Samsung Electronics (005930.KS) has carried out a one-point ad hoc reshuffle, abruptly replacing the head of its Visual Display (VD) Division. The move reflects a sense of urgency that "there is no time to wait for business restructuring" amid a rapidly changing market environment marked by fierce competition from Chinese rivals and the spread of artificial intelligence (AI). Analysts say the company has brought in a service expert with a Google background as a relief pitcher to fundamentally overhaul the TV business from its hardware-centered revenue structure to a platform- and service-centered one.
Samsung Electronics announced Sunday that it has appointed Lee Won-jin, president and head of the Global Marketing Office, as the new head of the VD Division under the Device Experience (DX) Division and concurrent head of the Service Business Team. Yong Seok-woo, the previous VD Division head and also a president, has been reassigned as an adviser to the head of the DX Division.
It is highly unusual for Samsung Electronics to carry out an ad hoc reshuffle in May rather than as part of its regular year-end personnel changes. The presidential-level replacement was led by Roh Tae-moon, president and head of Samsung Electronics' DX Division, and was reported to and approved by Samsung Electronics Chairman Lee Jae-yong. The move is seen as signaling the full-fledged rollout of Chairman Lee's pragmatic stance of carrying out ad hoc personnel changes at any time of the year for underperforming businesses or organizations in need of renewal. With competition in the TV market intensifying to an extreme level amid the pursuit by Chinese rivals, the decision is viewed as reflecting a sense of desperation that the business could be left behind unless its structural limitations are addressed immediately.
An executive in charge of marketing and services moving directly to head a finished-product (set) business division is considered an exceptional and bold appointment even within Samsung. Lee, who joined Samsung Electronics in 2014 after working at Google, has been a key figure leading service businesses in the mobile and TV divisions. He is particularly credited with successfully establishing "Samsung TV Plus," a free ad-supported streaming service, transforming what had been a business focused solely on selling devices into a platform service business generating channel revenue.
The industry views the sober internal judgment — that hardware sales alone can no longer guarantee the profitability of the past in the AI era — as the key backdrop for this appointment. With rival LG Electronics generating solid profits through its proprietary smart TV platform webOS, a consensus has formed that Samsung Electronics must also significantly strengthen the competitiveness of its platform ecosystem.
The management's strong trust in Lee is also cited as a major factor behind his selection. Lee maintains a close relationship with Kim Jae-youl, president of Samsung Global Research and husband of Samsung C&T President Lee Seo-hyun, exchanging business ideas with him on informal terms. Chairman Lee is also said to have highly valued Lee's "business turnaround" capabilities in creating a stable profit-generating model through TV Plus platform advertising. Last year, Lee drew attention from the business community by appearing at the Sun Valley Conference, an event previously attended by Chairman Lee.
"President Lee Won-jin will further strengthen the competitiveness of the TV business from a fresh perspective, based on his rich experience of business success and understanding of the market," a Samsung Electronics official said.
Meanwhile, Yong, who has stepped down to serve as an adviser to the head of the DX Division, will take on an advisory role on future core technologies across the set business, including AI and robotics, drawing on his research and development (R&D) expertise and business experience.
