The South Korean group is revealing its technology strategy that affects its entire business, from mobile phones to chips.
Suwon, a town with a population of just over 1 million located near Seoul, was the epicenter of the quake Samsung Electronics It is shaping its future around artificial intelligence. The city that witnessed the birth of the technology company 55 years ago now houses a large number of companies A research and development campus with more than 130 buildingsWhere 37,000 employees work. In this huge complex, where products such as foldable mobile phones, next-generation networks or curved TVs have been developed, the watchword is now Rapid progress in the field of artificial intelligencea technology that affects all of Samsung’s divisions: from mobile phones to semiconductors, including televisions and home appliances.
The group that annually invests more than 19,000 million euros in research and developmentHe sees artificial intelligence as a growth lever that will boost demand for mobile phones, consumer electronics and chips. Company He hopes to recover this year After the difficult year 2023, which was exposed to the memory chip crisis and the slowdown in demand for mobile phones. Last year, Samsung made 259 trillion won (173.4 billion euros), 14% less, with operating profits of 6.57 trillion won (4.4 billion euros), 84% less.
Disagreement with Apple
the Conflict between Samsung and Apple On mobile it will increasingly be fought on the battlefield of generative AI. signature that He regained world leadership Which Apple took over from it in 2023, offering under the Galaxy AI umbrella functions such as instant two-way translation of calls, transcription and summary of audio recordings, photo editing tools, or the possibility of searching the Internet by circling or marking on the screen an area of interest. Your goal is This year, it reached more than one hundred million mobile phones These capabilities It debuted in January on the Galaxy S24 It has been deployed in other models since then.
“This is just the beginning; there will be more services to move toward the future of personal AI,” he promises. Daehyun Kim, Director of the Global Artificial Intelligence Center at Samsung Research. Kim was one of the executives who participated last week in a global media event organized by Samsung at its headquarters to explain its AI strategy, to which EXPANSIÓN was invited.
Samsung is exploring all possibilities. For example, the main user interface of a mobile phone now is the touch screen. But the era of generative AI opens the door to the integration of intelligent assistants with whom we can seamlessly converse via voice in real time. “Voice could be the next big user interfacesays Daehyun Kim, who emphasizes the importance of multimedia AI, capable of processing any type of data to create content in any of these formats.
Kim points out the importance Moving As a device to move towards personalized AI, given the large amount of context information contained within it. “The mobile phone is the best device that offers these functions. There are people who think of some kind Wearable, but we encountered technical issues, such as lack of processing power or autonomy. “Of course, as language models and neural chips advance, who knows what will happen in the future.”
The group is committed toHybrid artificial intelligence“, that is, combining AI functions that run on the device, with other functions that require large models hosted in the cloud. “Moving towards smaller language models will allow us to deliver more and more functions on the device.” He notes that the gradual arrival of affordable chips will help Also on the growth of this market.
Samsung also has a language model
Samsung depends on Special language models Such as Gauss and in third party technology. Use now Google GeminiBut he is open to working with other companies, Kim explains.
The executive says they have made significant investments, which he does not quantify, “in infrastructure, chips, and large language model development,” as well as in visual and small-scale models. Of course, clarify that They do not seek to achieve superior intelligence. They also don’t think about commercializing their language model, which they use internally for tasks like translating and summarizing documents, writing emails or helping with code development.
The group carefully monitors movements Manzana, which plans to announce its generative AI strategy on June 10. “We have been a pioneer in integrating AI into the device,” he says. “It is excellent news that Apple is joining in as well, because it will accelerate the development of a new market.”
The company believes that along with artificial intelligence, an open era for mobile phones. As PP Foresight analyst Paolo Pescatore points out, we are on the verge of “A.” Samsung’s critical sales cycle And the rest of the manufacturers.” According to Counterpoint, mobile phones with generative artificial intelligence will represent 11% of the smartphone market this year.
The group is already seeing signs of calling optimism. In its latest quarterly results, it noted that artificial intelligence functions record “high usage rates and contribute to increasing mobile phone sales.”
