November 10, 1999 in Social Responsibility News

SAMSUNG Electronics Launches Digital Multimedia Platform Worldwide

Company Introduces Portfolio of 30 New Digital Products, Anticipates $58 Billion in Digital Sales By 2005 NEW YORK--(BUSINESS WIRE)--Nov. 9, 1999-- $1.4 Billion Plus in R&D Investment Targets Generations Y and N Consumers as Key to Digital Connectivity.

In its ongoing bid to lead the digital convergence revolution, Samsung Electronics today announced a massive introduction of new products and a new brand slogan - "Samsung DIGITall: everyone's invited" - that reflects the company's drive to integrate digital home, mobile and personal multimedia on a global scale.

Samsung Electronics said its goal is to become one of the top three digital product suppliers in the world, focusing on four core markets: personal multimedia, mobile multimedia, home multimedia, and core component business.

The company projects that its new digital products will generate total sales of $58 billion by 2005, with an average annual growth in sales of 15 percent. To support its digital offerings, the company anticipates an R&D investment of more than $1.4 billion in the next five to 10 years. The firm invested $80 million in digital product R&D in 1999 and will invest $315 million in 2000.

"Our new product portfolio reflects a basic shift in strategy, demonstrating our deep conviction that digital connectivity is the future of our industry, especially in terms of personal and mobile multimedia products," said Jong-Yong Yun, president and CEO of Samsung Electronics. "Samsung is ideally suited to shape this digital revolution, due to our leadership in consumer electronics, telecommunications and semiconductors, and to the unique integration we have pioneered among these fields for years."

The company's multimedia strategy is designed to initially leverage Samsung Electronics' new digital SmartMedia (TM) card, scheduled for introduction in first quarter 2000. The card's 32MB memory capacity provides storage for video and audio data downloaded from the Internet, data copied and stored from packaged media, and even personal recordings and other business data.

All of the company's new personal and mobile multimedia products will feature the SmartMedia(TM) card performance option. As wireless communications protocols are established, this innovative sharing of data will likely be enhanced by removing the hard media option, relying instead on wireless connectivity.

Products available in the United States in fourth quarter 1999 are: The SCH-3500, the world's first Code Division Multiple Access (CDMA) PCS portable telephone that combines voice-activated dialing and Internet access in a small, sleek package. The SCH-3500 weighs 5.5 ounces with e-mail and wireless fax capabilities, and is priced at $149.

The Yepp YP-E32 and YP-E64, a portable digital audio player featuring the MP3 audio compression format, priced at $169.99 and $249.99 respectively. The player has both removable SmartMedia(TM) card functionality and 32 MB or 64MB of built-in flash memory.

Products available in the United States in first quarter 2000 are: Photo Yepp, a portable MP3 player that displays still graphics and lyrics, priced at $399.99.

Digital Still Camera (SDC-80), a brightly colored digital camera in a translucent case, providing 850K pixel resolution and SmartCard(TM) memory, priced at $349.99.

SyncMaster 170MP, a 17 inch TFT LCD TV monitor with built-in TV tuner, featuring digital zoom and image quality control filters, and targeted to high information-demand environments such as news organizations and financial and stock markets, priced at $3499.99.

Digital Still Camera (SDC-007), a higher-end digital camera featuring a folding and swivel LCD panel, priced at $599.99.

Products available in the United States in second quarter 2000 are: The Yepp New E, a ``hip hop'' design portable digital audio player with SmartMedia(TM) card functionality and 32MB of built-in memory, priced at $199.99.

The Yepp New D, a high-end portable digital audio player, featuring 32MB of built-in memory and 3D sound, also with SmartMedia(TM) card option, priced at $249.99.

Motion Yepp, a portable MP3 player offering digital stereo sound and the ability to store and display both still and motion pictures, such as music videos, song lyrics and singer profiles, with SmartMedia(TM) card functionality, priced at $499.99.

Digital Photo Album (SyncMaster 80), an updated photo display for the Digital Age, resembling a conventional photo album, but presenting digital images stored via SmartMedia(TM) card in a variety of styles, including slideshow animation and music accompaniment, priced at $799.99.

43" fLCD HD-Ready Projection TV, an advanced LCD projection TV with Samsung's proprietary optical engine technology offering 720P x 1280 high definition resolution, priced at $5999.99.

Colour Station (SCX-1000S), a multi-functional color printer with pre-programmable Internet printing capability, priced at $499.99 without SmartMedia(TM) card capability and $599.99 with SmartMedia(TM) functionality.

Product available in the United States in third quarter 2000 is: DVD Recorder (DVR-2000), one of the first DVD players with a DVD-RAM format, offering recording as well as playback, and featuring a rewritable optical disc and built-in MPEG-2 encoder and decoder, as well as high-resolution component video output terminals (Y, Pb, Pr), priced at $1999.99.

The remaining products from the new digital product suite will be introduced in the United States at later dates or, in limited cases, distributed in Asia only.

"Our progressive multimedia products are designed for people who are comfortable with computers and with the Internet, who are mobile and constantly in touch," said Mr. Yun. "It's clear that the consumer of the future will demand total digital connectivity anytime and anywhere, and Samsung is committed to defining the extraordinary potential of this emerging Digital Age."

To date, the company has invested $3 million in market research identifying the lifestyle and purchase patterns of Generation Y (13-25 years old) and Generation N (Internet-friendly) consumers. The company also has invested $100 million this year in online marketing of its new brand and product portfolio, with an additional $200 million slated for online marketing in 2000.

In addition, the company has allocated $150 million for U.S. advertising campaigns to promote the new digital brand through year 2001, including Olympics-themed advertising scheduled to begin in 2000.

The new brand slogan - "Samsung DIGITall - everyone's invited" - debuted with national TV pots during the World Series telecasts in late October.

With its massive investment in digital media, Samsung Electronics anticipates a significant realignment of its four business sectors in a single year (year 2000).

Telecommunications Business, which includes mobile multimedia and now comprises 23 percent of Samsung Electronics' revenues, is expected to increase to 25 percent of total company sales. Consumer Electronics Business is expected to drop from 21 percent to 17 percent of total sales, and Computer & Peripherals Business will rise to 24 percent from 21 percent.

Semiconductors Business will decrease from 35 percent to 34 percent of total sales.


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