Wednesday, October 27, 2004

Samsung Utilizes Existing Resources to Push CCTVs

An hour by subway to Suwon, a city at south of Seoul, houses Samsung Electronics Co., Ltd. headquarters.

Even it is located far from the downtown, the Korean No. 1 conglomerate is not letting down its guard of tight security checks to safeguard the premises.

In the reception area, visitors are prohibited to bring in electronics devices such as digital cameras, camera phones or notebooks, and required to go through X-ray scanning for detection.

These measures clearly lay out the emphasis of Samsung on security.

However, its CCTV business has not garnered much spotlight before in the group, as the sales contribute only a small portion of revenues compared to the other business units, informed Ahn Soon-Hong, senior manager of VSS sales and marketing group of Samsung Electronics Co., Ltd.

But he is confident that this is set to change as some of the top management officials are quite concerned about its potential now.

“We expect the security business to grow, and the social environment indicates that the industry should grow too. It is a common sense that it will be a big business. It is a matter of how and when to unleash its fullest potential and we will continue to focus on this prosperous industry,” Ahn said.

Approaching Market with Strengths

“Security is a concept of the needs of human beings, each company has its solutions to approach the concept,” he added, citing that software giant Microsoft aims to cover the concept through personal computer and networking, and camera manufacturers want to substitute analog matrix switcher with their IP or network cameras with good software solutions.

As such, the growth of the industry will be fuelled with these participations. “We are not that strong in software as Microsoft, nor in processor as Intel, but we are approaching the market with our products, system integration and digital convergence technologies,” he told A&S Magazine.

For now, its main strategy is to sell its strong brand names to the major installers and distributors in each country.

According to him, Samsung can easily utilize its existing infrastructure in Korea, such as high-speed Internet, to develop and push its IP cameras and network DVRs.

Moreover, with the laurels such as the world’s second biggest chip maker and third largest handset maker, Samsung can easily garner its strengths in consumer electronics and information technology, and apply them for its CCTV business.

“We have fair position to compete with other manufacturers,” claimed Ahn.

Growing Strong

In this year, Samsung’s CCTV business is expected to record 20 percent growth than last year, mainly from the DVR and camera line-ups.

Though DVRs are one of its fastest growing products, its time-lapse VCRs are enjoying huge sales in the U.S. projects. He expects the sales of VCRs will drop by half next year, in the course of being replaced by DVRs.

In terms of international markets, the U.S. and major European countries will be the next growth-fuelling engines to its business.

Citing reports from JP Freeman, he said China is one of the fastest growing markets in the world, recording growth rate of more than 16 to 17 percent annually. In terms of size, America is the biggest to Samsung and is stably growing.

“We are watching Russia and we believe it will develop. It could be one of the future potential markets to us,” he added.


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