Category: The Front Line
Looking for Consumer Electronics at CES
- Published on Saturday, 17 January 2015 11:36
- Ken Werner
- 0 Comments
The Consumer Electronics Show 2015 was the biggest in history — again — but the show feels increasingly strange. For a show that is nominally about consumer electronic products, a surprising number are either not consumer products or not electronic.
A significant portion of Panasonic’s booth was devoted to a men’s grooming salon where male attendees were being barbered for free, with the barbers using Panasonic grooming devices. Not far away was a beauty salon, where female attendees were being beautified, again with Panasonic beauty products. I saw a beautician using a Panasonic hair dryer with great enthusiasm.
Samsung, LG, and others showed stoves, refrigerators, washing machines, and dryers. I mentioned to one LG representative that she reminded me of Betty Furness operning a refrigerator door in ancient TV commercials. The rep enthusiastically did her best Betty Furness imitation and opened the nearest appliance door, which belonged to a clothes dryer.
Panasonic also emphasized commercial products, including batteries, and promoted the huge battery plant it is building near Reno with Tesla Motors. Also in Panasonic’s booth was the new Tesla Model X crossover SUV, which has a 0-60 acceleration time of 5 seconds.
Continuing the trend of several years, the Las Vegas Convention Center’s North Hall looked more like an auto show than an automotive electronics show, which CEA claims it is. To be sure, most of the manufacturers were emphasizing electronic controls, navigation, or infotainment systems, but Toyota’s large booth was devoted almost entirely to its new hydrogen fuel-cell-powered Mirai (“future” in Japanese). Don’t get me wrong, Toyota’s in-depth exhibit was fascinating , but where is the consumer electronics product?
Of course, there are still lots of consumer electronic products at CES. A major trend in TV this year is the increasing commoditization of UHD (4K) TV. The speed with which 4K has gone from expensive to cheap continues to surpirse many people in the industry. If last year was the year of UHD-TV’s breakout, this year will surely be the breakout year for quantum-dot-enhanced TV. Many major manufacturers announced QD-enhanced TVs for release this year, including Samsung, LG, and TCL. Unfortunately, they will probably be called “QD-TVs.” But if we can survive “LED TV,” we can probably survive “QD-TV”, too.
Viewed side by side with conventional LCD-TVs, the increased color saturation and gamut produced by QDs provide an obvious improvement in image quality and allow TV makers to exceed 90% of REC.2020. Combined with 4K, QDs produce really compelling images. Samsung whent so far as to say that QD enhancement provides image quality that is superior to OLED. Side-by-side comparisons in a quantum-dot maker’s suite made credible case for that. The OLED display had blacker blacks, but the QD-enhanced LCD was brighter and had a larger color gamut.
When LG announced their line of QD-enanced TVs, it’s marketing people were forced to walk the top of a very narrow fence. They said the new QD-enchanced TVs offered a huge improvement over tradional LCDs, that the new sets are beautiful and that everybody should buy one — but the sets are not as good as OLED! That’s a really tough balancing act to pull off.
This year QD will be for premium sets, with TCL saying they will have a UHD 65-inch with QD for $3000 later in the year. Next year, these sets will enter the pricing mainstream. Even I may be tempted to open my wallet.
CES 2015 In The Rearview Mirror
- Published on Monday, 12 January 2015 16:12
- Pete Putman
- 0 Comments
After all the PR hype and anticipation, the 2015 International CES has come and gone, leaving me to edit over 1500 photos and a bunch of videos and sift through stacks of press releases to see what was really significant about the show…and what was just fluff.
Before I drill down to make my top picks, I should point out some trends that have been building for a few years. We all know that the majority of our electronic gadgets (phones, tablets, home alarm systems, televisions, computers, cordless phones, and so on) are manufactured in China and Southeast Asia.
Still, the expanding CES footprint of Chinese brands (Haier, TCL, Hisense, Changhong, Konka, Skyworth) takes some getting used to. So does the shrinking footprint of former Japanese powerhouses like Sony, Sharp, and Toshiba. There is a profound shift in power happening in the CE world as the center of gravity moves farther away from Tokyo and Osaka past Seoul to Shenzen and Shanghai.
