Samsung Acquires NewNet Communications to Accelerate a Next-Gen Messaging Experience for Galaxy Smartphones
On Monday Patently Apple posted a report titled "Samsung Aggressively Gets into Apple's Face with Moves into AI and Telematics with Harman Acquisition." Samsung's heir apparent Lee Jae-yong officially joined the company's board in late October. The Korea Times reported last month that that the Samsung board of directors determined that they couldn't postpone Vice Chairman Lee's appointment as board director and his official participation in business management in order to deal with rapid changes in the business environment and achieve sustainable growth. One of Lee's first duties was to officially apologize to the American public for their disastrous Note7 smartphone and top-loading washers that had to be discontinued and recalled due to fires and explosions. Then Lee went into action and acquired Viv to take on Apple's Siri as early as February with the introduction of the Galaxy S8. Then on Monday Samsung acquired Harman to get ahead of Apple on Telematics covering in-vehicle navigation, infotainment and right through to autonomous driving features for automobiles. Late yesterday Samsung announced yet another potentially strategic move to improve their smartphones going forward.
Yesterday Samsung announced that they've acquired Canadian company NewNet Communication Technologies. The new technology will be used in future smartphone and connected car businesses.
Through the deal, users of Samsung smartphones will likely get a standards-based messaging and communications platform. Samsung noted in their press release that "Consumers will benefit from an advanced messaging experience with features such as enhanced calling, group chat, and the ability to easily share and transfer large files including multimedia and high-resolution photos. Unlike other messaging apps in the market, users will be able to communicate on any network, with an RCS-enabled device as well as SMS-only devices."
NewNet's press release added that "The acquisition reinforces Samsung's commitment to RCS as mobile networks transition to IP-based networks and services.
This acquisition is a critical milestone not just for Samsung but also for the communications industry. As an end-to-end GSMA-compliant RCS solution, it will accelerate the deployment of RCS-enabled networks, providing consumers with a ubiquitous standards-based messaging and communications platform. The acquisition will also enable Samsung to offer interoperable server solutions for mobile operators that do not already have their own RCS infrastructure. By driving significant value for operators and consumers, the mobile communications market can benefit from the broader communications ecosystem.
Samsung Electronics bought a 100% stake in the company from Skyview Capital. Terms of the deal were not disclosed.
While Samsung will continue to pursue hardware advantages over Apple, the new shift to focusing on software is the one to keep an eye on going forward. Lee's agenda is to clearly provide the company with new growth opportunities that will naturally provide them with a badly needed new foundation that will allow them to better battle Apple and more aggressive competitors quickly rising in the market such as Huawei.
Huawei is a Chinese multinational networking and telecommunications equipment and services company headquartered in Shenzhen, Guangdong. It is the largest telecommunications equipment manufacturer in the world, having overtaken Ericsson in 2012; the same Ericsson that sued Apple and forced a patent licensing deal in 2015. Huawei is entering the U.S. market in January 2017 and that is bad news for Samsung.
At the end of the day, Samsung's latest acquisition of NewNet Communications is a strategic move to help them beef up their communications software that will help them catapult Viv in their 2017 premium smartphone lines.
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