Samsung buys Harman for $8B in deal that could pave way for 'Apple Car' competition

Posted:
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Chief Apple rival Samsung Electronics on Monday announced plans to buy Harman International Industries for $8 billion, in a move that could signal its intention to compete against Apple and Google in smartcar technology.




The acquisition, Samsung's largest-ever overseas, will automatically catapult it into the highest levels of automotive tech suppliers, serving clients like BMW, GM, and Volkswagen, Bloomberg reported. Harman is also known for its audio equipment, under names like Harman Kardon and Bang & Olufsen.

Though Samsung also has a stake in Chinese electric car maker BYD, the company doesn't immediately appear poised to build a self-branded vehicle. It could conceivably use Harman to launch its own "infotainment" platform though, or take steps towards more comprehensive in-car systems.

Apple's own automotive project is believed to be at a crossroads. While the company initially set out to design a complete vehicle, various obstacles have led to job losses and a refocusing of the project on self-driving systems. It's expected to decide late next year whether it wants to resume designing its own car or simply partner with an existing automaker.

Google is typically expected to go the second route, despite having long tested self-driving prototypes. Recently it partnered with Fiat Chrysler to test self-driving Pacifica minivans, though not for any commercial endeavor.
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Comments

  • Reply 1 of 54
    How  do you compete against something that does not exist? 
    perkedelbdkennedy1002calitallest skilbrakken
  • Reply 2 of 54
    Wish Apple would have purchased this instead of Beats.
    LeBart1968mike1anantksundarambaconstangtokyojimutallest skilbrakkenlorin schultz
  • Reply 3 of 54
    spice-boy said:
    How  do you compete against something that does not exist? 

    I would suggest leaving the investing to your broker. Ever thought of looking forward? Plus the article uses the word: "could." This means possibly or a chance of. As in currently not the case but it is obvious where the big tech companies are heading in the automotive industry.
    edited November 2016 h2p
  • Reply 4 of 54
    "Harman is also known for its audio equipment, under names like Harman Kardon and Bang & Olufsen."

    Actually, they have something like 20 audio brands including ones like AKG, Soundcraft and JBL. I don't know what their automotive business is, but I bet their audio side makes up the majority of their yearly sales (and the automobile side is probably also mostly audio as well).
    calibaconstangrandominternetpersonirelandlolliver
  • Reply 5 of 54
    gatorguygatorguy Posts: 19,696member
    "Harman is also known for its audio equipment, under names like Harman Kardon and Bang & Olufsen."

    Actually, they have something like 20 audio brands including ones like AKG, Soundcraft and JBL. I don't know what their automotive business is, but I bet their audio side makes up the majority of their yearly sales (and the automobile side is probably also mostly audio as well).
    Probably not according to the news articles announcing the deal. 65% of their business is car-related. 
  • Reply 6 of 54
    NY1822NY1822 Posts: 561member
    My wish is Apple buys LYV (Live Nation)...they will own the content for concerts across the globe and turn this into a virtual reality add on to apple music...they also own ticketmaster
    patchythepiratecali
  • Reply 7 of 54
    sog35 said:
    NY1822 said:
    My wish is Apple buys LYV (Live Nation)...they will own the content for concerts across the globe and turn this into a virtual reality add on to apple music...they also own ticketmaster
    see, this is the type of stuff I wish Tim Cook would do.

    Apple literally has $200 billion in cash and does nothing with it.  Even if only 1 out of 10 acquisitions is a success that would be a win.

    Instead Cook does nothing and sits on his hands.

    in 2012 the stock was at $100
    4 years latter and we are at $105. Pathetic.  And if you minus the growth in the cash balance the value of Apple is actually DOWN since 2012.
    Be honest. If Tim Cook had a 1/10 successful acquisition rate, you would complain about it just as you are doing now.
    macxpresscaliration alstanthemanirelandwatto_cobralolliver
  • Reply 8 of 54
    Rayz2016Rayz2016 Posts: 4,518member
    Wish Apple would have purchased this instead of Beats.
    Why? Do they have a streaming service too? No? Okay, how about expertise in popular music and a group of people who can strike exclusive deals. No?

    Right.

    As much as you wish otherwise, Beats was a good buy. 
    nolamacguypscooter63caliration alstanthemanwatto_cobralolliver
  • Reply 9 of 54
    Wish Apple would have purchased this instead of Beats.
    what is your irrational, obsession with hating on Beats? what is it about that company, its products, or its customers that upsets you so? it's profitable, leads its market with a massively strong, popular brand, and rakes in cash for Apple. why on earth would any sane business person have an issue with it? because black people?? thats all i can come up with, so please, set me straight -- why was this a bad decision for Apple despite all the obvious gains? what is the rest of the world missing that only you can see up there in Minnesota?

    edited November 2016 calihmmpatchythepiratewatto_cobralolliver
  • Reply 10 of 54
    blastdoorblastdoor Posts: 1,888member
    sog35 said:
    NY1822 said:
    My wish is Apple buys LYV (Live Nation)...they will own the content for concerts across the globe and turn this into a virtual reality add on to apple music...they also own ticketmaster
    see, this is the type of stuff I wish Tim Cook would do.