Another unmistakable trend is the decline in prices for a wide range of CE products. “Connected health” was a big deal at least year’s show, but is there really any news to be found in $60 Fitbits? Or $149 home security systems? Or $125 32-inch televisions?
Speaking of televisions, they are becoming less important in the overall scheme of things with each passing year. 4K Ultra HD was all the rage last year – this year, everyone had 4K televisions, and many models were equipped with quantum dot backlights for high dynamic range. Of course, there was no shortage of curved televisions in all sizes.
The facts are these: Changhong and TCL can make a large, curved 4K LCD TV with high dynamic range just as easily as Sharp, Samsung, and Panasonic. In some cases, the LCD panels used in these TVs are all coming from the same factory.
Samsung made a big splash this year with their S UHD television line, but they’re using quantum dots just like anyone else. LG showed both quantum dots and their new M+ technology that adds white pixels to an LCD matrix to boost brightness. TCL is selling QD-equipped TVs in China and expects to launch them on these shores this year.
Perhaps surprisingly, LG decided to make a big push for OLED technology, unveiling five new Ultra HD models at the show. While the Chinese also showed OLEDs (as did Panasonic), LG appears to be “all in” with their white OLED technology, claiming manufacturing yields as high as 70%. Well, someone’s got to pick up the torch that plasma dropped in 2013.
For many of these manufacturers, appliances and white goods are taking on a more important role in contributing to the bottom line. The margins are better on high-end refrigerators and washer-dryer sets for the likes of Samsung and LG, even though consumers don’t turn them over as often as televisions. For Panasonic, beauty products are an important income stream.
Cameras and camcorders are still holding their own against mobile phones, surprisingly. I entered the CES arena equipped with both a new Samsung Galaxy 5 phone and a Panasonic Lumix ZS40 camera. While the Galaxy 5 does take some great pictures under ideal conditions, it was no match for the 30:1 optical zoom lens (Leica glass) on the Lumix – the latter allowed me to shoot under, around, and over people to get the photos I needed.
Speaking of mobile phones and tablets, there wasn’t much news to be had at the show. LG showed its updated LG G-Flex 2 and Samsung had a crowd around its Galaxy family of phones and tablets, but there just wasn’t the “BYOD buzz” we’ve seen in previous years. The 5” to 5.5” screen size seems to be a sweet spot for phones now – 6-inch models were scarce in Vegas.
Connecting all of this stuff together made for a more compelling story from my perspective, especially as far as wireless technology goes. I saw more demos of wireless video streaming, wireless appliance control, wireless security systems, and wireless display connectivity at CES than at previous shows.
The 802.11ac channel bonding protocol is becoming increasingly important for making this stuff work in the 5 GHz band. And the wide-open spaces at 60 GHz are starting to attract everyone’s attention – having 2 GHz channels to play with is a lot more appealing for making high bitrate connections than fighting the congestion at 2.4 and 5 GHz.
Display interfaces are getting fast – a lot faster – and relying on compression for the first time. And now we’re starting to see the boundaries blur between small, high-performance mobile display interfaces and full-sized versions, which leads me to wonder why we need so many versions of HDMI and DisplayPort in the first place.
I’d be remiss if I didn’t mention the growing number of automobile manufacturers who set up shop in the North Hall every year. It reminds me of the New York Auto Show, with the likes of Hyundai, VW, Ford, Fiat Chrysler, and Audi showing off their latest high-tech “connected” automobiles that can do everything from mirror your smartphone’s display to recognize speech commands, navigate flawlessly, and even drive themselves.
And there were plenty of alternatives to gasoline-powered engines to seen, from BMW’s i3 electric car to Toshiba’s Mirai hydrogen fuel cell vehicle. All equipped with Bluetooth, 802.11, Sirius, and in some cases, user-customizable dashboard displays using flexible displays (important to survive vibration and G-forces).
