung Electronics." Yet Samsung Electronics alone already dominated the global consumer market. Setting aside its strength in displays and semiconductors, its smartphones and other smart terminals were also performing well. For instance, although Samsung phones retained only a 0.8% market share in China, they still held more than 20% of the global market, making Samsung the world's largest phone manufacturer. In addition, Samsung's home appliance businesses, such as televisions and air conditioners, were also highly prominent.

Whenever the Samsung brand was mentioned, many people probably thought first of Samsung phones, since they were what people encountered most often. However, Samsung phones were only one business and brand under Samsung Group.

Samsung phones were smartphones developed by Samsung Group. Samsung phones truly began becoming popular worldwide with the A Series. The A Series had originally been a line of flip phones, and early models such as the Samsung SGH-A188, with its white exterior, and the SGH-A288, with its dual internal and external screens, were both classics.

The Galaxy Series could be called Samsung's most successful phone series to date. Across the entire Galaxy lineup, Samsung used the Android smartphone operating system.

Among them, the Galaxy S naming line represented Galaxy's flagship models. Another line was the Galaxy Nexus, the newest generation of Google-branded phones manufactured by Samsung for Google. The Galaxy S line included five major series: Galaxy S, Galaxy SⅡ, Galaxy SⅢ, Galaxy S4, and Galaxy S5. Every Galaxy S Series phone sold more than ten million units.

In the month or so since the Galaxy Note7 was released, more than thirty explosions and fires caused by battery defects had occurred worldwide.

This incident had caught Samsung completely off guard.

They had originally expected this phone to compete head-to-head with Apple Inc., and it had been one of Samsung's proudest creations.

This "masterpiece" of Samsung's had certainly made Samsung famous—but that was not the result they wanted.

A passenger plane on Flight 994 caught fire after a Samsung Galaxy Note7 began smoking and ignited. Fortunately, all passengers and crew members were evacuated in time, and there were no casualties.

The incident seemed to light the fuse on the Note7. After that, reports of phones exploding kept pouring in.

For a time, the world was in uproar. Samsung phones had been such a major brand, yet such a severe design flaw had actually been manufactured and sold openly. Samsung's reputation was destroyed overnight.

The cause of the accidents turned out to be a design defect!

Because the Note7's battery capacity had been increased from the previous Galaxy Note5's 3000mAH to 3500mAH, while the Note7's curved-screen design did not provide any more usable space than the Galaxy Note5. Furthermore, the 2K screen consumed a great deal of power. To ensure battery life without increasing the phone's thickness, Samsung removed a row of fixing screws from the middle frame of the battery compartment during design. The protective compartment at the battery's tail end, where problems were most likely to occur, was incomplete. After an impact, the battery could shift around, and impacts to its tail end could easily rupture the separator, causing the positive and negative terminals to short-circuit and trigger a fire or explosion.

The company then made two fatal mistakes.

The first mistake was failing to identify the true cause of the explosions immediately. Since the domestic version used ATL batteries while overseas versions used Samsung's own SDI batteries, and the earliest explosions had mainly occurred in overseas versions, Samsung hastily blamed SDI's batteries. It recalled the overseas models, replaced all their batteries with ATL batteries, and declared that the domestic versions had no issues. As a result, many users believed Samsung was treating them differently.

The second fatal mistake was that, after the domestic models using ATL batteries also began exploding, Samsung did not seriously reinvestigate the cause. Instead, it suspected that a domestic manufacturer had hired people to heat Galaxy Note7 phones in microwaves in order to smear Samsung. Only after domestic explosions became increasingly frequent and overseas Galaxy Note7 phones that had been recalled and fitted with ATL batteries exploded again did Samsung urgently halt sales and thoroughly investigate the real cause. By then, however, it was too late. Its brand reputation plummeted, and it even dragged its own SDI down with it.

In the end, Samsung mobile division president Koh Dong-jin bowed and apologized.

But it did not restore consumers' trust. A crisis of trust was a matter of life and death for every company!

The company had also decided to recall every phone already sold and permanently cease the production and sale of Galaxy Note7 smartphones, hoping to bring one of the most shameful incidents in its history to an end as soon as possible.

At this critical moment, Origin Mobile suddenly became famous, showing signs of overshadowing the Samsung phone explosion scandal. This also made Samsung's management breathe a sigh of relief.

After Kwon Gwi-hyun, Samsung's Asia regional president, brought the Origin Mobile back, Samsung dismantled and studied it as well. However, the results were astonishing and unexpected.