    Apple literally has $200 billion in cash and does nothing with it.  Even if only 1 out of 10 acquisitions is a success that would be a win.

    Instead Cook does nothing and sits on his hands.

    in 2012 the stock was at $100
    4 years latter and we are at $105. Pathetic.  And if you minus the growth in the cash balance the value of Apple is actually DOWN since 2012.
    I agree that I don't like Apple's inability to productively employ that $200 billion, but I think manic, unfocused acquisitions would be worse than sitting on the cash. 

    With so much cash, Apple has the ability to do some big things that nobody else can do. I think it would be much better to do a big thing that nobody else can do than to do 500 little things that many other people can do. 

    I know a lot of people hate this idea, but if Apple were to do a big acquisition, I'd vote Tesla. Elon Musk has ideas for very big things that actually could employ $200 billion in cash. Tesla's problem is that it's undercapitalized. Apple's problem is a lack of a big idea for inventing it's capital. They're the perfect match. 


    calipalominepatchythepirateration alloquitur
  • Reply 11 of 54
    It would appear that this acquisition is in line with Samsung's conglomerate approach. Neither Car Play nor Android Auto have any meaningful traction yet. But all cars will have some form of smart, touchscreen function that will be a prominent feature going forward.
      
    Probably just a way for Samsung to position themselves to be the biggest vendor of the infotainment center/cluster in a high demand market. After the Note 7 fiasco, they have probably realized diversification is the best path for them going forward. Particularly with the maturing smartphone market  
    lolliver
  • Reply 12 of 54
    Hey sog's back, here we go, its been quiet and boring for far too long. It seems to be escaping most, the actual difficulty of building a car. As much as I loath Mask, he was right that Apple was late to the automotive industry, it's not that Apple can't design and build an electric car it's that if that's what you wanted to do, the car is the last thing to be build. Apple has no infrastructure they fully control as they would absolutely need to, like tesla. Now Apple has to build millions of very complex machines to sell in a markert they have zero relatable or cross applicable experience with, and no sence of what success Will be, spend irrecoverable billions on infrastructure that would need to be maintained regardless of the eventual success or failure of the venture. As nice as an Apple car might be I think the environment just isn't ripe yet, makes it kinda easy too because Tim never really said he was building a car,that was all the rumor mill, now imagine if Apple anouced things at R&D before they were ready for market release they'd be stuck.
    ration al
  • Reply 13 of 54
    mike1mike1 Posts: 1,785member
    "Harman is also known for its audio equipment, under names like Harman Kardon and Bang & Olufsen."

    Actually, they have something like 20 audio brands including ones like AKG, Soundcraft and JBL. I don't know what their automotive business is, but I bet their audio side makes up the majority of their yearly sales (and the automobile side is probably also mostly audio as well).
    Actually, no. The vast majority of Harman's sales comes directly from the OE automotive business. A chunk comes from Pro audio (think stadiums, arenas, touring bands, movie theaters, recording studios and new building construction). The smallest part of the business is the consumer/home audio business.
    baconstang
  • Reply 14 of 54
    blastdoor said:
    sog35 said:
    NY1822 said:
    My wish is Apple buys LYV (Live Nation)...they will own the content for concerts across the globe and turn this into a virtual reality add on to apple music...they also own ticketmaster
    see, this is the type of stuff I wish Tim Cook would do.

    Apple literally has $200 billion in cash and does nothing with it.  Even if only 1 out of 10 acquisitions is a success that would be a win.

    Instead Cook does nothing and sits on his hands.

    in 2012 the stock was at $100
    4 years latter and we are at $105. Pathetic.  And if you minus the growth in the cash balance the value of Apple is actually DOWN since 2012.
    I agree that I don't like Apple's inability to productively employ that $200 billion, but I think manic, unfocused acquisitions would be worse than sitting on the cash. 

    With so much cash, Apple has the ability to do some big things that nobody else can do. I think it would be much better to do a big thing that nobody else can do than to do 500 little things that many other people can do. 

    I know a lot of people hate this idea, but if Apple were to do a big acquisition, I'd vote Tesla. Elon Musk has ideas for very big things that actually could employ $200 billion in cash. Tesla's problem is that it's undercapitalized. Apple's problem is a lack of a big idea for inventing it's capital. They're the perfect match. 


