Samsung CEO apologizes for stifling phone performance

Samsung Electronics Vice Chairman and co-CEO Han Jong-hee on Wednesday apologized over the escalating disputes surrounding performance issues of the tech giant’s latest flagship Galaxy S22.

“We were unable to properly consider our consumer’s needs,” Han said as he bowed deep in apology in front of some 1,600 shareholders attending an annual general meeting both in-person and online.

It was the first time that a top Samsung executive has offered an apology to the public amid complaints growing over the latest smartphone’s controversial game optimizing service.

The GOS is software that adjusts the performance of smartphones to help batteries last longer and prevent overheating issues when using apps that make heavy use of the phone’s resources.

Samsung has installed the software since the Galaxy S7 series launched in 2017 but it used to be an option that can be switched off depending on the user’s choice. For the latest S22, however, the software was switched on automatically even for other popular apps.

As a result, the software limited the phone’s overall performance to only 53.9 percent of its promised capacity, according to Geekbench, a global platform that measures smartphone performance. The platform recently removed Samsung’s recent phones and tablets from its evaluation list, citing the credibility issue.

Samsung last week announced it would fix the problem with a software update but the public anger has shown no sign of abating.

As widely expected, the latest controversy topped the agenda during Wednesday’s general meeting, with shareholders criticizing the top management for mishandling the issue, calling for countermeasures.

“The GOS was designed to optimize the phone’s performance considering the diverse characteristics of gamers,” Han said. “The device’s consistent performance is crucial when enjoying high-end games so we limited the performance of CPU and GPU to the appropriate levels to minimize overheating while maintaining consistency.”

“We will listen to our users’ voices more carefully and reward them with the best quality and service so as not to repeat similar issues,” he added.

Asked about safety issues from overheating following the software update, Han said, “We will secure safety using a heat control algorithm. We will continue to add new functions to prevent overheating.”

Other tricky questions were also raised during the meeting.

On Russian operations, the CEO said the company, having already suspended shipments to the country, is closely watching the situation to minimize the impact on its business. Samsung is the No. 1 smartphone maker in Russia, with an almost 35 percent market share.

He added that the company was open to merger and acquisition deals regardless of sector and deal size, if they are considered helpful for its sustainable growth and enhanced shareholder value.

Han pinpointed artificial intelligence and 5G-based automotive solutions as one of the lucrative new growth drivers, suggesting that the company was also betting big on the still nascent metaverse.

Facing both internal and external challenges, Samsung has been suffering from a fall of almost 30 percent in its stock price. Compared to a year ago when the price hit a record high of 91,000 won ($73.67), the stock is currently hovering at some 70,000 won.

The company said it would roll out dividends worth 9.8 trillion won every year to elevate shareholder value.

In the day, nominations of the four new internal board members -- Kyung Kye-hyun, co-CEO who oversees the chip business division, Roh Tae-moon, the mobile business chief, Lee Jeong-bae, the memory chip business chief, and Park Hak-kyu, president of management support -- were approved in a majority vote. 

Kan Han-jo, a financial expert who currently serves as chairman of Hana Financial Group Foundation, was named the board chairman, becoming the second external board member to assume the post.

By Lee Ji-yoon (jylee@heraldcorp.com)