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5 March 2019

Samsung shuts down Artik business in IoT setback

Samsung Electronics very quietly announced that it would be shutting down its Artik business, back in December – so quietly in fact that the only report was in Business Korea. It’s a decision that shows that even the largest technology firms are not able to hit home runs for IoT projects, and it does prompt questions about the longevity of Samsung’s SmartThings platform.

There had been a significant lack of enthusiasm for Artik. Reports of outages and bugs were concerning, and the silicon seemed well suited for prototyping but not so much for commercialization. Back in October 2017, Samsung merged SmartThings, Samsung Connect and Artik Cloud into one new service, called SmartThings Cloud, which was the source of quite a few of those complaints, but its limited hardware selection meant that the ecosystem never really took off for Artik.

We first reported on Artik back in May 2015, when the Artik modules were unveiled. The three variants (Artik 1, 5 and 10) covered different needs, with the Artik 1 running the Nucleus operating system, while Yocto Linux was used for the more powerful versions. The Artik 0 and 7 were added in October 2016, but in February 2017 Samsung announced it was killing off the Artik 10 – booting developers from the 32-bit design to the Artik 7’s new 64-bit architecture. The Artik 053 appeared in May 2017, alongside updates to the Artik Smart IoT Platform.

Since 2017, a few partnerships have been announced, with Silicon Labs, Cypress, Trustonic, SAP, the OCF, PTC and TeamViewer. The right noises were being made, and it looked like the ecosystem was growing, but there was never much fanfare about customer wins.

One of the most promising developments came when Samsung announced Artik Cloud Monetization, back in August 2017. THis was a strategy that would let any Artik system-on-chip user sell data derived from those devices into a data marketplace. At the time, it looked like a great way to boost demand for the hardware and associated platform, as it would be a way for adopters to hasten the return on investment, generating post-sale revenues from devices in the field.

Samsung is probably making the best decision by canning Artik, as the division has probably never produced revenues significant enough to be included on its balance sheet, but it’s still worrying for the IoT industry that a company as powerful as this can’t make a success of a project like Artik.

It was a sensible strategy to try and foster its own semiconductor sales by fostering an ecosystem. Of course, the idea of a single-supplier for silicon is a little off-putting for many potential customers, but one can probably count on one of the largest semiconductor suppliers to be around for the life of a project.

Similarly, Artik could have had internal relevance for Samsung, powering the smart home devices in its SmartThings ecosystem. Samsung bought that start-up for around $200m back in 2014, snapping up one of the most fleshed-out smart home platforms. Of course, we had enthusiastic visions of the plethora of ways that Samsung would leverage its position in smartphones to drive sales of SmartThings, and how its white goods appliances could serve as entry points into the smart home, but in fact, there has been very little progress.

All this adds up to a few major questions about Samsung’s vision for the IoT. It has (had) all the right tools, it has a huge customer footprint, and it has plenty of cash – so why can’t it come out with a killer feature or application in the consumer-facing IoT?

As CDRinfo reports, Samsung Electronics is reportedly undergoing internal restructuring, to focus on AI, automotive and 5G. To this end, SmartThings may well be sold off or even shut down, if leadership decide that it is no longer part of the strategic vision.