Samsung, the world's largest handset vendor, has acquired the mobile division of CSR, a UK-based chipset maker. CSR's portfolio includes key technologies for mobile device connectivity, such as Bluetooth and WiFi, including the emerging 802.11ac standard. The US$310 million purchase brings two primary benefits to Samsung:
- The vertical integration of components to improve its supply chain, optimize BOM costs, and introduce a point of differentiation. Samsung already makes many of its own components, such as displays, flash memory, and application processors;
- The strengthening of the device vendor's patent portfolio to help with IPR battles. Samsung and rivals like Apple have been in courts around the world over patent infringement issues.
Samsung is strengthening its component assets for Bluetooth, GPS and WiFi, which should eventually strengthen its handset designs. If Samsung has great displays and great chips in-house, then that’s going to be a solid basis for technology differentiation and supply chain control that can give Samsung devices a competitive edge. Of course, in the longer term, Samsung may end up juggling too many component balls at once, and a sprawling components portfolio could potentially become a negative rather than a positive if they don’t keep things under control.