The World’s Largest Smartphone Maker Since 2011 Started Off as a Grocery Store!!

Samsung recently launched the Galaxy S24 Series, its first AI-enabled flagship smartphone powered by Google’s Gemini large language model.

You would be surprised to know that Samsung was opened in March 1938 as a grocery store in Korea by Lee Byung-Chull. The store used to import and export dried fish, vegetables and noodles.

Following the Korean War in the early 1950s, Byung-Chull expanded the grocery trading business into textiles, opening the largest woollen mill in Korea. At the time, Korea was one of the poorest countries in the world and Byung-Chull helped redevelop his nation’s economy by focusing heavily on industrialisation.

During this fraught financial period for the country, the South Korean government supported large domestic companies. The practice, known as the chaebol, nurtured firms with easy financing and protected them from competition. Samsung was among those supported by the chaebol since the early 1960s, securing a string of loans and other business support.

However, it wasn’t until 1969 that Samsung entered the electronics industry, opening electronic-focused divisions within the company. One of its first electronic goods were black and white televisions, which it first began exporting to Panama in 1971. By the mid-1970s, Samsung made washing machines, fridges, and mass-producing colour TVs.

Not wanting to be left behind in other burgeoning industries, the 1970s also saw Samsung open subsidiaries including Samsung Shipbuilding, Samsung Heavy Industries and Samsung Precision Company. Samsung also started to invest in the chemical and petrochemical industries.

In 1974, Samsung Electronics acquired Hankook Semiconductor, a move which saw the company become the market leader in memory chips in the early 1990s and retain its position as the world’s leading manufacturer of semiconductors. Today, even most Apple iPhones, the arch-rival of Samsung’s Galaxy phones, use Samsung memory chips.

The next few years saw Samsung discarding its low-quality manufacturing practices, and truly emerge as a pioneer in electronics.

Fast forward to 1998, Samsung created the world’s first digital TV. In 1999, it launched the world’s first MP3 mobile phone. While Nokia dominated the mobile phone market during the 1990s, Samsung continued to make innovations to handsets. By 2002, Samsung’s SGH T100, the first mobile phone to use a thin-film transistor active matrix LCD display, was one of the best-selling phones, selling 12 million handsets worldwide.

The 2000s saw Samsung develop new technologies for the TV industry, designed to improve viewing experiences for customers. In 2007 Samsung enjoyed global sales surpassing $100 billion (£78.3bn) and by the end of 2008 it was the world’s number-one TV producer.

That same year (2008), after being found guilty of tax evasion and embezzlement, according to Reuters, Kun-Hee (pictured centre) resigned from Samsung. Kun-Hee was let off lightly, receiving a suspended three-year sentence and fined just $100 million (£78.3m) – relative chickenfeed for a man of his wealth.

However, Samsung’s dominance as a global electronics powerhouse continued. In 2009 Samsung released its first Android-powered device – a smartphone known as the Samsung Galaxy i7500 (pictured). The phone was not without its faults, with original Galaxy users criticising Samsung for the phone’s lack of firmware updates. Its first Android smartphone to enjoy mainstream commercial success was the Galaxy S, which was launched just nine months after the original Galaxy. The phone went on to sell more than 25 million units.

Adding a dramatic twist to the tale, Kun-Hee was pardoned by South Korea’s president Lee Myung-bak. Having received a special amnesty, Samsung’s former chairman returned to helm the company after a two-year absence. His return came after Samsung made record sales in 2009.

Kun-Hee’s pardon is believed to have been made to allow the billionaire business tycoon, who is a member of the International Olympic Committee, to boost South Korea’s efforts to host the Winter Olympics. It might have worked because, in 2011, it was announced South Korea would host the 2018 Winter Olympics.

As Galaxy smartphones started to sell like hotcakes and the company’s disgraced chairman returned to the helm, a book named “Think Samsung” was published in 2010, written by Samsung’s former chief legal counsel Kim Yong-chul. The book made sensational claims about Kun-Hee’s corruption, claiming he stole around $10 billion (£7.8bn) from Samsung subsidiaries, bribed government officials and destroyed evidence. Despite the allegations reported in the book, most of South Korea’s mainstream media refused to run the scandal, seeing an attack on Samsung as an attack on South Korea itself.

In spring 2011 Apple began to litigate against Samsung in patent infringement suits around the design of Samsung’s smartphones. By October, the two tech giants were embroiled in 19 ongoing cases in 10 countries. The protracted legal disputes between Samsung and Apple were eventually put to bed. In 2012 a US court ruled that Samsung had infringed copyright of the design of Apple’s iPhone, and Apple was awarded $548.2 million (£426m) three years later. However, in a fresh twist in 2016, the supreme court sided with Samsung, who had been seeking to pare back $399 million (£310.4m) of its previous debt, as reported by The Guardian.

Despite the damning copyright infringement ruling, in 2013 Samsung was named as the world’s largest tech company by the annual Fortune 500 list, which ranks the world’s largest corporations by revenue. Samsung was placed five notches above rival Apple, reporting revenues of $178.6 billion (£140bn) and profits of $20.6 billion (£16bn).

Samsung’s tribulations continued in 2017 when vice chairman and heir to the Samsung empire Lee Jae-yong was found guilty of bribery and cronyism, as reported by the BBC. He was sentenced to five years in jail in August of that year, despite denying the charges. However, six months later in February 2018, Jae-yong’s sentence was halved and the rest of the jail term suspended by Seoul High Court, and he walked free.

Despite being laden with controversy, scandal and setbacks along the years, Samsung has been the world’s largest manufacturer of mobile phones and smartphones since 2011 and has a market cap of $370 billion in 2023 – not at all bad for a one-man dried fish-selling start-up.

Team Profile

Shubham ChakrabortyNews Writer

Shubham Chakraborty, a Freelance Writer, holds an MBA from XLRI and boasts 6.5 years of extensive corporate experience. Departing from his corporate path, he embarked on a journey to fulfill his childhood dream of focusing on writing.

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