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To be fair everyone is being eclipsed by Apple at the moment. The article is right that the CE market (at least for the established product categories) is bruta

To be fair everyone is being eclipsed by Apple at the moment. The article is right that the CE market (at least for the established product categories) is brutally competitive and the strong yen has been crippling for companies. It looks like it is down by more than 20% against the dollar[0] fairly recently which will give Sony and the others a chance to compete again. Apple hasn't been the biggest problem for Sony and the Japanese companies it has been the Koreans (Samsung mostly but also LG) who have reached a high quality level, with local affordable labour so that the designers can be close to manufacturing for better production development cooperation. The Won seems to be pegged to the dollar (it looks like it has been allowed to rise 10% recently)[1] so the fall of the Yen could bring the Japanese companies back into the game. The interesting question is when/whether the Chinese brands will become serious players in the major CE markets such as TV and whether they will replace the Korean brands as the Koreans replaced the Japanese. [0] http://finance.yahoo.com/echarts?s=JPYUSD=X http://finance.yahoo.com/echarts?s=JPYUSD=X [1] http://finance.yahoo.com/echarts?s=KRWUSD=X http://finance.yahoo.com/echarts?s=KRWUSD=X [2] http://blog.jtl.me.uk/sonys-decline http://blog.jtl.me.uk/sonys-decline - Old blog post based on HN comment a couple of years ago that still holds up reasonably well. Disclaimer: Ex-Sony employee (left about 3 years ago) who still recommends their products at least in the TV category.

bane 12y ago
I think you're right on. In the home electronics and appliances space, Apple offers very few items. The direct competition now is between Korean and Japanese makers. I've noticed some price creep in Korean goods now that they've elbowed Japanese products largely out of the American market. It almost seem strange these days to see a TV in the U.S. that's not a Samsung or an LG. I also agree that the Chinese made products may challenge this current status, but Chinese products have very serious quality issues that may turn a purchase into a one-time thing instead of a repeated customer. Samsung is synonymous now with quality products. It's surprising they haven't made more of a play in the videogame market. Until the Japanese import ban was dropped a few years ago, Samsung licensed, built, marketed and sold Japanese video games under local names like Super Gam*Boy (Genesis/Megadrive) -- Hyundai got the Nintendo Consoles each with similarly different names. Also, Korea is pushing hard on design right now. The effects are mixed, but they're trying to break out of a pure copy-the-hot-design mentality right now. Chinese manufacturing is still very much in the copy-the-design mode vs. new design. But the effort is there: https://en.wikipedia.org/wiki/Dongdaemun_Design_Plaza https://en.wikipedia.org/wiki/Dongdaemun_Design_Plaza Japan is still King of design right now among the three countries, able to bring about completely new products from whole-cloth at I think a higher level of quality and finish. But I'd say in 5-10 years the difference between Korean and Japanese output will be negligible. I don't think the Won is pegged anymore to the dollar (I think that ended in the late 90s), but their largest trading partners either are closely pegged (China) or have very large trade relationships with the U.S. The Won is kind of like the Yen, relatively stable at around 1,000 Won to the Dollar and the Yen tends to be around 100 Yen to the dollar. At least it makes price comparisons easy when traveling!
- josephlord 12y ago
  > I also agree that the Chinese made products may challenge this current status, but Chinese products have very serious quality issues that may turn a purchase into a one-time thing instead of a repeated customer. Samsung is synonymous now with quality products. People said this about the US when the UK was centre of the industrial world, about Japan when the US was dominant, Korea when Japan was dominant. Looking just at the current state without that history I would agree with you. The Won peg was just my assumption looking at the price exchange rate chart on Yahoo but maybe it was just a lack of precision, xe.com[0] seems much more accurate and shows a more normal looking graph. [0] http://www.xe.com/currencycharts/?from=USD&to=KRW http://www.xe.com/currencycharts/?from=USD&to=KRW
  - dageshi 12y ago
    In terms of China becoming the next big "competition" you may well be right. The one thing I would say is that China has such a large and growing internal market that many Chinese manufacturers may see it as being far easier to concentrate on the domestic market which they understand than an international market which they don't. Given that, it might take a lot longer for those Chinese brands to attempt to crack the international markets than you might think.
    - bane 12y ago
      Yeah, I agree with this as well. I think cars are a useful thing to look at. The Korean market went international relatively quickly once they started making cars because the domestic market is relatively small (even with lots of trade protectionism keeping foreign competitors out). The Chinese market is robust, but pretty much entirely internal at the moment. Still, the Chinese market has shown that there's lots of talent out there able to build all kinds of things. We'll see how long it takes for the domestic markets to mature enough to put pressure on manufacturers to go global. Overcoming the public perception of decades (generations even) of exporting essentially crap products will take a while.
Tloewald 12y ago
All very good points. I suspect that Chinese brands will do to the Japanese what the Japanese did to Americans and Europeans. In some cases, they will take shortcuts to gain brand recognition early (e.g. Lenovo buying IBM's ThinkPad business).

