Samsung retains J.K. Shin as mobile chief amid management shakeup

Samsung Group decided to keep J.K. Shin as one of the three co-CEOs of Samsung Electronics and maintain his role as the head of the company's important mobile division. There had been rumors that Shin might lose his position as a result of weakness in the company's smartphone business, but Samsung appears to be staying the course as it works to revitalize sales and profits.

Shin kept his role along with B.K. Yoon, who leads Samsung's home-appliance and TV units, and Kwon Oh-hyun, who manages the company's components unit and thus has responsibility for the firm's semiconductor and display-panel businesses.

"J.K. Shin has made big contributions in making Samsung Electronics the No. 1 maker of mobile phones," June Lee, the head of corporate communications at Samsung's Corporate Strategy Office, told a group of reporters at a briefing following the announcement, according to the Wall Street Journal. "The scope of personnel reshuffling is narrower than it has been before," he said, adding that Samsung Electronics as well as other groups in the larger Samsung conglomerate reported relatively weak results in 2014.

The WSJ had reported last week that Shin might lose his role as co-CEO and that Yoon might take over the mobile unit. However, Shin will now be entrusted with reviving Samsung's smartphone business amid intensifying comeptition. Shin has led the unit since 2009, when Samsung started its rapid ascent to smartphone dominance, but has come under increasing pressure this year amid tougher competition from the likes of Xiaomi and Lenovo.

Some Samsung mobile executives are either being axed or changing duties, according to reports. According to both Yonhap News, which did not cite sources, and the Journal, which cited unnamed sources familiar with the matter, Samsung executive D.J. Lee is leaving his current position, taking responsibility for weaker smartphone sales. Lee, president and head of sales and marketing for mobile, has been one of Shin's top lieutenants, the Journal noted. It wasn't immediately clear who would replace Lee, who declined to comment when contacted by phone, the WSJ reported.

Additionally, Hong Won-pyo, the president and head of Samsung's Media Solution Center, which has been creating applications and services for Samsung devices, was named president and head of the company's global marketing strategy office.

The Media Solutions Center employs more than 1,000 people, and it's unclear how the change will affect the organization. Samsung said the company is reviewing ways to improve the MSC without dismantling it, the Journal said.

Samsung said earlier this month that it will cut the number of smartphone models it offers in 2015 at least 25 percent and as much as a third in a bid to slash costs and boost profits.

Samsung achieved operating-profit margins for its mobile unit of above 15 percent for 10 consecutive quarters, but in the third quarter Samsung's margins from its mobile and information-technology businesses fell to 7 percent, their lowest since 2008, before the launch of the first Galaxy S smartphone.

Meanwhile, Samsung will release a new sub-$100 smartphone running the open-source Tizen operating system in India later this month, South Korea's Maeil Business Newspaper reported. The newspaper said Samsung will unveil the phone, the Z1, on Dec. 10. Samsung declined to comment, according to Reuters.

Samsung had planned to unveil the Tizen phone in Russia in the third quarter but canceled those plans and put a launch on hold indefinitely. The company said it would work to develop the Tizen app ecosystem. Samsung has several smart watches running Tizen, but no other company has produced a commercial Tizen-based phone.

For more:
- see this WSJ article (sub. req.)
- see this Bloomberg article
- see this Reuters article
- see this separate Reuters article

Related Articles:
Report: Samsung may remove J.K. Shin as head of mobile unit
Samsung to slash number of new smartphone models by as much as a third in 2015
Samsung pushes further into smart home, digital healthcare and virtual reality at developer conference
Why Samsung and Apple should be worried about Xiaomi and Lenovo
Samsung's mobile profit plunges 74% in Q3 as competition intensifies

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