What’s Next For Samsung? That’s The Question In Saga Of Korea’s Biggest Conglomerate

Like it or not, the South Korean economy depends to an inordinate extent on Samsung Electronics, the centerpiece of the Samsung conglomerate with interests from shipbuilding to electronics, and the fate of the heir-presumptive, Lee Jae-yong, widely known as Jay Y. Lee. Samsung Electronics earnings from products ranging from semiconductors to smartphones is equivalent to about 12% of Korea's GDP.

Journalist Geoffrey Cain leaves the reader hanging at the end of his book, Samsung Rising, out this week, wondering how Korea's supreme court will rule on Lee's retrial on bribery charges. The bet is still that Samsung is too big and too important for the judges to jail him again on much the same charges for which he's already spent a year behind bars. But then, in the game of high-level Korean political and business intrigue, the future is never quite certain.

Cain captures the drama of Samsung in a book that reaches a climax, almost, in two great long-running battles. The subtitle of the book, "The Inside Story of the South Korean Giant That Set Out to Beat Apple and Conquer Tech," is intended for a global audience caught up in Samsung's battle with Apple, a rivalry played out in American courts. Samsung was ordered at one point to pay a mammoth fine for ripping off Apple's ideas. Somehow, as Cain reports, the case dissipates in appeals and doubts and conflicts of interest, the most compelling of which is that Apple still depends on Samsung to produce some of the inner works for its fabled iPhone.

Every bit as compelling, although perhaps not to foreign readers, is the convoluted tale of how Samsung under Lee got involved in the fascinating series of events that led to the downfall of Park Geun-hye, daughter of Park Chung-hee, the dictator who was assassinated in 1979. Park, Korea's first female president, is still languishing in prison following her ouster in the Candlelight Revolution of 2016. Years from now, historians will be parsing over the origins of a political scandal that involved sponsoring the equestrian team of the daughter of Park's closest aide, Choi Soon-sil. Often referred to as a Rasputin-like figure in media reports, Choi is also serving a lengthy prison term.

How all that happens is the essence of the more or less climactic chapter, appropriately named "My Kingdom for a Horse." It all had to do, as Cain explains, with the need for Lee to consolidate his holdings through the takeover of one Samsung entity by another at a price that was deemed to be too low. Just to top everything off, activist hedge fund Elliott Management got into the act, loudly but vainly protesting share prices that were much undervalued.

Always lurking in the background is Jay Y.'s father, Lee Kun-hee, bed-ridden, in a coma, a tragic final act in the life of a man whose dynamic demands in endless speeches, famously telling legions of staffers to "give up everything but your wives and children," had driven Samsung to such heights. The Samsung drama goes way back to Lee's father, Lee Byung-Chull, who founded the group and then gave the crown jewel, Electronics, to son Kun-hee, leaving Cheil, the food entity, to oldest son Maeng-hee, who had somehow incurred his father's displeasure.

Yes, it was Maeng-hee's daughter Lee Mie-kyung (Miky) and son Lee Jay-hyun, who spurred the deal for Dreamworks, made CJ, as it came to be called, Korea's biggest entertainment company. They put up the capital for the Academy Award winner, Parasite, all unimaginable years earlier, but that's just a sidebar in the family and corporate saga.

It's all so complicated. Cain has trouble encapsulating the drama in less than 300 pages, but he pulls no punches, touching raw nerves of rivalries and repression and clashing egos in an account that's unavoidably murky at times, but riveting current history. Not the least revealing aspect of the book revolves around the conflicts between the brilliant Americans who had much to do with Samsung Electronics' rise and the executives back in Seoul, sometimes great, open to ideas, enthusiastic, also negative, critical, unrealistic and unimaginative.

Much more will be written about Samsung in years to come. It's an unfinished drama, awaiting the next act, as is clear from Cain's final sentence, "As this book went to bed, Jay Lee was still on trial."

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