Reuters is reporting that Japan’s two TV electronic giants Sony and Panasonic are staying firmly committed to their TV businesses, despite in both cases having lost serious amounts of cash over the past few years.
The report says that both parties see benefits coming from a wider range of related products, audio systems, for example, games consoles, games and image sensors in Sony’s case and, of course the higher margins that are now flowing from high-end 4K displays.
“TVs are the soul of Sony and we don’t want to be without them,” Ichiro Takagi, head of Sony’s home entertainment and audio business, quoted Reuters.
Other observers say that quitting the TV business would impact Sony, and diminish the value of the Sony brand.
But the mighty have indeed fallen over the past two decades. Sony, whose Trinitron brand once dominated the quality end of the TV market (although only a share of some 10 per cent) now has just 7 per cent of an industry where its brand’s reputation was King. Panasonic has just 4 per cent. The pair’s South Korean rivals – indeed, arch-rivals – Samsung and LG together hold about 40 per cent of the TV business.
Takagi says that Sony’s results last year showed a small operating profit, and thus reversed years of losses, and that TV is the soul of Sony.
And certainly in Sony’s case the fight-back is gaining momentum. Reuters quotes sales results at the USA’s ‘Best Buy’ electronics retailer where Sony has quadrupled its sales of high-end TVs (to a 12 per cent market share).
Panasonic has not enjoyed quite such a dramatic turnaround. It suffered 7 years of consecutive losses from its TV division and has shifted its focus to so-called ‘white goods’ but the company says it will stay with TVs if only because the combined elements of TVs, washing machines, fridges and the like appeal to some retailers.