Quite a bit to take in over three and a half days! What follows is my list (in no particular order) of significant products and trends I spotted in Vegas. Let’s see if they hold up as the year progresses:
High Dynamic Range – as usual, a hot new technology makes its appearance at the show and quickly becomes a buzzword. HDR Ultra HDTVs were shown by numerous manufacturers at CES; none more prominently as Samsung, who made HDR the centerpiece of their Monday press conference with their S UHD line. Virtually all of these TVs use quantum dot technology to boost image brightness and color saturation, and only one (LG) had an alternative path to HDR with M+ technology.
HDR is a key part of the transition to next-generation television. So are wider color spaces, high frame rates, and increasing resolution. Looks like everyone’s getting into the game, including the Chinese. Interestingly, I saw only one demo of Dolby’s HDR technology in the TCL booth (Vizio also has it), so it appears many homegrown solutions are in the works for HDR displays.
OLEDS Are Back – at least as far as LG is concerned. Seven new Ultra HD OLED TVs were rolled out at CES with sizes ranging from 55 inches to 77 inches, and one of them can flex back and forth from flat to curved surface mode. A partnership with Harman-Kardon should ensure better audio quality than you hear from typical super-thin televisions. (There were even two models featuring bases made from Swarovski crystal!)
With the demise of plasma, videophiles are still looking for displays that can give them the magic combination of deep blacks, saturated colors, and wide viewing angles. Right now, OLEDs are the only game in town, but they’ve proven to be tricky to manufacture with acceptable yields. LG Display seems to have overcome that barrier with these models (which use IGZO TFTs for pixel switching, by the way) and it will be interesting to see the uptake as 2015 winds on.
Super MHL Is Here: The battle for fastest display interface shifts back and forth between Silicon Image and VESA. DisplayPort fired the first salvo with their introduction of version 1.3, raising the maximum data rate to 32 Gb/s and introducing Display Stream compression for the first time. Now, the MHL Consortium has fired back with Super MHL. MHL stands for Mobile High-definition Link, and in its first iteration, allowed transport of 1080p/60 video over the 5-pin micro USB connector found on smartphones and tablets.
But Super MHL is different – it is a full-sized connector with 32 pins and matches the data rate of DP 1.3. The CES demo showed a Samsung 8K display being driven through Super MHL. How would anyone fit this on a mobile device? Does it replace HDMI 2.0? (It’s a LOT faster and uses DS compression, too.) So many questions to be answered…
Talk To Me: Conexant showed a demo of voice control for TV set-top boxes (change channels, bring up program guide, set DVR recordings) that was leap years ahead of their demo from 2013. This system works exceptionally well in noisy environments and can be used to control other devices, such as room lighting, thermostats, and security systems.
Conexant is looking to sell their technology as a system on chip (SoC) to a wide cross section of manufacturers. The trick had been reliable speech recognition in all kinds of high and low noise environments, something that doomed Samsung’s voice control TVs back in 2012. It appears they’ve finally pulled it off, but the focus has shifted away from TVs to set-top boxes this time around.
I’ll Be Watching You: The EyeTribe of Denmark showed an amazing eye tracking and control system at ShowStoppers that can operate tablets and phones and costs all of $99. Yep, you read that right! While Tobii’s impressive demos have focused on laptops and gaming systems, EyeTribe has gone after potentially the biggest market for eye tracking. How many times have you wished you could operate your mobile phone while your hands were full?
Faster Video For All: Giraffic had an intriguing demo of optimizing and speeding up video streaming rates over conventional TCP/IP networks. And it had nothing to do with adaptive bitrate streaming, using H.265 encoding, or AVB protocols. What Giraffic is doing is changing the nature and frequency of HTTP requests. This is the best way I can explain it: Imagine you just sat down with a big piece of chocolate cake and want to eat it as quickly as possible. If you take big bites, you’ll be chewing for a while and some pieces may get stuck in your throat.
But if you start with very small bites (like crumbs) and keep shoveling them in quickly, you’ll finish the cake just as fast – or perhaps faster – than the conventional way of eating. And that’s what Giraffic does – it keeps nibbling at the video stream to ensure continuous delivery, even with 4K content. The company claims they can achieve streaming throughput 200% to 300% faster than conventional video streaming, with no freeze-ups and annoying “buffering” warnings.
