Samsung Electronics Co. is spending more than $100 million on its sponsorship of the Beijing Olympics, a sum that is helping fuel faster growth in one of the company's biggest and most important markets, its top China executive said.

China has long been a major manufacturing base for Samsung, and sales of its cellphones and other gadgets are growing quickly here. The Korean technology giant expects revenue from its China operations -- including sales in the domestic market and exports of products made in its Chinese plants -- to reach $33 billion this year, up from $17 billion in 2005, said Keun-Hee Park, chief executive of Samsung's Greater China business.

Mr. Park said the Olympics sponsorship has greatly increased Samsung's profile in China. The Games have had "a relatively big impact on our business," he said. Samsung will be providing thousands of mobile phones to VIPs during the Games, some of which will allow users to watch televised content on Samsung's specialized Olympics software via China's domestically developed high-speed wireless networks.

Mr. Park said he is also working to expand Samsung's production operations in China so they include more of the value chain over the next five years. The company already has 23 research-and-development centers in China.

"My most important objective here in China is for us to be able to manage the value-chain activities for all global products produced in our China manufacturing bases, from product planning, design, R&D, purchasing, logistics," he said. "We want to be a Chinese company operating in local soil."

Samsung, whose products also include liquid-crystal-display television sets and semiconductors, has been a full sponsor of the Olympics since the 1998 Winter Games in Nagano, Japan. This year, it was also an Olympic torch-relay sponsor, though that proved to be problematic when the relay was disrupted with large demonstrations by pro-Tibet protesters in Europe and the U.S.

"I wouldn't say the [protests] have had no impact on us," said Mr. Park, who will be an Olympic torch bearer in Sichuan next month. But echoing other sponsors, he says he hopes the Games will be used as a way for people to get a better understanding of China and hopes such events won't happen again.

Samsung surpassed Motorola Inc. in the fourth quarter of 2007 to become No. 2 in China's cellphone market by unit sales, after Nokia Corp., according to technology consultants Analysys International. Samsung had 13.2% of the 39.96 million units sold in China that quarter, compared with 11.6% in the previous quarter.

With the Olympics, Mr. Park's goal is to raise the profile not just of Samsung's cellphones but also other products among China's consumers, who he said are more discerning than consumers in many other markets.

"It seems people [in China] perceive Samsung as a really young and fast-growing brand," he said. "We want to promote our brand as the most technologically advanced brand, and the brand that produces the perfect products."

Source:wsj.com