UPDATE 2-Samsung plots smartphone catchup to treble sales

* Samsung to treble smartphone volume to over 18 mln units

* Samsung targets over 260-270 mln cellphone sales in 2010

* To boost smartphone line-up and its own Bada platform

* Analysts see Android phones to lead in H1, sceptic on
Bada

(Adds details, comments)

By Rhee So-eui and Miyoung Kim

SEOUL, Feb 4 (BestGrowthStock) – Samsung Electronics Co Ltd, the
world’s No. 2 cellphone maker, aims to treble smartphone
shipments and accelerate a strategy to boost software tools in
a market dominated by Nokia phones, iPhone and Blackberry.

South Korea’s Samsung (005930.KS: ) and its home rival LG
Electronics Inc (066570.KS: ), which together corner more than 30
percent of the global cellphone market, face a major challenge
to muscle into the fast-growing smartphone market.

On Thursday, Samsung raised the stakes as it carve out a
plan to aggressively promote phones based on its own,
little-known Bada platform, as well as offer phones running on
Google’s (GOOG.O: ) Android, Microsoft’s (MSFT.O: ) Windows Mobile
and LiMo’s Linux.

“There’ll be a big change in our smartphone strategy this
year,” Shin Jong-kyun, head of Samsung’s mobile division told
reporters.

“We plan to strengthen our smartphone business this year by
not just improving hardware offerings but also beefing up
content, applications, services.”

Nokia (NOK1V.HE: ) sells more smartphones than any of its
rivals, with 39 percent market share. Apple and RIM control 14
percent and 20 percent respectively of a market estimated at
174 million units last year, according to research firm
StrategyAnalytics.

Samsung has only about 3 percent and sold around 6 million
smartphones last year under such brand names as Omnia and
Galaxy.

It aims to treble shipments this year to more than 18
million phones, helping it raise overall selling prices of its
cellphone portfolio.

In the broader handset market, Samsung, which sold 227
million mobile phones last year, said it aimed to grow faster
than the broader market by selling 260-270 million this year.

Smartphones, with advanced mobile Internet and networking
functions, have been the one bright spot in an otherwise
depressed handset market last year and are set to become the
fastest-growing sub-segment in the overall handset sector this
year.

SCEPTICAL ON BADA

Samsung unveiled an Android-based smartphone on Thursday,
which will go on sale in the domestic market in late February
or early March. It also said a Bada-based phone will debut in
late March or April.

Android is generally viewed as a more viable and
competitive mobile operating system to fight against Apple’s
(AAPL.O: ) iPhone, the industry’s top profit generator, as it has
the potential to create a large application store, thanks to
Google’s brand, advertisements and investment.

Shipments of Bada-based products are set to increase
sharply but the company did not give a detailed break-down.

Samsung’s own platform will not become a system that other
manufacturers will want to adapt, said Oh In-bum, an analyst at
Dongbu Securities.

“It will be more like a platform that works like the
operating system in feature-centric phones. Samsung will try
different operating systems from Android to its own and drop
whatever won’t work,” Oh said.

Analysts expect Samsung’s smartphone lineup to focus on
Android phones in the first half.

Applications are becoming a key element for companies as
more and more consumers base their purchases on the
availability and variety of software offered.

Its strategic change comes as Choi Gee-sung took over as
Samsung’s new chief executive in December, after a successful
carrier in building the company’s strong mobile phone
marketing.

Nokia cut phone prices across its portfolio in late January
and launched free satellite navigation to boost smartphone
sales, putting its cheapest smartphones on a collision course
with mid-ranged phones from rivals Samsung and Sony Ericsson.
[ID:nLDE60Q18A]

For a FACTBOX on global smartphone makers, [ID:nTOE61208O]

Shares in Samsung were flat in a steady broader market
(.KSII: ).

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(Editing by Jonathan Thatcher and Anshuman Daga)

UPDATE 2-Samsung plots smartphone catchup to treble sales