Samsung, LG scramble to adjust to Cook era

http://www.koreatimes.co.kr/www/news/tech/2011/08/133_93554.html

By Kim Yoo-chul The departure of long-time Apple head man Steve Jobs has been mourned by the media and tech geeks around the world. But for Korean technology giants Samsung and LG, which saw their relationship with their American rival becoming complicated, the start of the Tim Cook era at Apple allows hope for a restart. Samsung, which has dual strength in parts and finished products, is a close partner with Apple in components like chips and liquid-crystal displays (LCDs), but a bitter rival in mobile devices like smartphones and portable computers. Apple has been pushing legal action against Samsung, accusing the Korean electronics maker for ``slavishly’’ copying the look and feel of its immensely popular iPhones and iPads in its own handsets and touch-screen tablets. But with Jobs gone from day-to-day business operations at Apple, Samsung officials hope that Cook will be more willing to ink cross-licensing deals to quiet the dispute over design-related patents. LG Display, which competes with Samsung as the world’s largest LCD provider, sees the leadership change at Apple as a chance to strengthen their business partnership. ``A `goodwill’ gesture from Apple is expected soon, although that doesn’t necessarily mean that an imminent cross-licensing deal with Apple will materialize,’’ said a Samsung official, who didn’t want to be named. Samsung officials say Cook isn’t as charismatic as Jobs. He is more of a quiet, no-nonsense leader who is credited for building the structure of Apple’s current supply-chain management system. Cook is also known as the chief architect behind Apple’s global distribution and manufacturing network that allowed it to be a well-oiled machine that continued to pump out iPhones, iPads and Macs across borders. ``Because Cook is open-minded, well-mannered and centered more around strategic thinking, there is reason to believe that he will be willing to build a stronger and more mutually-beneficial relationship with Samsung,’’ said the Samsung source. Cook, formerly Apple’s chief operating officer (COO), met with Samsung’s top brass during his visit to the company in June last year. Samsung officials who have dealt with Cook in the past were impressed with his down-to-earth and practical management style, the Samsung source said. And although Cook may never become the pitchman Jobs was, he has a desire to captivate, industry people say. ``Because Tim Cook was known to have deep interests in `wow’ technologies, chances are likely that Apple may have appetites to look into Samsung’s advanced organic light emitting diode (OLED) displays,’’ said Kim Dong-won, an analyst at Hyundai Securities. Samsung supplies a massive amount of memory chips, displays and lithium-ion batteries to Apple every year. LG glad to see Cook at helm LG Display officials claim they have built ``very good’’ personal relationships with Cook over the years. Cook was treated like royalty when he visited LG’s LCD complex in Paju, Gyeonggi Province, last year. ``I meet Cook at least three times in a year. The most powerful trait that Cook has is that he fully listens and is willing to understand every issue from top to bottom,’’ said LG Display CEO Kwon Young-soo. LG Display has been the most critical partner for Apple in supplying the high-definition ``Retina Displays’’ used on its iGadgets. Retina Displays are expected to continue being used in Apple’s future smartphones and tablets. Apple also buys camera modules from another LG firm, LG Innotek. LG Display has been increasing its shipments of components to make the iPad 2 upon further requests from Apple amid quality problems at Samsung Electronics, according to high-level LG officials. KT, the Korean mobile-phone carrier and the country’s biggest supplier of iPhones, boasts a good relationship with Cook. Cook had backed plans to provide KT handsets that run on WiBro, the Korean equivalent to mobile WiMAX, although Jobs later shot down the idea, KT officials claim. ``KT has proven WiBro technologies. Because Apple is shifting its eyes on external growth in Asia that includes China, Japan and even Korea, it is likely that talks will restart over WiBro-available handsets,’’ said a KT executive, asking not to be identified. It remains to be seen if such rosy estimations prove true as it’s unlikely that Apple will see a big change in terms of management. Korean suppliers who have dealt with Cook’s team say he is an aggressive negotiator, and his team haggles down the price of parts to half a penny. ``He was totally specific in terms of his expectations and I think Cook is polite but strongly-persistent and unyielding in his own asking. But the one clear thing is that Cook understands pending issues in the shortest time,’’ said one executive from one of Apple’s local suppliers. Nam Dae-jong, an analyst at Hi Investment, said Apple will be more favorable to suppliers who sell their components more cheaply and just maintain the ``technical relationship’’ that Apple demands. ``Yes, Apple will have more bargaining power to its key suppliers under the reign of Tim Cook as he knows how to perfectly handle Apple’s SCM systems,’’ said the executive, expecting Cook will be more demanding about on-time delivery and quality.