4K Blu-ray: Okay, we’ve been waiting for this for some time now. And 4K video streaming has already begun at Netflix and Amazon. But Ultra HD BD is finally out of the gate, although you won’t see it until the fourth quarter of this year. Streaming rates will be on the high side of 100 Mb/s with single and dual-layer discs available. (And yes, high dynamic range will be a part of the equation!) Panasonic showed their prototype of an Ultra HD Blu-ray player at the show. The question is; with all the enhancements coming to streaming, does optical disc matter anymore? Time will tell…
Circular LCD Displays: This was a breakout year for oddball sizes of LCDs, particularly in the Sharp booth where automotive displays were shown. (LG Display also exhibited circular and curved LCD displays.) Given the drop in TV prices and Sharp’s ever-dwindling market share in TVs, the market for automotive and transportation displays may be a better bet, long-term. Especially given the company’s leadership in implementing IGZO TFTs, which are important for brighter displays with lower power consumption and higher pixel density.
USB Type-C Connectors: VESA had an excellent demo of this game-changing connector, which has a symmetrical design (no need to worry about which way you’ve plugged it in) and can multiplex DisplayPort 1.3 video with high-speed data. USB 3.1 Type-C is seen as the next generation of USB connectors for mobile and portable devices, and by itself, it can move serial data at 10 Gb/s.
SiBEAM Snap Wireless Connectivity: Silicon Image has revived the SiBEAM name (they bought the company in 2011) and implemented their 60 GHz wireless display connectivity into a close-proximity variant. You simply bring two Snap-equipped devices together (like a smartphone or tablet and a matching cradle), and voila – you’ve established a full bandwidth data and display connection that can run up to 12 Gb/s. Plus, the connector can be used for wireless charging.
SI is showing integrated Snap transmitter and receiver chips that would replace USB 2.0 or 3.0 connections. Clearly, they are also targeting USB interfaces that support DisplayPort 1.3 (see USB 3.1 Type-C) and trying to move away from physical display connections. (This was one argument against using MHL to connect to televisions.) But if they’re successful, what happens to MHL? And now that Super MHL has been shown, what happens to conventional HDMI? Stay tuned..
Super-wide, high resolution desktop monitors: Seems like everybody had one of these at the show. HP, Dell, LG Display, Samsung, and others showed 27-inch widescreen displays with “5K” resolution (5120×2880 pixels). These monitors also support wider color gamuts and use 10-bit panels (a necessity, given all the 10-bit RGB images they’ll be asked to display). What’s surprising is how inexpensive these monitors are – HP’s Z27Q version will be available in March for just $1300.
Toshiba Glass: The jury’s still out on whether Google Glass is a hit or a bust (I’m leaning toward the latter). But Toshiba, who recently retrenched their television operations to Japan, is all-in with a line of enhanced glasses that employ a tiny projection module to show images on the lens surface. This has been tried before – Epson’s Moverio VR glasses have tiny QHD LCD panels embedded in them – and it remains to be seen if the public will buy into the idea. They do look stylish, though. (And there’s even a pair of safety goggles in the line.)
I’ll close out this report with a few passing thoughts. First, it’s impossible to miss the trends of mass-produced, cheap consumer electronics that are increasingly showing up at CES. Next, there is hardly any new technology debuting at the show that multiple manufacturers have in short order (and that includes the Chinese).
Whereas voice recognition was big a few years ago, gesture control took its place the past couple of years. But now that Omek (bought by Intel) and PrimeSense (bought by Apple) are absent from the scene, voice recognition has come back. My new Galaxy 5 phone has Samsung voice on it and it works reasonably well. However, it appears that consumers just haven’t jumped on the gesture recognition bandwagon yet.
Remember 3D? I almost got all the way through this report without mentioning it. A few companies still showed it, such as LG, Toshiba, HP, Hisense, Changhong, Ultra D (digital signage), Panasonic, and some gaming companies. Likewise, Google TV was gone this year, replaced by Android TV in such places as the Sony booth. Aside from program guide searches, I’m not convinced that the average TV viewer needs a Google search engine or Android OS on their TV. But I could be wrong.
