What: Samsung has announced plans to invest $22 billion in artificial intelligence, automotive technology, and 5G development.
Why it matters: Innovations powered by AI technology will drive the industry’s transformation and the next-generation 5G telecommunications technology will create opportunities in autonomous vehicles, the IoT and robotics.
The Samsung conglomerate said in a statement it will invest more than US $22 billion over the next three years to target four new technology areas: artificial intelligence, auto-technology components, 5G, and biopharmaceuticals. The tech company said it will hire 1,000 AI researchers around the world and seek to become a major player in next-generation 5G networks. It said both technologies are crucial for the development of autonomous vehicles.
Even though Samsung is South Korea’s biggest conglomerate and the world’s biggest smartphone maker, its profits have suffered from disappointing sales and slowing demand for some memory chips, which is why the company is going after growth drivers beyond smartphones. Moreover, it is facing increasing competition from Chinese rivals Huawei and Xiaomi.
Samsung also announced a series of initiatives aimed at building the ecosystem of innovative businesses for the digital economy. Samsung plans to open its venture incubation program to both external and internal startup projects and provide software training.
“Samsung aims to become a leader in electronics components for future cars such as system-on-chips for autonomous driving, utilizing its leadership in semiconductors, telecommunications, and display technologies,” stated the Samsung investment announcement.
The investment includes capital expenditures and research and development. Samsung is expected to create 40,000 new jobs over the next three years. The company also will expand C-Lab, its internal venture incubation program, and work with the Korean government to establish and run software education centers across the country.
These investments are part of a larger plan to spend US $160 billion over the next three years on capital expenditures and research and development. Areas that will be targeted for investment include the company’s manufacturing hubs, as well as existing memory and display businesses.