Samsung has had significant pressure on its smartphone business over the past year. It has been challenged by Apple and Chinese smartphone manufacturers on the high- and low-end markets, respectively. The middle-priced market has been disappointing for all participants – even Apple’s iPhone 5C disappointed. As a result, Samsung has had to look for other opportunities in the mobile space. Currently, Samsung Electronics derives almost 60 percent of its operating profit from smartphones, a proportion that is expected to shrink.

While it is currently a top AP and memory manufacturer, manufacturing roughly 30 percent of Apple’s A8 chip production (the chip inside the iPhone 6), Samsung has now decided to invest US$15 billion in a new semiconductor factory to build chips for mobile devices. The plant is expected to open in 2017, and will either produce memory or application processors.