Showing posts with label Samsung. Show all posts
Showing posts with label Samsung. Show all posts

Tuesday, April 02, 2013

Sony’s (Intelligent?) bet on The Idiot Box

Sony India has been Focussing Big Time on its Television Business in India. And it seems to have paid it off well. But then, it will Certainly have to come with Some Innovative Strategies soon if it wants to continue rising up The Ranks.

“It’s a time of transition, which makes things even more difficult”. These words from Osamu Katayama’s book These are our future (which details Sony Corporation’s recent history) aptly describe the phase that this Japanese multinational is going through at the moment. First, a devastating earthquake in Japan. Then, a cyber-attack on its network. And finally, a colossal net loss of $3.1 billion for the financial year ending March 31, 2011 (Sony’s second worst financial performance ever). All this has not only made its share price tumble over 25% since the turn of the year, but has also put an enormous pressure on its chief executive Howard Stringer who is striving hard to win the battle against the odds, one after the other.

In fact, when Howard Stringer, Chairman, CEO & President, Sony Corporation, took over the reins of this Japanese conglomerate in June 2005, its three major businesses – gaming, mobile phones and television – were already losing momentum, globally. Thus, the task ahead for Stringer was not only to save these businesses from collapsing, but also identify functions and markets that could serve as alternative sources of revenue for Sony, at least till the time these businesses were back on track, live and kicking.

Although Sony had been in India since 1994, it was only then that the Indian consumers saw Sony recognising the real potential of this ‘Asian Tiger’. Thus, everything from more launches, slightly more affordable prices, to more stores, to even zero-interest finance schemes, to things which Sony had never done before, were all suddenly happening, and not just in India, but across the globe. Result: Sony’s CPD division, which sells televisions, digital imaging, audio and video products, semiconductors, components and business services, recorded a respectable profit of $35.4 million in FY2010-11, up 1.6% y-o-y, at a time when the core divisions were bleeding losses.

No doubt, the strategy paid it off well across countries, but then India seems to be special, so much so that the company is now looking at the country as a priority market and expects it to become the fourth largest market for its products in the world, contributing as much as 10% to the group’s sales in the next couple of years. In fact, Sony, which started off slow in the Indian market, is now rising up fast in a market dominated by chaebols like LG and Samsung.

Cut to the chase, the focus for the time being is on its television business, particularly the Flat Panel Display (FPD) TV market in India. In fact, as per the US-based market research firm DisplaySearch, Sony has already overtaken Samsung Electronics and LG Electronics for the top position, with 22.1% of flat panel TVs shipped in the Indian market in 2010. Even according to the GFK Nielsen Urban India Panel TV (LCD + Plasma TV) Report (for April-June 2010 period), Sony Bravia (Sony’s flagship FPD product) had become the market leader in Flat Panel Display segment in the first quarter of FY2010. It had grabbed a market share of 32% by value, and 29.5% by units sold. The company had sold more than 1,00,000 units during this quarter, more than the number of units sold by any other brand in the market. For the month of June alone, Sony had captured a significant market share, 33% by value and 29.5% by units. The company reported maximum sales in the states of Maharashtra, Delhi, Tamil Nadu & West Bengal during this quarter. For starters, under the FPD TV market, the 22-inch, 32-inch & 40-42 inch segment comprises of more than 75% of LCD units sold in the country. And interestingly, Bravia was the leader in all the three categories.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist). For More IIPM Info, Visit below mentioned IIPM articles
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Wednesday, August 29, 2012

NOKIA: LEADERSHIP UNDER SIEGE

In a span of four years since Kallasvuo took over as CEO of Nokia, the company remains the overall mobile phone dominant market leader. But of late, the leading handset manufacturer finds its position growingly threatened by competitive trends. Clearly, a major transformation is in order, and the sooner the better. by Virat Bahri

