Samsung cannot ‘kill’ Taiwan: CEOs

IMPOSSIBLE TASK::Chief executives of Taiwanese tech companies said the diverse nature of the industry prohibits any one company from supplying in all tech needs

By Helen Ku and Lisa Wang  /  Staff reporters

Sat, Mar 23, 2013 - Page 1

South Korea’s Samsung Electronics Co could never take over Taiwan’s tech industries on its own, because of the electronics industry’s diverse nature, Acer Inc (宏碁) chairman and chief executive J.T. Wang (王振堂) said yesterday.

Wang made the remarks in response to a report published by local Chinese-language magazine Business Today on Wednesday, according to which Samsung’s management decided to launch a “kill Taiwan” project in a meeting held after the industry started recovering from the global financial crisis in 2008 and 2009.

The report cited a Taiwanese former Samsung official.

The project aims to drive Taiwanese companies in the PC DRAM sector, LCD panel sector and contract chipmaking sector out of the market, the report said.

“It is impossible” for Samsung to put this project into effect, Wang said.

“The [technology] world is very diverse, consisting of various needs for different products, and different groups of consumers with various preferences,” Wang told reporters on the sidelines of a forum on corporate social responsibility held by Acer in Taipei yesterday.

“No individual company can handle it all,” Wang said. “It is impossible for Samsung to take over Taiwan’s industries.”

Wang added that he doubted the report was true in any case.

Over the past four years, Samsung has gradually forced Taiwanese PC DRAM makers to exit the market and took market share away from Taiwan’s LCD panel makers and mobile phone brand HTC Corp (宏達電), the report said.

HTC lost some market share several years ago because of a short supply of high-resolution displays. Suppliers preferred Samsung over HTC at a time when the supply of high-resolution AMOLED screens was very limited, according to the report.

It added that Samsung is now targeting Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, and Hon Hai Precision Industry Co Ltd (鴻海精密), which makes iPhones and iPads for Apple Inc.

“Samsung is a formidable competitor,” TSMC chairman and chief executive Morris Chang (張忠謀) told reporters. “We will be well-prepared for it.”

Samsung was on his radar several years ago when the South Korean company expanded into the contract chipmaking business.

Samsung is the world’s biggest maker of memory chips and TVs, and is expected to overtake Nokia as the world’s top handset maker this year.

“I’m very optimistic about the company’s [TSMC’s] operations in the short term, medium term and long term,” Chang said.

Continued capacity expansion and increased research and development on DRAM, panels and key components used in smartphones forced Taiwanese and Japanese firms to retreat from those tough markets during the past five years, the report said.

According to the report, the targets of Samsung’s “kill Taiwan” project would include Japanese chipmaker Elpida Memory Inc, as well as Taiwanese panel makers AU Optronics Corp (友達光電), Innolux Corp (群創光電) and Chunghwa Picture Tubes Ltd (中華映管).