Is Samsung the Next BlackBerry?

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Samsung and BlackBerry (NASDAQ: BBRY  ) don't have a whole lot in common beyond the fact that both companies compete in the cutthroat smartphone market. However, following Samsung's Galaxy S4 unveiling, the South Korean conglomerate now bears a resemblance to a part of BlackBerry's history that it would probably rather forget.

Shortly after the debut, Samsung announced that it's appointing two new CEOs. That's right, two. That's in addition to the existing CEO. Samsung now has a total of three CEOs: Oh-Hyun Kwon, Boo-keun Yoon, and J.K. Shin. Kwon was the existing CEO and will continue to serve as chairman of the board as well.

Yoon has been head of the TV business and is noted as solidifying Samsung's position in the TV market. Shin has been in charge of Samsung's mobile business, which is now one of the biggest generators of Samsung's operating income thanks to the popularity of its Galaxy line of smartphones. Both new co-CEOs will continue leading those respective businesses, but the new structure is intended to "clarify and enhance" management.

Of course, BlackBerry had a pair of co-CEOs and co-chairmen for years: Jim Balsillie and Mike Lazaridis. This arrangement was widely considered a corporate-governance travesty. Generally speaking, corporate-governance advocates always recommend against having the same executive serve as both chairman and CEO. In its Research In Motion days, BlackBerry had two executives filling both roles.

Having two individuals serve in two highly important capacities probably contributed to BlackBerry's strategic paralysis in the face of dramatically intensifying competition. Rivals rose to prominence as BlackBerry stagnated, and it didn't help that management lacked clear direction, potentially because Balsillie and Lazaridis had to consult each other on just about everything. It wouldn't be until January 2012 that the company would name Thorsten Heins as a single new CEO, after years upon years of investor criticism.

This is potentially a risk that Samsung will now face, if having three CEOs leads to indecision in key strategic areas. One big difference is that Samsung is one of the largest electronics conglomerates known to man, with countless operating divisions. An organization of that size may have room for everyone, while BlackBerry's singular smartphone business suffered from the co-CEO/co-chairman structure.

Sometimes, three heads may not be better than one.

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Read/Post Comments (11) | Recommend This Article (4)

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  • Report this Comment On March 16, 2013, at 8:05 PM, seamonkey2002 wrote:

    "Is Samsung the Next Blackberry?" - It is...and Blackberry, given 18 months, will become the next Samsung. The Ass4 is pure garbage. Knox is a joke. The kids have grown up and Blackberry is once again the device to have. QNX technology will seamlessly tie together mobile devices with automobiles.

    Funny how the tables have now turned...

  • Report this Comment On March 16, 2013, at 8:09 PM, marv08 wrote:

    "Having two individuals serve in two highly important capacities probably contributed to BlackBerry's strategic paralysis in the face of dramatically intensifying competition."

    Certainly possible. But there were certainly enough companies that followed corporate governance ideals (Nokia, Palm, HP come to mind) and did fail even worse.

    Overall, boards are filled with too many "take the cheque and nod to everything" characters, normally not even understanding the business. They either say "yes" to everything until it is too late (see Nokia), or they only come out of their holes, to perform nonsensical publicity stunts (like HP's ousting of Mark Hurd, one of the best CEOs in tech ever, for nothing); during the lunatic and over-priced acquisitions of EDS, Palm and Autonomy, they did zip. Corporate governance is a nice idea, it doesn't do much in terms of guaranteeing good decisions.

  • Report this Comment On March 16, 2013, at 9:29 PM, ajac09 wrote:

    LOL blackberry will never regain its share. its sale are NOTHING compared to samsung in the same period and it will continue to fall down. Anyone that thinks other wise lives in a dream world. Blackberry is dead. Get over it.

  • Report this Comment On March 16, 2013, at 9:48 PM, cbglobal wrote:

    Dual governance does not work? Warren Buffett and Charlie Munger certainly did OK.

  • Report this Comment On March 16, 2013, at 9:56 PM, cbglobal wrote:

    I am confused ajac09. Back when Blackberry was dominant they sold about 8 million phones per year and had a grand total of 8 million subscribers. Now they have 80 million subscribers and in the last year just ended before the new phones came out they sold 30 million Blackberrys.

    How do you not re-gain less than what you have now?

  • Report this Comment On March 16, 2013, at 10:41 PM, cbglobal wrote:

    Other dual governance.

    Eastman & Kodak

    Sear & Roebuck

    Hewlett & Packard

    List too long to bother. You get the idea.

  • Report this Comment On March 16, 2013, at 11:11 PM, samdungnogood wrote:

    samdung should make a pop out fridge to use at parties to keep the beer cool. If it wasn't for google samdung would have no phone... Samdung really knows how to pirate off of everyone else

  • Report this Comment On March 16, 2013, at 11:38 PM, ajac09 wrote:

    blackberry is NOT dominate not even close.They own 1% of the market and have gained NOTHING. Carriers are already cutting the price becasue the new shipments that came are NOT selling. They initially sold out becasue they didnt have many to sell in the first place. It is I repeat NOT selling as well as they say. The biggest sell of them so far has been to there own company for there employees. Android and IOS will continue to murder blackberry,

  • Report this Comment On March 17, 2013, at 12:51 AM, TimKnows wrote:

    The real worry is Apple, they could use a leader, they make junk, can't find anything to do with cash and their OS is from 2007. Be very worried about Apple.

  • Report this Comment On March 17, 2013, at 5:33 PM, urngoodhands wrote:

    The question should be "is APPLE the next Blackberry"

    Apple has failed to innovate, ala Blackberry.

    Samsung hasn't. And they have market share. And they have hit the price-point sweet spot.

    Get real people....

  • Report this Comment On March 18, 2013, at 12:00 PM, hyukki wrote:

    I'd worry about Apple before I worry about Samsung.

    Apple made several mistakes. In the past several years, Apple tried to copy Samsung's moile technoligy w/o truly understanding the mobile phone market. Jobs must have thought he can copy Samsung and slap "Made in U.S." and sue them and that is it. Quite frankly Jobs couldn't even handle Samsung. Samsung is just too big, too smart for Apple to handle. Korea is #1 in IT techology and its usage. Both Korea and Japan are so-advanced in the usage of IT products such as phones that it is mind-boggling sometimes.

    You say iWatch? Or iTV? Lol. If Apple gets into these products, they will not be able to compete!

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