Remember drones? I almost managed to skip them as well. There were so many at the show, ranging from behemoths that idled in place overhead while we visited tables at Digital Experience to pocket-sized models with built-in cameras that could zip unobtrusively over a crowd under the control of your smartphone. (I’m waiting for the first pocket-sized EMP generators to appear next year – like electronic bug-zappers.)
Finally, after a day full of press conferences during which there was only about 30 minutes of actual, usable news, I’d like to see a temporary moratorium placed on the words “innovation,” “big data,” “stunning,” “cloud,” “ultra” anything, and in the Chinese booths, “happiness.”
The only thing stunning about Vegas is how expensive cab rides have become. True happiness can only be found at Big Daddy’s Barbecue outside the Central Hall (dee-lish!). “Big Data” should be the name of a blues band, or at least the harmonica player. (Maybe Big Data and The Cloud?)
And I’m sorry, but a floor-mounted pet camera and toothbrushes that sync up to video games are not “innovation.” Cute, yes, but no innovative. (Although the self-powered skateboard I saw that can run up to 16 miles might fall into that category…)
Digital Life Matters; Displays Don’t
- Published on Wednesday, 31 December 2014 17:03
- Ken Werner
- 0 Comments
At least, displays don’t matter as much as they used to. In our era, hardware — including displays — quickly becomes commoditized.
That is not to say you can’t obtain a temporary competititve advantage with a dazzling display: the thin Samsung edge-lit “LED” TV, the Apple Retina, and the ASUS Zenbook NX500’s 4K, quantum-dot-enhanced display, for example. And you can hurt yourself by falling behind the curve. When Apple saddled its iPhones with a ridiculously small 4-inch display for a couple of years longer than it should have, Samsung picked up significant market share. (Apple still plays in a somewhat different universe than the rest of us, so it reaped record-breaking sales with the iPhone 6 simply by catching up with the competition.)
But the business model by which handset companies could maintain large margins by upgrading the hardware a couple of times a year is rapidly losing its effectiveness. Sony is learning how hard it is to make money in the high-end smart-phone business when you’re not in the top four, and Samsung is learning that you can’t maintain margins even when you’re Number One.
On the TV side, we may ogle large 4K (or 8K) screens with quantum dots or OLEDs, but more TV watching is done on small screens than large ones, particularly by the youthful. And even sales of tablets, on which much of this small-screen viewing is done, are stabilizing because mpany consumers see little reason to upgrade.
So what drives the action if hardware doesn’t?
My friend and colleague Richard Windsor (otherwise known as RadioFreeMobile.com), argues convincingly that it is the customer’s “digital life,” and the companies that provide the most compelling of the digital media and services that constitute a user’s digital life are the companies that will prosper. And if a company can make its digital ecosystem sufficiently compelling — or sufficiently difficult to leave — users will spend more and more of their digital life within one digital ecosystem.
Thus, Google and Apple prosper. Microsoft has seen the light and is working hard to expand the digital ecosystem surrounding its Xbox and Windows platforms. (Disclosure: I am not a gamer and do not own an Xbox console, but I am a happy subscriber to Xbox Music. I’m listening to Artie Shaw as I write this. The same user ID and password that get me onto my Windows computer also get me into my Xbox Music account by default. This digital ecosystem stuff is sneaky.)
Google, Windsor tells me, is shrinking the public core of Android and making proprietary more and more of what matters. Thus, it is Google that will control most of the digital ecosystem that is accessed on Android phones, leaving the low-margin hardware to the handset makers. It now becomes easy to see why Samsung is hurting. Apple, of course, controls both its hardware and digital ecosystem, so it is likely to continue to do well even if the margins on its hardware decrease.
Sony is an interesting case. With its Playstation game platform and very successful movie and music divisions, you would think Sony could have been able to establish a compelling digital ecosystem to drive hardware sales. And Sony said it was doing so since the days when Howard Stringer was CEO. But the game division, although successful, stood more or less apart, as did the media divisions. And the phones ran Android, and the computers (while they lasted) ran Windows. How could these devices access Sony music and movies any better than competing products? Well, they could have, just as subscribers to Amazon Prime are given preferred access to a wide variety of music and movies, but Sony never seemed able to put that together.
