Apparently,
not only Google has a plan for world domination.
Samsung has
bought a 3% stake worth $112 million to stave Sharp which is experiencing
financial difficulties lately.
This move
by Samsung is seen by analysts as adding fuel to the fire in the Samsung-Apple
rivalry. Sharp supplies a third of Apple's display panels while most of
Samsung's display panels are manufactured by affiliate Samsung Display Co.
It is
interesting to note that last year, during the climax of the bitter
Apple-Samsung Patent War, the Cupertino company distanced itself from the South
Korean giant and started ordering parts for its iPads and iPhones from
different suppliers.
With
Samsung now a stakeholder of Sharp, more courtroom battles between Samsung and
Apple can be expected more in the future.
Too, last
year, Sharp accepted a $120 million investment from processor giant Qualcomm in
a deal that cited that the two companies will collaborate in developing new
power-saving screens for mobile phones based on Sharp's proprietary IGZO
(indium gallium zinc oxide) display technology.
Sharp has
seen better days since the company has suffered from the rise of the Japanese
Yen and the shift of consumers from big television displays to more compact
tablets and smartphones. The massive investments placed by Sharps on its
television division failed to pay off. Major operating losses and retrenchment
ensued.
Well,
desperate times call for desperate measures. Accepting the bailout from
Samsung, Reuters reported that Samsung will have "a smooth supply of
large-sized TV panels and help bolster the Japanese company’s chances of
survival."
While the
two Asian companies have done business in the past, this deal is expected to
further cement the business relationship between the two.
Without the
Samsung acquisition, it has been predicted by business analysts that Sharp will
see a painful $4.5 billion loss this year and further lay-offs for employees.
This move
by Samsung will certainly not go unnoticed in Mountain View. Recent reports
indicate that Google is worried about Samsung becoming too powerful and might
renegotiate the Android arrangement of the two giants.