Samsung eyes Sony in gadget market

In a bid to make a larger mark in the consumer-electronics market, Samsung Electronics kicks off a multimillion-dollar advertising campaign in New York's Times Square.

Richard Shim Staff Writer, CNET News.com
Richard Shim
writes about gadgets big and small.
Richard Shim
2 min read
In a bid to make a larger mark in the highly competitive consumer electronics market, Samsung Electronics on Thursday kicked off a multimillion-dollar advertising campaign in New York's Times Square.

A 41-foot wide, 65-foot tall billboard in New York's flashy commercial center is just one part of the company's $200 million worldwide advertising push. Samsung will dedicate an estimated $70 million to North American advertising alone. Overall marketing expenses will exceed $900 million in 2002--a 21 percent increase from last year, according to the company.

The Korean company is one of the largest producers of memory chips, flat-panel displays and cell phone handsets in the world, and it also supplies parts to such big names as Dell Computer, IBM and Hewlett-Packard. Yet as the PC market suffers and companies cut back, Samsung has sought to expand to other markets, most recently working to establish itself as a premium consumer-electronics brand.

This, however, is no easy feat. Samsung will have to go head to head with leading consumer-electronics companies such as Sony and Philips, which continue to fight between each other for a greater share of the growing market. NPDTechworld analyst Stephen Baker says the consumer-electronics market has done over $30 billion in business between September 2001 and February 2002 alone.

Samsung representatives were not immediately available for comment, yet executives in the past have touted the company's willingness to jump into the market.

"Samsung is well-positioned to accelerate the digital convergence revolution into our business core competencies, which includes consumer electronics, computers, communications and core components," Samsung Electronics CEO Daeje Chin said earlier this year at the Consumer Electronics Show in Las Vegas. Products that Samsung is exploring for the U.S. market are a tablet PC device, called the Nexio, and a home entertainment PC.

"Samsung is pushing concept devices...more so than they did just 5 years ago," IDC analyst Randy Giusto said. "They're starting to act more and more like a mature high-tech company."

Yet other analysts are wary. Baker said that there was a limited opportunity for a new premium brand in the high-end consumer electronics world.

"Sony has a unique spot in the business that has been built up over the years," said Baker.