Samsung chairman Lee Kun-hee who died on Sunday at age 78 laid the foundation for Samsung Electronics to become the world’s top memory semiconductor in the world.
On December, 194, when he was a director at Tongyang Broadcasting, then a subsidiary of Samsung group, he invested his personal funds to own a 50% stake in Korea Semiconductor founded by Dr. Kang Ki-dong.
Lee would acquire the remaining 40% stake of the company on December 30, 1977. The company changed its name to Samsung Semiconductor on March 2. This is how Samsung’s semiconductor business started.
It was South Korea’s first producer of microchips. The company faced difficulties in the beginning from lack of funds and technologies. It was acquired by Samsung Electronics on January, 1980.
Samsung acquired Korea Electronics Telecommunication on October, 1982. It merged the company with its semiconductor business to form Samsung Semiconductor Telecommunication. Samsung founder and chairman Lee Byung-chull announced at Tokyo that the company would enter the semiconductor market in earnest.
After Byung-chull passed away, and with Lee Kun-hee now as chairman, Samsung Electronics again merged Samsung Semiconductor Telecommunication on November 1. Samsung still marks November 1 as its “founding year” do to the event’s symbolism.
Samsung begin to produce DRAM, and began producing 1M DRAM cheaper than rival companies in Japan.
The development story of 4M DRAM is a famous company lore. Samsung was mulling weather to apply the stack method or the trench method for 4M DRAM development. Chairman Lee reportedly said “think simply”, saying it was simpler to stack the chips than to dig into them. Stacking was also considered more convenient for repairs.
This led to Samsung offering level quality 4M DRAM to its Japanese rivals. Samsung surpassed them for the first time in 16M DRAM, and succeeded in developing 64M and 256M faster than Japanese rivals.
In 1995, the market for 64M DRAM opened up. Samsung Electronics’ semiconductor division posted 8.13 trillion won in sales, 40% higher than its initial estimate, and operating income of 2.71 trillion won.
But chairman Lee wasn’t satisfied. He reportedly said: “To become the world’s top isn’t easy, but it is not impossible. But once you are at the top, you may lose your goal. This is why staying on Top is more difficult than the road to the top. Being at the top will always be dangerous unless there are bone-crushing efforts behind it.”
Samsung has been the world’s top vendor of DRAM since 1992, according to Data Quest (now Garner). The ranking has not changed since then. Samsung started late in NAND flash compared to Toshiba but eventually became the leader in the sector as well. Samsung’s is the world’s largest memory semiconductor company by revenue, and the world second largest semiconductor company by revenue after Intel today.