So we are now in the era of digital life. The display – and the device in which it sits – is the window to that life. The window must be large enough and clear, but it is the life beyond the window for which users are willing to pay.
CES: The Chinese Electronics Show?
- Published on Friday, 19 December 2014 18:42
- Pete Putman
- 0 Comments
In just a few weeks, I’m off to the International CES, or Consumer Electronics Show, in Las Vegas. CES is one of the world’s largest conventions and last year’s event attracted over 140,000 visitors, according to official CES PR.
I’m not sure how true that was – severe winter weather caused all kinds of flight cancellations in the Midwest and some folks never made it out in time. Still, “the joint was jumpin’!” as Fats Waller used to say. The aisles were certainly packed full of attendees and there were plenty of exhibits to take up my 3.5 days in Vegas.
One thing really stuck out this year. In recent years, more and more Chinese CE brands have been expanding their booth space, but this year featured some booths that were as large if not larger than those of more established Japanese brands like Toshiba, Panasonic, and Sharp.
Microsoft, who used to exhibit at the show, pulled out for 2013 and ceded their booth to Hisense, an industrial manufacturing giant in China. In 2014, the enormous Hisense booth featured TVs in all sizes and resolutions (including 4K), major appliances, computing products, and demonstrations of gesture and voice control.
Behind the LG booth, Changhong and Konka had large booths. The Changhong booth had a miniature city created in detail as the centerpiece of an exhibit of televisions and appliances. One of the latter featured a contemporary multi-range stove/oven combination with built-in LCD TV. In another section of the booth, Changhong showed a simple gesture control system, using a game of virtual darts.
Konka’s booth was distinguished by quantities of 2K and 4K TVs using both LCD and OLED technology. Curved televisions were quite the newsmaker in the Samsung and LG booths last January, but Konka had a few of them, too.
So did TCL, another Chinese conglomerate that manufactures RCA and Sanyo TVs sold in the United States. (They license the Sanyo name from Panasonic.) In addition to OLED and curved LCD displays, TCL showed a 110-inch behemoth with finger-tip gesture control and TVs with Roku functionality built-in.
Other Chinese brands that made the trek to Nevada included Haier (everything from televisions to microwaves and washer/dryer combos), China National Corporation (CNC, again a player in entertainment and white goods) and Skyworth, who showed a full range of TVs; flat and curved.
None of these companies was even on anyone’s radar a decade ago. (Well, maybe a few importers.) But the rise of Chinese manufacturing has led to unprecedented drops in the prices of consumer goods.
A good example would be the LCD TV market. A year ago, Chinese manufacturers determined that gearing up for Ultra HD TV production was a smarter move than chasing such high-priced exotic technologies like OLED TVs. Not surprisingly, they captured considerable domestic TV market share from CE giants Samsung and LG by doing so.
Now, we have multiple sources for various sizes of 4K LCD glass coming out of China, and the pricing we’re seeing on Ultra HD sets through December reflects the impact these 4K panels have had. It wasn’t difficult at all to buy a 55-inch 4K TV for less than $1,000, a price point that last year would buy you a 55-inch 2K TV.
Vizio, a major player in consumer TV, brought out a line of 4K TVs in September and by late November had implemented major discounts. Their P-series 65-inch Ultra HDTV had a list price of about $2,200 when it was announced in January, yet several brick-and-mortar retails stores had it for $1,500 with a bonus soundbar around Black Friday.
It might surprise you to find out just how many electronic devices are manufactured in China, from iPads and iPhones to Android tablets and phones, televisions, so-called wearable fitness electronics like wrist heart monitors, headphones and earbuds, and a plethora of wireless gadgets.
I was initially taken aback to see a large booth in the lower South Hall featuring a full range of commercial AV HDMI matrix switchers, distribution amplifiers, and signal format converters, manufactured by Shiny Bow, an obscure Chinese brand. Then I thought, “Why not? A lot of the stuff we use every day in commercial installs is made in China or at least assembled stateside from components and parts manufactured in China.”