Faced with such a surprise, Lee Jae-yong did not rush to respond as Apple Inc. had, because Samsung phones currently had an extremely poor reputation. This also gave Lee Jae-yong a new idea.

After all, Samsung phones and Apple Inc. had been at odds for a long time. They could practically be said to love and hate each other.

Since Samsung and Apple Inc. began their patent lawsuits in April 2011, they had filed litigation in nine countries over twenty patents, each accusing the other of infringing on its patent rights.

On October 17, 2011, a US judge found that Samsung had infringed Apple Inc.'s patent rights.

In August 2012, a California district court in the US issued its first-instance ruling, stating that Samsung Electronics had infringed several Apple Inc. patents and had to pay the other side 1.05 billion Citibank Currency in damages. Samsung objected and filed an appeal. On December 7, 2012, Apple Inc. and Samsung Electronics would appear again before a federal court in San Jose to retry this high-stakes lawsuit for both sides. On December 19, 2012, Samsung withdrew its patent infringement lawsuits against Apple Inc. in European countries. Samsung Electronics won a round in its bare-knuckle patent war with Apple Inc. The US International Trade Commission ruled that Samsung's products infringed on Apple Inc.'s rights, and some older Samsung Electronics models would be barred from import and sale in the US.

In October 2013, US President Obama ultimately did not veto the sales ban. Some Samsung smartphones and tablets would be banned from the US market, including the Galaxy S, Galaxy S2, and Galaxy Tap. Previously, the US International Trade Commission had ruled that older Samsung smartphones infringed two of Apple Inc.'s commercial patents and prohibited related Samsung products from being imported into the US. Samsung had asked Obama to veto the ITC's ban on public policy grounds, and the ITC had also submitted the penalty to Obama for final judgment.

On November 21, 2013, a jury at the San Jose District Court in California ruled that Samsung Electronics, which had infringed Apple Inc.'s patents, should pay Apple Inc. 290.45 million Citibank Currency in compensation. Apple Inc. had previously sought 379.8 million Citibank Currency, while Samsung Electronics argued that it should pay only 52.7 million Citibank Currency.

In December 2015, after five years of trials, reviews, and appeals, Samsung stated that it agreed to pay Apple Inc. 548 million Citibank Currency. However, if the US Patent and Trademark Office found Apple Inc.'s patents invalid, Samsung would demand the compensation be returned.

On November 25, 2012, news emerged that Samsung had once again stopped supplying Apple Inc. with a key component: batteries used in iPads and MacBook laptops.

As early as October, Samsung had begun halting its supply of LCD displays to Apple Inc. This had a profound impact on Apple Inc., because Samsung was the largest supplier of displays for Apple Inc.'s mobile devices, delivering tens of millions each year.

This phone explosion incident cost Samsung 17 billion Citibank Currency.

With no other choice, Samsung prepared to go to the US to upgrade its software. This was no different from yielding to Apple Inc.

However, the rise of Origin Mobile allowed Samsung to see another kind of hope.

After analyzing Origin Mobile, Samsung also realized that, whether in software design or hardware manufacturing processes, Origin Mobile had comprehensively surpassed Apple Inc. in the US, let alone Samsung itself.

What supported Samsung Electronics' rapid growth was its design philosophy of leading cutting-edge technological trends. Since 2006, Samsung Electronics had won a total of 210 awards in internationally authoritative design competitions and received high recognition in the design field. Samsung won eight awards at IDEA in 2009, becoming the company with the most honors, and the same was true at iF.

In the second-quarter 2010 DRAM rankings, Samsung Electronics had consistently maintained its leading position. Gartner stated in a report that Samsung Electronics' market share exceeded 35%, further consolidating its market position.

Therefore, Samsung's mobile division also decided to suspend its plan to go to the US for a software upgrade. Instead, it would head to Origin Company in China to seek cooperation.

Lee Jae-yong made the final decision. He would personally lead a delegation to visit Origin Company and seek a breakthrough.

Chu Feng also received Samsung's request for cooperation. After pondering it for a moment, he approved it.

Samsung possessed unique advantages in screens and semiconductors. He could not possibly handle every aspect himself, nor could he produce everything on his own. There were too few production lines on his automated assembly platform; if he needed other things in the future, he could only rely on atomic 3D printing, while having the Engineering Robots assemble them themselves was too slow. Besides, having allies would make the road ahead easier.

Checking in at 3,000 words, day 27. Friends who wanted to invest could go for it now???? You would not be disappointed.