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| Version 1 | Version 2 |
|---|---|
| Samsung to invest $7bn in China memory chip factory | Samsung to invest $7bn in China memory chip factory |
| (about 1 hour later) | |
| Samsung Electronics, the world's biggest memory chip maker, has unveiled plans to invest $7bn (£4.4bn) to build its first chip factory in China. | |
| Samsung will initially invest $2.3bn in the plant, which will make chips for smartphones, tablets and MP3 players, and increase its investment gradually. | Samsung will initially invest $2.3bn in the plant, which will make chips for smartphones, tablets and MP3 players, and increase its investment gradually. |
| The firm has been looking to tap into the lucrative Chinese market, but there have been fears of technology leaks. | The firm has been looking to tap into the lucrative Chinese market, but there have been fears of technology leaks. |
| Samsung won government approval to build the plant earlier this year. | |
| In an emailed statement to the BBC, Samsung said the new facility would help it "rapidly respond to meet the fast-growing demand from customers and further strengthen competitiveness in the memory industry". | |
| The plant is expected to start production by the end of 2013. | The plant is expected to start production by the end of 2013. |
| 'Perfect sense' | 'Perfect sense' |
| Over the years, China has become a leading manufacturing hub for consumer electronics. | Over the years, China has become a leading manufacturing hub for consumer electronics. |
| Contract manufacturers such as Foxconn, have been making gadgets ranging from smartphones to tablet PCs for leading global brands. | |
| Many of these products use memory chips manufactured by Samsung. Analysts said having a production facility in China would help Samsung to further strengthen its position with its customers. | |
| "Inventory cycles are very short for electronics manufacturers," Tim Charlton of Charlton Media Group told the BBC. "You need to be close to your customers for inventory and delivery reasons." | "Inventory cycles are very short for electronics manufacturers," Tim Charlton of Charlton Media Group told the BBC. "You need to be close to your customers for inventory and delivery reasons." |
| He explained that being in China would help Samsung take out extra layers of transport and storage and ensure speedier deliveries to its clients. | |
| "It makes perfect sense for them." | "It makes perfect sense for them." |
| Domestic demand | |
| Along with becoming a global electronics manufacturing hub, China has also seen a rise in domestic demand for consumer electronics. | |
| China's economic growth over the last few years has seen income levels rise in the country, giving more disposable cash to its consumers. | |
| That has turned China into one of the biggest and fastest growing markets for high tech gadgets. | |
| Domestic demand in China is likely to grow even further in the coming years, which analysts say will result in higher demand for memory chips. | |
| They say Samsung's decision to open a production facility in the country will help it tap into the growing market and maintain an edge over its competitors. |