Samsung Mulls Major Executive Changes After Year Of Down Smartphone Sales

Samsung, one of the largest smartphone vendors in the world, is considering major changes to its executive offices after a year of disappointing smartphone sales, according to a report by the Wall Street Journal.

The Korean conglomerate is considering an assortment of moves, including removing Co-CEO and mobile head J.K. Shin from his role. In this scenario, Co-CEO B.K. Yoon would take over as head of Samsung's mobile division. No final decision has been made, according to the report.

Samsung did not reply to a request for comment on the matter.

[Related: Samsung To Cut One-Third Of Smartphone Models As Profit Continues To Plunge]

"Samsung has to be more innovative," said Steven Kantorowitz, president of CelPro Associates, a Samsung partner based in New York. "Apple has that loyalty among its user base, so Samsung has to take it one step further, maybe even two steps further, with each release. Because the Apple world has such loyalty there, Samsung has to crush them with each release. They can't just innovate a little bit. They have to be two steps ahead with their new releases."

Last month, Samsung announced its lowest third-quarter profit in almost three years as it dropped nearly 50 percent. This comes after reporting a 20 percent drop three months earlier. During that same second-quarter earnings call, the company acknowledged disappointing Galaxy S5 sales numbers after its flagship phone's release in April.

"Samsung has good products, but Apple is even more competitive now with the iPhone because of the display size that it has," Kantorowitz said. "It has to be more than just a nice device. It has to be a blow-away device. You've got to get to the point where people will actually sleep outside your store."

At this time last year, Samsung held one-third of the worldwide smartphone market share, according to IDC, and has since fallen below 24 percent. The company has struggled in developed markets to compete with Apple's iPhone, while in international emerging markets Samsung has been losing the battle over the entry- to midlevel market with Chinese vendors Xiaomi and Lenovo.

Just last week, the company revealed it plans to discontinue up to one-third of its smartphone models.

"We plan to streamline our smartphone models, in order to maintain price competitiveness in the middle to low-end segments and ultimately reduce costs," a Samsung spokesperson said. "We will continue to innovate and strengthen our product portfolio to benefit consumers across the world."

Samsung recently launched its Galaxy Note 4 and Note Edge models in time for the holiday season and launched the Galaxy Alpha in September.

PUBLISHED NOV. 25, 2014