SONY Samsung panel joint venture reflects the strength of the two contrast changes

The Associated Press recently published a review article said that as long as the Samsung joint venture with SONY LCD panel production plant S-LCD a little attention, enough to find a contrast of changes between the two Asian electronics giant. Part of the production plant by Samsung S-LCD management, as through the vineyards and farms of the futuristic city, built edifice, tennis courts, cafeteria, gymnasium and other facilities for the clinic, 4000 employees. In contrast, SONY is rarely involved in the production and operation of joint ventures, only 20 employees in the factory corner of the office.

SONY relies on Samsung LCD panel shows that the Japanese company has lagged behind Samsung, once the TV market leader is declining in the rapid development of flat-panel TV market, the question is why SONY financial deficit and Samsung income continued to increase?

Under normal circumstances, the two companies are competitors, but SONY has invested $1 billion and Samsung joint venture, the main reason is that SONY does not own the production of LCD panels, but the need to meet the rapid growth of flat-panel TV market, SONY officials also admitted they did not think that popular flat-panel TV so quickly.

S-LCD factory is located in the southern part of the country, every month can provide 30 thousand motherboard for the production of LCD panel for SONY, it is just half of the plant capacity, to meet the monthly 360 thousand 32 inch TV demand. The motherboard is divided into liquid crystal panels of different sizes, backlight and liquid crystal panel through the light color and image, instead of the traditional cathode ray tube heavy tv.

SONY was founded in 1946, in recent decades, the company has been synonymous with high-quality electronic products, with its flagship products such as Walkman and PlayStation to become the world's leading enterprises. In recent years, SONY has gradually lost its dominant position in the market: in the portable music player war lost to Apple's iPod, the flat-panel TV market has gradually declined. Earlier this month, Apple announced the iPod in Japan, Japan's market share has risen to 60%.

Relatively young Samsung Electronics was founded in 1969, the company has gradually become a global leader, which is inseparable from the company's more focused strategy. Samsung has dominated the field of electronic products, becoming the world's largest manufacturer of memory chips, and compete with South Korea's rival LG- PHILPS LCD panel's first major awards.

SONY sales decline while Samsung is growing, from 7 to September this year, the two companies sales are roughly the same, reaching $14 billion.

Management expert Toshiaki Kitaoka recently wrote a Book claiming Samsung poses a threat to japan. Kitaoka believes that SONY and other Japanese electronics manufacturers must have absolute dominance in key products, the need to adopt a global strategy and more alert. Otherwise, they will repeat 30 years ago, the United States General Electric and RCA in front of the Japanese companies, including SONY, including the loss of competitiveness.

Kitaoka said at the same time, the Japanese enterprise management is too satisfied, but also for superior technology is too arrogant, and Samsung has caught up with or even surpass many of Japan's technology".

At the same time, South Korea also launched a challenge to other enterprises in Japan: the modern automobile and eighth global sales of Honda cars go hand in hand, Pohang iron and steel has recently become the Tokyo stock market on the first South Korean enterprises.

Analysts said Samsung was smart, because the company is in the adjustment of the global strategy focused on specific advantages compared with SONY products, operating a variety of services, including movies, music, video games and even banking.

In addition, Samsung uses a more centralized management model, which helps the company to run quickly, while SONY's decision-making process because of the need to seek the views of the majority of people is relatively slow. SONY officials even dazzled Samsung's agility.

Keiji Nakazawa, chief financial officer of SONY director S-LCD said, "Samsung decision very quickly, we should apply this to all Japanese companies including SONY, but first of all, the need for comprehensive consideration, and make a detailed business plan."

Standard & Poor's analyst John Yang said that SONY changed the arrogance of the establishment of a joint venture with Samsung LCD panel, on this point, SONY is smart. LCD panel production needs to invest a lot of money, SONY needs to catch up as soon as possible. He said, unless the production of their own panels in their own factories, or will become a 'deadly meat'."

In the fiscal year ended March 31, 2006, SONY is expected to reach $84 million loss, but sales will remain stable, while product prices will decline. Intense price war from Chinese manufacturers SONY and Samsung have a great impact.

In contrast, from 7 to September this year, Samsung's net profit reached $1 billion 800 million, down by 30%, mainly due to the decline in the price of Samsung chips, mobile phones and LCD display pillar business. Nevertheless, still much higher than SONY's $246 million profit over the same period.

Just this month, Samsung and SONY announced an increase of $84 million, the monthly production capacity of the S-LCD plant will increase by 15 thousand, from July next year, the monthly production will reach $75 thousand.

Nevertheless, SONY officials said the company still other companies including Samsung, Bravia flat-panel TV is better than the product, because SONY's TV technology can ensure better picture effect and wider viewing angle