The 110-inch LCD TV I mentioned earlier actually comes from a factory in the province of Shenzen, China, and is a joint venture between Samsung, TCL, and the local government that is formally known as China Star Optoelectronic Technologies, or CSOT. (Samsung also makes a TV that uses this large LCD panel.)
I think you get the point: China Inc. is becoming a serious player in consumer (and commercial) electronics, and their expanding booths at CES drive the point home. In contrast, some of the brands whose booths used to dominate the Central Hall are shrinking, like Panasonic, Sharp, and Toshiba. (Mitsubishi is gone completely and Hitachi showed more commercial products than consumer last January.)
Given the growing market share of China in CE manufacturing and their ever-larger booths at trade shows, maybe referring to CES as the “Chinese Electronics Show” isn’t as facetious as it sounds…
Best Buy’s Bharp TV: Turkey Most Foul
- Published on Saturday, 06 December 2014 15:15
- Ken Werner
- 0 Comments
The fourth Thursday in November was Thanksgiving in the United States, as it has been since Abraham Lincoln made it so in 1863. This quintessentially American celebration was created as a national holiday not by Act of Congress but by Presidential Proclamation, which is worth pondering given our current debate concerning the proper limits of presidential power.
Politics aside, Thanksgiving is the day on which we travel long distances to have overly large family dinners with people we don’t like. The traditional main dish is roast turkey, and turkey is also our slang term for a fool or failure — as in, “It’s hard to fly with the eagles when I’m stuck down here with all these turkeys.”
Sitting down with strange companions to consume a turkey describes the agreement Sharp has made to license its brand to Best Buy “for use on an exclusive line of LED TVs that the retailer is direct-sourcing elsewhere,” as Gret Tarr and Alan Wolf described it in TWICE.
This may be foul for Sharp, but it may be filet mignon for Best Buy (BB). After all, the retailer gets to slap a tier-one label on low-end TVs, while Sharp gets to devalue its brand. Can the the Japanese manufacturer possibly make enough money from this deal to compensate for the brand devaluation?
There is a kinder way to parse this deal. My friend and colleague Pete Putman sees it this way: “This is what Sony should be doing for 2K TVs, instead of manufacturing/distribution/marketing/advertising. So far, that has been a money losing proposition.” In other words, Sharp gets to make its high-end, large-screen TVs, on which it may actually make some money, and at least gets to make something as it off-loads the small-screen, low-resolution cheapy business.
Whether you choose to look at this from my perspective or from Pete’s, the deal still leaves BB with the interesting problem of differentiating its Sharp-branded sets — initially 32-, 42-, and 50-inch 2K sets currently selling for $200, $330, and $430 — from its house Insignia brand. And Sharp has to differentiate the cheapies from Sharp’s AQUOS line of premium small and mid-sized sets. Your heart has to go out to Jim Sanduski (acting president of Sharp Electronics Marketing Company of America and Senior VP for product marketing) as he tries to dance on this tightrope.
As Sanduski put it in an email to Tarr and Wolf, the TVs are being produced to Sharp’s “exacting quality standards” and are separate from, though complementary to, the Sharp Aquos line of small- and mid-sized premium LED TVs. Quoting Tarr and Wolf, “Sanduski said his company is involved in the Best Buy program end-to-end, from developing the models and ensuring they meet Sharp’s quality requirements to creating in-store and online marketing materials to support them.” And, “Sanduski emphasized that Sharp remains fully committed to the open Aquos line and its national and key regional customers, including Amazon.com, hhgregg, P.C. Richard & Son, Sears and other dominant dealers.” Sanduski added that the products are produced specifically for Best Buy’s Sharp line and “are not simply rebranded Insignia products.” You see Sanduski’s problem.
Now, Jim Sanduski is a complete pro and I genuinely sympathize with the marketing problem he faces. In his comments, Sanduski simultaneously tries to protect Sharp’s brand value, assure BB customers that BB Sharp (Bharp) bare-bones TV sets sets will somehow be better than Insignia bare-bones TV sets, and assure his key customers for premium sets that they still have Sharp’s full support.
If that’s not a rotten turkey Sanduski was given to eat this Thanksgiving, I don’t know what is.