Samsung Strategy

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Title: Samsung Strategy

Essay Details:

Subject: Technology

Author: Freda R

Date: February 21, 2014

Level: University

Grade: A

Length: 3 / 806

Essay text:

Although the industry growth is at 16% per year, low product differentiation (almost as commodities) and low switch costs for the buyers force the competitors to compete on prices. Chinese Entrant Strategy The large-scale entry by the Chinese firms in 2005 adds to this competitive pressure within the DRAM industry. The Chinese firms adopt Samsung’s strategy from 20 years ago by competing in prices of the older product lines; they are willing to sacrifice profits for market share. To overcome the high capital investment barrier to entry, the Chinese firms attract billions of dollars from foreign investors and the Chinese government to build state-of-the-art facilities; in addition, they form partnerships with and obtain licenses from industry incumbents like Infineon and Elpida to learn the necessary expertise in design and production process that are one or two generations old...

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