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Samsung smartphone falling into innovation trap

November 7, 2013

By Kim Hye-sung

Samsung Electronics Vice Chairman Lee Jae-yong

Samsung Electronics Vice Chairman Lee Jae-yong

“Samsung smartphones are in an innovation trap,” said Samsung Electronics Vice Chairman Lee Jae-yong.

When asked “What is Samsung Electronics next growth engine?” in an interview, Lee said that “It is a problem we are working on.”

“Apple and Samsung have raised consumers’ expectations, but we haven’t found the ‘idea’ that can move us to the next step yet.”

With regard to the fierce competition with Apple, the vice chairman said, “There’s no need to worry too much about it. Apple isn’t strong enough to beat us and vice versa.”

“Galaxy S4 has reported strong sales, but both Apple and Samsung haven’t been able to show consumers something jaw-dropping. We are both in an innovation trap,” Lee said.

Samsung Electronics has posted a 16 percent compound annual growth for the past three years. The IM (IT and Mobile Communications) division was responsible for 60 percent of the total sales, and 70 percent of the company’s operating profit.