Samsung sees double-digit oper margins - 11th Feb, 2008

Samsung Electronics expects to maintain double-digit operating margins in the medium-term for its handset business, and expects to ship more than 200 million units this year.

David Steel, vice president for marketing at Samsung, said medium-term refers to a roughly one-year time frame. He said maintaining average selling prices for its phones is important even as it sells to emerging markets.

“It does not mean we are opening the gates for cheap products. We need to sell something with more of a premium,” Steel told analysts on the fringes of the Mobile World Congress.

Samsung executives said the company will introduce 11 new handsets at the wireless trade event.

In all, it will ship more than 200 million handset units in 2008, according to Geesung Choi, president of Samsung’s telecommunications business.

Samsung expects to have four or five WiMax phones out this year. WiMax is a wireless technology similar to WiFi but with longer range and stronger signals.

The company says its market share could reach a percentage range in the high-teens if it hits 2008 sales goal, depending on the global market size.

In addition, Samsung hopes to have a phone based on Google’s Android mobile phone software platform by early next year, it said at the Mobile World Congress on Monday.

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Motorola, Nortel in talks to combine units - paper - 11th Feb, 2008

Motorola Inc and Nortel Networks Corp are in talks to combine their wireless infrastructure units, The Wall Street Journal reported, quoting people familiar with the situation.

The talks could create a joint venture with sales of around $10 billion, combining businesses that make network equipment for wireless phone carriers.

Motorola, the world’s third-largest mobile phone maker, which has been losing market share to market leader Nokia Corp and Samsung Electronics Co Ltd, is under pressure from activist investor Carl Icahn to split up and increase value for shareholders. Icahn owns a 5 percent stake.

Any deal between Motorola and Nortel would follow a wave of mergers in the global telecoms sector, as equipment makers combine in a bid to gain economies of scale and more pricing power against telephone carriers that are also merging.

The biggest deal in the telecoms equipment industry was Alcatel-Lucent, whose market value has shrunk by more than $20 billion since a merger in 2006. The French-American group said last week it wrote down 2.94 billion euros ($4.3 billion) against the assets it bought in 2006 and gave disappointing forecasts for 2008.

Motorola shares were up 16 cents, or 1.4 percent to $11.42 and Nortel’s U.S. shares were up 1 percent, or 10 cents, at $11.17 in early trading on the New York Stock Exchange.

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Top Five Mobile Phone Vendors, Worldwide Full Year 2007

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  • Shipments in million
  • Source: IDC Worldwide Quarterly Mobile Phone Tracker, January 25, 2008