Recession was a rude awakening for many. But the problems for Nokia actually began when the smartphone category caught the fancy of consumers in the high-end segment globally — a segment where Nokia has been unable to find its footing till date in front of competitors like Research In Motion and Apple. Smart phone sales grew at a brisk 48.7% to 54.3 million units for Q1 2010 (17.2% of total mobile terminal sales) according to Gartner. But interestingly, pure smart phone player RIM made a maiden entry into the top five. The company still dominates the low-end segment, but the margins there are very hard to get, as competitors are springing out from all nooks and corners (in India itself, Micromax has gained so much ground in no time, with other players like Karbonn, Lava, Spice, Onida, et al locked in internecine pricing battles). Morningstar analyst Joseph Beaulieu has increased the fair value uncertainty rating for Nokia to high from medium in June this year. “While its scale still gives Nokia considerable cost advantages, these have become less relevant as software expertise and the ability to create a viable developer ecosystem grow in importance,” Beaulieu says.

Alarmingly, Nokia’s operating system Symbian also continues to lose market share to rivals like Android and Iphone OS, with market share at 44.3% in Q1 2010, compared to 48.8% for Q1 2009. Nokia hopes that the Meego platform based on Linux (being developed with Intel) is expected to address their problems on the software front, but that will take some time. The Symbian^3 powered Nokia N8 will be the last N-Series device to use Symbian, though the OS will still feature in the mid-range. “Although Nokia’s mid-tier products sold well, Nokia lacks a high-volume driver in the high-end. MeeGo-based devices and other high-end products will not rejuvenate Nokia’s premium portfolio until the end of the third quarter of 2010 at the earliest, and Nokia will continue to feel pressure on its average selling price (ASP) from vendors such as HTC, RIM and Samsung,” says Carolina Milanesi, research vice-president, Gartner. Lower than expected ASP and competitive market has compelled Nokia to project a flat market share, but a slightly lower value share for 2010, compared to 2009.

In the current market situation, offense can only be the best defence. Even its worst critics would admit that Nokia’s cash situation remains quite healthy and it still has the market reach that competitors could kill for. The way forward is to be nimble, and for that the company management has recently divided operations into mobile solutions for high-end mobile computers and smartphones — mobile phones for feature rich mobile phones and markets — which will handle all go-to-market strategies. Moreover, Nokia is a leader under siege, and its best bet forward has to be leading the market trend rather than bucking it. Kallasvuo’s transformation strategy was on target, but it still has to clear the test of the market.


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Thursday, July 26, 2012

Florian Müller, Founder, FOSS Patents & Co-founder of Rival Networks

B&E: Will payouts in settling patent infringement cases show on Google’s net earnings from Android?
FM: Since Google itself is rarely sued, the impact on the net earnings of device makers will be greater than on Google’s earnings. The Oracle lawsuit could, however, require Google to pay something on the order of a billion dollars depending on the exact outcome. The extent to which Android is accused of infringement is unpredecented. 42 lawsuits in a little more than a year show that there are fundamental problems. There are definitely some Android-specific reasons, such as Google’s ‘loose management’ of intellectual property issues, that contribute greatly to this mess.

B&E: Some have even pointed to security issues related to the Android OS. Is that something which handset makers and buyers should be wary of?
FM: By emphasising that the software is “free”, Google positioned Android as the poor man’s iPhone. But the security issues come with it. The Android Market is not managed well by Google. It contains programs infected by malware. I use a Samsung Galaxy, a high-end Android phone, and I like it for the most part, but I don’t have confidence in Google’s app store and never buy anything there.

B&E: Android Market Place is not giving Google enough topline push. Are the earnings enough to sustain stable Android OS projects in future?
FM: App stores can but only be a small part of a revenue mix. In Google’s case, there’s not enough money to be made there to sustain development of an OS.

B&E: Finally, will the Andoird connection enable handset and tablet makers like HTC, Samsung, LG, Dell, Acer et al, to make money in times to come?
FM: There are about three dozen device makers who have adopted Android by now and it’s clear to me that when growth rates flatten, most of them won’t make money with Android-based devices anymore. For now the explosive growth of the smartphone market creates some short-term opportunities, but strategically those device makers are in a difficult position because Google controls the platform. Google bullies Android device makers and forces them to do what it wants. Right now the biggest problem for makers of Android-based tablet makers is a lack of demand. Android tablets are a failure so far. They also turn out to be too expensive.


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