Toshiba comes on board Blu-Ray
In February 2008 senior executives of Toshiba made a tearful farewell to their attempts to make the HD-DVD format a success over their rival Blu-Ray. The decision became inevitable after Warner Bros, Sony Pictures, Walt Disney and Twentieth Century Fox said they would only release their films in the Blu-ray format. Sixteen months later Toshiba is to start making products that can play Blu-ray discs.
Video Case Study: Problems for Iconic Japanese Manufacturers
Iconic Japanese manufacturers feel the pain of the global downturn
Sony, Toshiba and Panasonic are iconic global manufacturers but they are all suffering to a greater or lesser extent from the combination of a rising Yen and the impact of falling global demand. These two video clips provide an illustration of the impact of changes in the exchange rate and the world economic cycle.
Download the video case study handout
Video_Panasonic_Sony.pdf
Further chaos in the Japanese economy
Hat tip to a number of colleagues for this!
Further bad news has rocked the market after Wasabi Bank took a pasting, Tempura Bank took a battering and another slice was taken out of Sashimi Financial Services. Sepuku Bank has already had the guts ripped out of it, and Teriyaki Bank has been accused of cooking the books, as its last results were just a flash in the pan. On a more positive note, results at Tofu Bank wobbled but remained fundamentally healthy.
With fear of a looming recession, panic has now spread to the industrial sector. Increased gearing has been seen in the automotive industry, where a whole clutch of companies is being depressed. Toyota, previously an engine of growth, has now stalled, tyre makers have generally been deflated and the wheels have totally come off Honda. The computer industry seems to have terminal problems, and Dentsu has widely advertised its concerns. The drinks industry has suffered from a hangover of stock, and the froth has been taken off shares in Kirin, while Asahi has been forced to dilute its holdings due to a shortfall in liquid assets. After concerns over product taste at Suntory, the Chairman has decided to hop it.
Other sectors are faring no better. Sony could not console itself, and its shares are now going for a song. Toshiba’s performance has hardly been electrifying, and Yamaha hit a bad note after a key Board decision to cut pay scales. There are rumours that noodle producers have over-egged their results, and growing concerns that YKK may soon come undone.
The Governor of the Central Bank has expressed a yen for the ‘good old days’, and further casualties are expected in the private hospital sector, where analysts accuse companies of doctoring their results in an attempt to ward off closures. Firms have responded by asking for patience, as their balance sheets recover. Some have already received a transfusion of funds, but are still operating at a loss, and claiming that results are sickening.
Nokia cuts prices as battle for market share in handsets hots up
Nokia has increased its market share for handsets from 38.4% to 40.9% according to second quarter data from CCS Insight and reported in an article in the Times yesterday. The intense battle for market share is resulting in periodic price wars and the economic downturn seems to have precipitated another one - Nokia is reducing prices by up to 10% .
The mobile phone handset industry is best described as an oligopoly. In the second quarter of 2008 the leading five manufacturers accounted for 83% of world sales.
Nokia 40.9
Samsung 15.3
Motorola 9.4
LG 9.3
Sony Ericsson 8.2
The global mobile phone market grew by 12.3 per cent year-on-year in the first half of 2008 with shipments reaching 584 million units - the economies of large scale production in this kind of industry must be absolutely enormous. The power of the brand and the impact of achieving lower costs per unit are two of the key competitive drivers that impact on consumer prefereces.
Nintendo poised to overtake Sony in the consoles battle
Sony has released results showing that it has sold 14.4 million PS3 machines worldwide since it went on sale late 2006 but this might not be enough to prevent Nintendo from overtaking them as the world’s biggest seller of computer games consoles in 2008. This classic oligopolistic market continues to see vigorous price and non-price competition between the three dominant players - Sony, Nintendo and Microsoft. This week - all ten of the top UK selling computer games are either for the Wii or Nintendo DS and five of the chart toppers are produced by Nintendo themselves. The company has sold more than 10 million Wii consoles and 70 million DS handheld machines worldwide.
More background available here “Consoles look to hit their stride”
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