Samsung Electronics is installing its own Touch IC (Integrated Circuit) for its next-generation application Smartphone called Galaxy S7. Samsung Electronics had been using foreign semiconductor businesses’ Touch IC for its high-end Smartphones. Geographical change in this industry is expected due to internalization.
According to industry on the 21st, Samsung Electronics is planning to use its own Touch IC for Galaxy S7 that will be announced next month. Touch IC was developed by Samsung Electronics’ System LSI Business Department, and Samsung Electronics’ Wireless Business Department is going to install it into Galaxy S7.
“Samsung Electronics’ System LSI had been preparing for development of Touch IC for 3 years and it was recently decided that it will be used for Galaxy S7.” said a representative of industry. “There is a high chance that it will be only supplied for Galaxy S7 series.”
Touch IC is a semiconductor that processes signal information by recognizing touch inputs. It is a component that makes touch inputs possible by fingers for Smartphones or tablet PCs.
Samsung Electronics had been using products from Synaptics or ST Micro for its high-end Smartphones such as Galaxy S, Galaxy Note and others. However it is predicted that it will get over its dependence on foreign components by developing its own Touch IC. It can also have power in bargaining for price by diversifying suppliers. Import-substituting effect is also expected due to this.
Because application of touch-input method is expanding towards laptops and monitors and emerging as a main method that will decide user interface (UI) and user experience (UX), Samsung Electronics wanted to speed up process of developing its own Touch IC.
Changes in Samsung Electronics’ strategies will greatly impact parts businesses that it had been dealing with. It is predicted that ST Micro and Synaptics, which had been supplying Touch IC for Galaxy Note, Galaxy S Series and others, will receive direct hits from this. These businesses now face situation where they have to now compete against Samsung Electronics’ System LSI Business Department.
Impacts will be greater if Samsung expands internalization of Touch IC towards low and medium-priced phones in medium and long-term because it will affect its partners in South Korea also.
“Although there will not be direct affects since markets are different, it will be an unfavorable factor in medium and long-term.” said a representative of a business that supplies Touch IC for low and medium-priced phones.
“Detailed information regarding development and products that are applicable cannot be checked.” said a representative of Samsung Electronics regarding Touch IC.
Staff Reporter Yun, Kunil | firstname.lastname@example.org (specializes in electronics and parts) & Staff Reporter Han, Juyeop | email@example.com (specializes in semiconductor)