2005 flat-panel TV battle: to profit or market share

After nearly a year of price war, flat-panel TV market competition finally at the end of 2005 reflects the essence of the technology competition. The domestic brand is eager for a fight in sales has won an overwhelming victory, but because the upper reaches of the panel did not grasp the core technology, and will face the performance losses on horizon. In the traditional TV competition did not occupy the advantage of foreign brands after a comeback, with the help of the industry chain to take truly guide the tablet industry trend, houjinshizu.

PK one: to profit, or to market share

Upgrading of industrial technology will often lead to changes in the industrial structure and market position and share, this sentence on the flat panel TV this relatively new battlefield, but also really is not false.

In 2005, with a round of price avalanche avalanche, domestic TV manufacturers from the beginning accounted for sales advantage, and ultimately to control the domestic market share of 80%.

But share does not mean profit. In the event of CCTV TV manufacturers alliance pushing a high-definition television at the beginning of December, local manufacturers have all been "each sell a color TV, high threshold to pay 1440 yuan fee to CCTV viewing" firmly tied, have watched helplessly as Hitachi, Matsushita Japanese manufacturers won "gold license".

The awkward fact clearly depicts the profit status of both Chinese and foreign, for the price of hundreds of million domestic flat-panel TV manufacturers, in any case not equal for each 1440 yuan of profits; and foreign manufacturers, although the market share is not much, but because the control panel and all downstream and most directly observed global plate heat within the range, and then grasp the optimal timing of its panel production line upgrade, and with the help of the huge cost effective occupation of the terminal market constantly sharing panel production line, so as to ensure that the gross profit is very high.

While the more serious and dangerous, the foreign giant believes that the time has come, launched on the market China counterattack when, on the verge of the loss of the edge of the domestic color TV enterprises are unable to grasp the upper reaches of the core technology, but in the future for a long period of time, continue to dominate sales in the enterprise in the price war. In order to ensure their own first to survive. "But go on, China's color TV industry will inevitably escape the fate of reincarnation, repeat the mistakes of CRT." A senior analyst in the color TV industry for many years to evaluate this.

PK two: how to control the industrial chain

In the relevant experts and the industry view, resulting in the difference between the local and foreign reasons for the situation, mainly on the two sides of the industrial chain to control the degree and different mentality.

In this year, the domestic color TV circle, many manufacturers have to follow up and the boss, "to occupy a space for one person in the tablet era, we must start grabbing market share from now on, even if the operation of zero or negative margins to do". In the opinion of foreign giants, so desperate to compete for market share manipulation is not a normal vision of the industry. SHARP insiders have said: compared with last year, the world's 8 million 910 thousand LCD TV purchase volume, but China's shipments accounted for only 220 thousand of the global market share of 1 / 40. In such a region has not really played out the potential and growth as a heavyweight market, losing money is not worth making a share." As a result, when the domestic brand color TV price in 2005 are all avalanche, foreign brands have only according to its own factory provided in the most economical cutting ratio under the capacity of rational price, simply for a certain type of price adjustment.

In addition, due to the "consuming too many resources in the consumer market will not be able to participate in the competition in the upstream and downstream industries will never be able to get the dominant position" the logic of identity, cycle pattern of Japanese and Korean companies often particularly valued the development of the industry. He spared no expense upgrade, expansion LCD and PDP panel production line, has become their collective force in the direction of 2005 -- SONY and Samsung joint venture $2 billion to build the world's largest seven generation LCD plant; SHARP $1 billion 400 million to build a eight generation LCD factory; and LG was officially put into operation in September this year fourth plasma module production line using a nearly $600 million built.

With foreign counterparts in the industry early focus on the control of the upstream, in the future in order to get a favorable competitive position in the industry compared to the lofty vision, domestic brands in the 2005 from analog to digital, from CRT to flat-panel TV industry comprehensive technology in the process of upgrading, although also follow into the flat areas and continue to force, but due to inertia velocity lag and decision-making, and in the flat-panel TV volume of the speed and scale of judgment, wrong direction -- industry decision instead of prediction to the panel amount so quickly, in quite a long period of time, will adhere to the CRT as part of their future depends on the the main source of profits, and the allocation of resources is still the main pressure in the CRT.

As a result, when the era of flat-panel suddenly overwhelming as the advent of the time, China's color TV manufacturers will quickly become a "post processing" processing enterprises. "For the front panel, LCD-TFT screen backlight, backlight module and basic circuit and other core components, China's 9 major TV manufacturers are taking all the way to buy the whole assembly, to interface circuit, power supply and a casing shape mold." Wang Dianfu, chairman of the board of directors of SKYWORTH, frankly