According to a Counterpoint report. The Galaxy S24 dominates this new segment, with more than 30% of the market share. “Samsung’s aggressive marketing campaign, focused on highlighting the generative AI capabilities of these models, and its global presence has allowed it to capture 58% of the share of mobile phones equipped with generative AI“The company explains.
Samsung does not plan to ship At least until the end of 2025, for generative AI functions, because its goal is to expand the scope of this type of tool. But the truth is that displaying more and more capabilities of this kind opens the door to a Service business model. “Being a mobile phone manufacturer won’t change, but there will be more and more services,” Kim admits.
The importance of the “slide”
Artificial intelligence also has a lot to say about… Samsung’s semiconductor business, an essential pillar of your money. The group is the global leader in terms of memory chip revenue, and also competes in the third-party semiconductor manufacturing industry.
The South Korean giant announced it in May Replacement semiconductor headwho was replaced by Jun Young-hyun, whom they trusted to overcome what they called the “chip crisis.”
Samsung addresses Challenges in your semiconductor businessWhich shrank in 2023 by 32% to 45,000 million euros, with operating losses of 10,600 million, due to lower prices of memory chips.
The group has fallen behind in this part High Bandwidth Memory (HBM) processors. For artificial intelligence, it stands behind the South Korean company SK Hynix, which supplies the latest generation of these chips (HBM3) to the company. Nvidia. According to TrendForce, SK Hynix It has a 90% stake in this sector.
Jangsuk Choi, director of new business at the memories division, is optimistic about the recovery in demand. “The outlook is good because of the need for memory chips in cloud data centers, devices and cars,” he sums up. “For example, to use applications like ChatGPT, more memory is needed on a mobile phone. Deploying AI in devices could boost the sale of DRAM memories by 41% until 2026,” he explains.
Likewise, it impacts the good business outlook in the HBM sector, highlighting that they have been pioneers in advancements such as 12-layer memories. “Artificial Intelligence in clouds It requires processing units and graphics chips, but also this type of memory processor, due to its better performance and energy efficiency.
“We invest much more than the rest of our competitors in memory chips. Even when the market goes down, like in 2023. Now demand is starting to pick up and we will Expanding production capacitysays Choi.
The company is making strong investments in factories in its country and in United States of AmericaBut so far it has ignored Europe. The United States recently announced that it would support Samsung with $6.4 billion to build a chip factory in Texas. The company expects to invest more than $40 billion in this region in the coming years.
The group has a foundry business (manufacturing for others), with which it competes TSMC and Intel. These three companies are engaged in a fierce battle to develop 2-nanometer chips. The South Korean company, which was the first company to start mass production of 3nm (SF3) chips, sees this new generation as an opportunity to bridge the gap with TSMC.
From TVs to washing machines: everything is equipped with artificial intelligence
Samsung is using artificial intelligence to improve the picture and sound quality of its TVs, an industry it has led for 18 years. For example, this technology allows images to be scaled to improve their size Resolution up to 8K. Model New QLED 8K It also makes scenes with fast actions and movements more fluid and clear thanks to artificial intelligence, according to Moonsoo Kim, director of research and development at Samsung’s visual display division, who highlights other functions enabled by artificial intelligence such as separating dialogues from background noise or the possibility of activating a mode. To save “up to 20% energy without compromising image quality.”
the Custom AI devicesFrom washing machines to refrigerators, they combine vision, sound and artificial intelligence technologies to be more easily controlled and connected. For example, the Bespoke AI Laundry Combo washer/dryer uses artificial intelligence to recommend the ideal cycle or detect fabric and soil levels, add more detergent and adjust the wash time if necessary.
Another priority, explains Muhyung Lee, director of user experience at Digital Appliances Integrating screens into refrigerators, washing machines or ovenswhich thus becomes an easily accessible control point for other devices connected through it Smart stuff. Likewise, it points to the leap represented by generative artificial intelligence, which enables its voice assistant Bixby to understand natural language conversations And not just simple predetermined orders. “It will be necessary to improve the user experience.”
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