    Your points are good but with a deeper consideration however the most logical and most suitable company for Musk would actually be Google not Apple
  • Reply 15 of 54
    Rayz2016Rayz2016 Posts: 4,518member
    sog35 said:
    blastdoor said:
    sog35 said:
    NY1822 said:
    My wish is Apple buys LYV (Live Nation)...they will own the content for concerts across the globe and turn this into a virtual reality add on to apple music...they also own ticketmaster
    see, this is the type of stuff I wish Tim Cook would do.

    Apple literally has $200 billion in cash and does nothing with it.  Even if only 1 out of 10 acquisitions is a success that would be a win.

    Instead Cook does nothing and sits on his hands.

    in 2012 the stock was at $100
    4 years latter and we are at $105. Pathetic.  And if you minus the growth in the cash balance the value of Apple is actually DOWN since 2012.
    I agree that I don't like Apple's inability to productively employ that $200 billion, but I think manic, unfocused acquisitions would be worse than sitting on the cash. 

    With so much cash, Apple has the ability to do some big things that nobody else can do. I think it would be much better to do a big thing that nobody else can do than to do 500 little things that many other people can do. 

    I know a lot of people hate this idea, but if Apple were to do a big acquisition, I'd vote Tesla. Elon Musk has ideas for very big things that actually could employ $200 billion in cash. Tesla's problem is that it's undercapitalized. Apple's problem is a lack of a big idea for inventing it's capital. They're the perfect match. 


    I never said Apple had to be a maniac in acquiring companies. I am saying they at least should take some risks and put that $ to use.

    Apple could have bought Tesla for half the price just 2 years ago. They missed on so many opportunites its sick.

    Instead they used the cash to do $200 billion in buybacks which has only benefited Wall street day traders. 

    IMO, Tim Cook is way over his head as CEO. Guy is great with supply chain, but he isn't a visionary nor does he know how to grow through acquisition

    If he used 200billion to get shares off the market and away from rank amateurs like Wall Street and you, then its money well spent. 
    ration alirelandlolliver
  • Reply 16 of 54
    Apple lost a huge opportunity. Harman has class, design chops, and is already in the dashboard of every high end auto manufacturer. At this point, we have to reluctantly accept the fact that this plays into the narrative that the company lacks a clear strategy/vision. At least, none that is evident.

    And it's painful to watch the stock getting pounded. Yes, I know that tech is taking a hit, but Apple is getting massacred.
  • Reply 17 of 54
    If my theory on the W1 chip is right (http://q10a1.blogspot.com/2016/11/w1s-killer-app.html), this is potentially unhelpful for Apple. However, given how closely Apple and Samsung work together on other things (notwithstanding their device competition), perhaps it is fine.
  • Reply 18 of 54
    macxpressmacxpress Posts: 4,673member
    sog35 said:
    Apple lost a huge opportunity. Harman has class, design chops, and is already in the dashboard of every high end auto manufacturer. At this point, we have to reluctantly accept the fact that this plays into the narrative that the company lacks a clear strategy/vision. At least, none that is evident.

    And it's painful to watch the stock getting pounded. Yes, I know that tech is taking a hit, but Apple is getting massacred.
    Tim Cook's lack of vision is ridiculously bad. The guy needs to be replaced ASAP before the Apple brand loses its shine.

    The guy is a nuts and bolts guy. 

    Seems like the only vision Cook has is to make political statements and use Apple to push his social agenda. MAKES ME SICK.

    The guy is literally costing Apple shareholders HUNDREDS OF BILLIONS in value. With a competent CEO Apple would be worth more than a TRILLION DOLLARS. 
    I'm glad Apple doesn't focus on your bottomline...If Apple makes you so sick then sell your stock and stop bitching! Go elsewhere....instead you choose not to. 
    ration alapplepieguy
  • Reply 19 of 54
    Harman is the leading OEM vendor for automotive entertainment systems. I believe that they account for more than half of the market. As noted by others, Harman markets its products under many different labels, including harman/kardon, JBL, Infinity, Mark Levinson, Lexicon, B&O, and Revel.

    Samsung seems like a good fit. Harman has a dominant position in the pro and mobile audio markets, while Samsung is the leading TV and OEM LCD panel manufacturer. Harman also has a very strong position in the home audio/theater market, and the combination with Samsung could work well.

    But, automotive systems is Harman's moneymaker. And they did need a partner to ensure their future competitiveness in that market.
  • Reply 20 of 54
    Samsung - the next generation of exploding cars.

    davencalinolamacguyapplepieguy
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