Samsung Said to Plan Galaxy Phone Using Three-Sided Display

Photographer: SeongJoon Cho/Bloomberg
A Samsung Electronics Co. Galaxy advertisement stands illuminated at dusk in Gwanghwamun Square in Seoul, South Korea, on Tuesday, Oct. 22, 2013.

Samsung Electronics Co. (005930) plans to release a Galaxy smartphone next year with a three-sided display that wraps around the edges so messages can be read from an angle, two people familiar with the plans said yesterday.

The phone will use an upgraded version of Samsung’s technology called Youm, currently featured in the curved Galaxy Round handset, the people said, asking not to be identified because the plans haven’t been released. The display may be used in the S or Note series of premium handsets or may be the first in a new line, the people said. Samsung plans to have each side of the display operate independently.

The world’s largest maker of handsets is fighting with Apple Inc. (AAPL) to introduce innovative devices as they brace for a slowdown in the high-end smartphone segment, where Samsung sells about one of every three devices. Apple is developing new iPhone designs including bigger screens with curved glass and enhanced sensors that can detect different levels of pressure, a person familiar with the plans said Nov. 10.

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“We’ll see curved displays coming into the market, but it’s just a question of whether they will gain any significant traction with customers,” said Van Baker, director of research at Gartner Inc.

Samsung climbed 2.7 percent, the most in more than two months, to close at 1,462,000 won in Seoul trading today. That pared the stock’s loss this year to 3.9 percent.

Smartphone Saturation

Samsung doesn’t have a specific release date for the new device, the people said, with one person saying the handset is more likely to come out during the second half of next year. The Youm technology was shown at the Consumer Electronics Show in Las Vegas in January. Chenny Kim, a spokeswoman for Suwon, South Korea-based Samsung, declined to comment yesterday.

The company is diversifying its product portfolio by expanding its use of flexible displays, unveiling the Galaxy Gear smartwatch and registering a design patent for eyeglasses that can answer phone calls while the user exercises.

Samsung filed a U.S. trademark application last year for Youm, saying it could be used in televisions, mobile phones, computers, cars and Christmas tree lights.

“Samsung is the dominant player,” Lee Do Hoon, an analyst at CIMB Group Holdings Bhd (CIMB) in Seoul, said by phone yesterday. “That gives it a competitive advantage over Apple in the race to make phones with bendable displays.”

Curved screens may be a technology in search of a problem to solve, said Gartner’s Baker. Samsung may provide a test case because they have shown a willingness to release products into the market to see if they gain favor with customers, he said.

Consumer Tastes

“There are enough companies out there that are very fond of throwing whatever hardware they can out into the market, just to see if anybody will bite,” he said.

Shares of Samsung face their first annual decline in five years as the company becomes more dependent on smartphones amid mounting worries over slower growth and intensifying market competition. The company, which holds $39 billion in net cash, said it will pursue more acquisitions as it seeks to grow amid fears its core businesses are nearing saturation.

Samsung also is waging a global legal battle with Apple over patents used in mobile devices. The companies have spent hundreds of millions of dollars in legal fees on claims of copying each other’s features.

Apple, which initiated the legal fight in 2011, seeks to limit the Galaxy maker’s growing share of the U.S. market, where the Cupertino, California-based iPhone maker is No. 1 and Samsung No. 2.

Battling Apple

Even with slowing sales of the Galaxy S4 released in April, Samsung last month posted record third-quarter earnings after extending its lead in the smartphone market and benefiting from a rally in chip prices. The company is the world’s largest maker of memory chips.

The mobile unit, responsible for more than 60 percent of profit, posted record operating profit of 6.7 trillion won in the third quarter as the company tapped demand in emerging markets, including China and India. It sold about 120 million handsets in the third quarter for a 28.7 percent market share, researcher Strategy Analytics said Oct. 29.

To contact the reporter on this story: Jungah Lee in Seoul at jlee1361@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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