Samsung Galaxy S10: South Korea does not consider itself any less a technology powerhouse than China. While China may beat it in terms of the volumes, Samsung Electronics from South Korea is one shining example of the technological capabilities of the Korean companies to manufacture world-class electronic goods. But the cost of manufacture and decline in profitability has led the Korean major to turn to China for some components. In the case of the Samsung Galaxy S10, for example, Samsung plans to order the antenna component from a Chinese source.
The 3-Combo Antenna for Mobile Phones
Some of the top-end smartphones have 3 different functions for antennas. These are the Magnetic Secure Transmission (MST), Near Field Communication (NFC) and the third Wireless Power Consortium. The last type of antenna is meant for the phones with the wireless charging functionality and the second one, NFC helps with payment through short-range devices. Samsung uses a single antenna for executing all three functions above and this is known as the 3-combo antenna in the trade circles for its flagship phones in both the Galaxy S series phones like the S10 to be released next year as well as the Note series phones. Where the wireless charging facility is not provided, then the WPC antenna becomes redundant and there a 2-combo antenna is used.
Samsung Has Vendors in Korea
This development of Samsung choosing a Chinese vendor for the antenna for its Samsung Galaxy S10 smartphone has come as a surprise since there are two sources from where the company has been sourcing its antennas and possibly will continue to do so. One is an in-house venture Samsung Electro-Mechanics and the other Amotech. Both are capable of supplying the 3-combo antenna. Then why should Samsung go to China?
Cost-Reduction at the Center of the Decision
According to people in the know, the top companies in the smartphone business are confronted with a drop in sales growth and therefore overall profitability. When phones are being sold at $800 to $1000, the buyers don’t change their devices every year. The average life-cycle of ownership of devices in the hands of the customers has increased. This has left with a lesser number of people going for replacement of their mobile phones. There will always be the first-time buyers of high-end phones; but in the end, what matters is how many phones get sold in the market. All these factors have turned the focus on the cost of making a phone and finding ways to bring it down. This is possibly the only reason, Samsung decided it will save a few dollars here by ordering the 3-combo antenna from China. The only aspect to be taken care of is the quality of the components procured from China. The sense is the quality has improved a lot and it is now as good as one would want it while keeping the cost low.
Some Korean companies may feel the impact for some time. So be it.