Samsung has invested $112 million in Japanese tech firm Sharp for a 3 percent share of the company. Sharp, along with other Japanese tech companies such as NEC, has fallen behind in the race for relevance in the global marketplace, and has only recently begun the long trek to claw its way back. The deal is expected to go through on March 28, with Samsung buying nearly 36 million shares for around $3.11 each.
Japan had long suffered a "Galápagos syndrome" of technology, with advanced feature phones that could browse the Internet and access email long before smartphones were even a glimmer of an idea, but it had diverged so much from any other market, running on its own networks, that Japanese cellphone makers had little desire or incentive to establish themselves elsewhere.
This turned out to be a mistake: because of their hesitance to adapt globally, Japanese cellphone makers have lost more than half the nation's market share to foreign brands such as LG, Samsung and Apple. Japan is no longer considered a Galápagos Island, but its domestic technology has not matched the pace of the competitive global market.
Sharp supplies LCD screens to both Apple and Samsung, but this move signals the firm's intention to be less dependent on Apple, as well as a self-proclaimed effort in the "recovery of business performance and credibility." This benefits Samsung as much as it does Sharp: Samsung will secure a reliable source of LCD panels for TV sets, laptops and smartphones while other smartphone makers, such as Nokia, struggle to shore up enough supply to even produce its flagship Lumia 920.
Former rivals, Samsung's push to ally itself with Sharp is right in line with the Korean giant's efforts to drive itself further ahead of Apple and dominate the mobile market. Google, which has very good reason to be wary of Samsung (40 percent of all devices running Android are Samsung-branded), even bought Motorola as insurance to produce its own hardware.
Sharp's ailing health was also bolstered somewhat last year when Qualcomm announced a $120 million investment deal and Hon Hai, Foxconn's parent company, is also reportedly in deals to take a 10 percent share, reports the Wall Street Journal.
