Nokia vs Samsung

Nokia was founded in 1865 as a wood pulp mill on the banks of the Nokianvirta river in Finland by Fredrik Idestam. The company name came from the river. Nokia later diversified into rubber products — including the rubber boots that became famous across Northern Europe — and then into cables and electronics. By the 1960s, Nokia was a conglomerate making paper, rubber, and consumer electronics with no particular specialisation.

Nokia CEO Jorma Ollila made a radical decision in 1992: sell everything except mobile phones. Nokia divested its paper, rubber, cable, and consumer electronics divisions and bet the entire company on the emerging mobile telecommunications market. It was considered an absurd gamble — Nokia was a minor player in a market dominated by Motorola and Ericsson. By 1998, Nokia was the world's largest mobile phone manufacturer, holding over 40% of the global market.

The Nokia 3310, launched in 2000, sold 126 million units and became one of the best-selling consumer products in history. Nokia's ringtone — a melody taken from Francisco Tárrega's "Gran Vals" — was heard over 1.8 billion times per day worldwide. Finland's GDP was meaningfully dependent on Nokia's performance. The company seemed invincible.

Nokia's internal engineers had developed touchscreen prototypes as early as the late 1990s. The company had the technology to build a smartphone years before the iPhone. Internal research predicted that consumers would want internet-connected touchscreen devices. Middle management killed the projects repeatedly, believing they threatened Nokia's existing hardware business. When Steve Jobs unveiled the iPhone in January 2007, Nokia's CEO dismissed it as a niche product. Within five years, Nokia's market share had collapsed from 40% to under 5%.

Microsoft acquired Nokia's mobile phone business in 2013 for $7.2 billion. The acquisition was a disaster. Microsoft wrote down $7.6 billion — more than the purchase price — in 2015, and laid off 25,000 employees. The Nokia brand was sold to HMD Global in 2016. The Nokia 3310 was relaunched as a nostalgia product in 2017. People bought it entirely for sentimental reasons.

Nokia spent 2023-2025 cutting between 9,000 and 14,000 jobs — reducing its global workforce from 86,000 to around 75,600 — as 5G infrastructure spending by telecom operators collapsed after the initial deployment boom. Spending on radio access network products fell from $45 billion in 2022 to $35 billion in 2024. Nokia restructured from five business units into two, hired its first American CEO, and accepted a $1 billion investment from Nvidia to develop 5G and 6G software running on GPUs. The company that had once made rubber boots and then dominated mobile phones was now fighting to survive as a network infrastructure supplier — in a market it had helped create, against rivals who had caught up.

Lee Byung-chul founded Samsung — meaning "three stars" in Korean — in 1938 in Suwon, South Korea as a small trading company selling dried fish, vegetables, and noodles. The company had 40 employees. Korea was under Japanese colonial rule. Lee expanded into sugar refining, wool, and insurance in the 1940s and 1950s, building Samsung into one of Korea's first major conglomerates — known as a chaebol — through relationships with the postwar South Korean government.

Samsung entered the electronics business in 1969, initially making black-and-white televisions under licence from Japanese manufacturers. The South Korean government's industrial policy actively supported chaebol expansion into strategic industries, providing cheap loans and trade protection. Samsung Electronics grew rapidly by producing consumer electronics for export — initially as an OEM manufacturer for foreign brands. The relationship between Samsung and the South Korean state has remained close and occasionally controversial ever since.

Lee Byung-chul announced Samsung would enter the semiconductor business in 1983 — a decision that Korean banking analysts considered reckless. Samsung had no semiconductor expertise, no technology, and would be competing against Japanese and American companies with decades of advantage. Lee invested $100 million of his personal fortune and sent engineers to study American chip manufacturers. Within a decade, Samsung was the world's largest producer of DRAM memory chips. The bet became one of the most successful industrial strategy decisions in economic history.

Samsung had manufactured components for Apple — processors, displays, and memory — since the original iPhone. In 2010, Samsung launched the Galaxy S smartphone directly competing with the iPhone, while remaining Apple's largest supplier. The two companies spent years simultaneously as each other's biggest customer and biggest competitor. In 2016, Samsung launched the Galaxy Note 7 to acclaim — until batteries began catching fire. Samsung recalled 2.5 million devices, replaced them, then recalled the replacements when they also caught fire. Airlines banned the Note 7. Samsung permanently discontinued it, writing off $5.3 billion. CEO Lee Jae-yong was arrested on bribery charges months later.

Samsung reported full-year 2025 revenues of KRW 333.6 trillion — approximately $230 billion — and operating profit of KRW 43.6 trillion, up 33% from 2024. The Q4 2025 performance was historic: quarterly revenue of KRW 93.8 trillion and operating profit of KRW 20.1 trillion — tripling year-on-year — driven by surging AI data center demand for memory chips. Samsung's chip division alone generated KRW 16.4 trillion in Q4 operating profit. Samsung had finally received Nvidia approval for its HBM3E high-bandwidth memory chips after lagging behind SK Hynix, and had begun sampling its next-generation HBM4. The company that had started selling dried fish in 1938 was now the world's largest memory chip manufacturer, supplying the AI infrastructure that was remaking the global economy.