Samsung seeks deals to expand software reach

Samsung Electronics Chairman Lee Kun-hee is pushing top Samsung executives to explore how the company can boost its software prowess, possibly through an acquisition, in the wake of Google's (NASDAQ:GOOG) proposed $12.5 billion acquisition of Motorola Mobility (NYSE:MMI), according to South Korean media reports. 

The reports are one of the first indications that an Android licensee is taking steps to mitigate the potential fallout of the deal. "Chairman Lee told top managers to come up with various measures including M&As to enhance software competitiveness," Kim Soon-taek, head of the Samsung Group office, told local reporters, according to Reuters.

Additionally, according to a report in the Korea Herald, Lee called a meeting Wednesday with top company executives and told them to focus their efforts to develop the company's software competitiveness.

"(The company) must strengthen the competitiveness of its information technology, secure more human resources and also more actively seek mergers and acquisitions," Lee said, according to a report from South Korea's Yonhap News Agency. "We must pay attention to the fact that IT power is moving away from hardware companies such as Samsung to software companies."

Samsung said it could not confirm Lee's comments.

Samsung produced a statement supportive of Google's proposed deal with Motorola, but the reports make clear that Samsung is worried that it will fall behind on the software front. The company, which has developed its own operating system, called bada, relies heavily on Google's Android platform to bolster its smartphone sales. Samsung also sells phones running Microsoft's Microsoft (NASDAQ:MSFT) Windows Phone 7.

Samsung, long known for its hardware prowess, was the second largest smartphone maker in the world in the second quarter after Apple (NASDAQ:AAPL), according to research firm Strategy Analytics. 

For more:
- see this Reuters article
- see this Yonhap News article
- see this Korea Herald article

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