On Thursday, June 16, Samsung Electronics Co. has announced its interest in buying the U.S. cloud services company Joyent Inc. The amount of the transaction has not been disclosed.
According to the Wall Street Journal, Samsung is looking to acquire the U.S. cloud services company in order to expand its core mobile phone business with new apps and services. Injong Rhee, chief technology officer of Samsung's mobile division, told the publication that the company intends to shift its focus more on services and software after it has been traditionally focused on hardware.
Rhee said that today cloud-based computing are handling applications in areas like artificial intelligence and virtual reality. Despite smartphones integrate ever more sophisticated and powerful chips, handsets are becoming simply "interface devices."
The world's biggest smartphone maker is not intending to compete with Microsoft Azure, Google Cloud or Amazon Web Services. Samsung is, in fact, planning to use cloud computing in order to drive innovations in its smartphone software, particularly around virtual reality and artificial intelligence applications.
According to International Business Times, the 11-year-old, San Francisco-based Joyent will continue its main operations as normal after the acquisition by Samsung. Joyent is currently selling access to private and public cloud computing services.
Samsung will leverage Joyent's expertise in order to improve the services and software offered to its smartphone customers. The U.S. cloud computing firm will continue to operate independently. Samsung will effectively become Joyent's biggest customer in order to remove its current dependence on Microsoft's and Amazon's cloud services.
Thanks to the launch of the Gear VR headset and the partnership with the Facebook-owned Oculus VR, Samsung is the leader in the mobile virtual reality market. The company aims to capitalize on this lead in order to increase flagging smartphone sales. By offering more immersive and graphically impressive experience, Samsung hopes to attract more customers.
With Joyent, Samsung is already at its third acquisition of a U.S. startup. The company previously acquired LoopPay and SmartThings. Samsung Pay services are now based on LoopPay payment technology. The connected home offering of the South Korean company is based on smart home technology developed by SmartThings.