bane 12y ago

I think you're right on. In the home electronics and appliances space, Apple offers very few items. The direct competition now is between Korean and Japanese makers. I've noticed some price creep in Korean goods now that they've elbowed Japanese products largely out of the American market. It almost seem strange these days to see a TV in the U.S. that's not a Samsung or an LG. I also agree that the Chinese made products may challenge this current status, but Chinese products have very serious quality issues that may turn a purchase into a one-time thing instead of a repeated customer. Samsung is synonymous now with quality products. It's surprising they haven't made more of a play in the videogame market. Until the Japanese import ban was dropped a few years ago, Samsung licensed, built, marketed and sold Japanese video games under local names like Super Gam*Boy (Genesis/Megadrive) -- Hyundai got the Nintendo Consoles each with similarly different names. Also, Korea is pushing hard on design right now. The effects are mixed, but they're trying to break out of a pure copy-the-hot-design mentality right now. Chinese manufacturing is still very much in the copy-the-design mode vs. new design. But the effort is there: https://en.wikipedia.org/wiki/Dongdaemun_Design_Plaza https://en.wikipedia.org/wiki/Dongdaemun_Design_Plaza Japan is still King of design right now among the three countries, able to bring about completely new products from whole-cloth at I think a higher level of quality and finish. But I'd say in 5-10 years the difference between Korean and Japanese output will be negligible. I don't think the Won is pegged anymore to the dollar (I think that ended in the late 90s), but their largest trading partners either are closely pegged (China) or have very large trade relationships with the U.S. The Won is kind of like the Yen, relatively stable at around 1,000 Won to the Dollar and the Yen tends to be around 100 Yen to the dollar. At least it makes price comparisons easy when traveling!

josephlord 12y ago
> I also agree that the Chinese made products may challenge this current status, but Chinese products have very serious quality issues that may turn a purchase into a one-time thing instead of a repeated customer. Samsung is synonymous now with quality products. People said this about the US when the UK was centre of the industrial world, about Japan when the US was dominant, Korea when Japan was dominant. Looking just at the current state without that history I would agree with you. The Won peg was just my assumption looking at the price exchange rate chart on Yahoo but maybe it was just a lack of precision, xe.com[0] seems much more accurate and shows a more normal looking graph. [0] http://www.xe.com/currencycharts/?from=USD&to=KRW http://www.xe.com/currencycharts/?from=USD&to=KRW
- dageshi 12y ago
  In terms of China becoming the next big "competition" you may well be right. The one thing I would say is that China has such a large and growing internal market that many Chinese manufacturers may see it as being far easier to concentrate on the domestic market which they understand than an international market which they don't. Given that, it might take a lot longer for those Chinese brands to attempt to crack the international markets than you might think.
  - bane 12y ago
    Yeah, I agree with this as well. I think cars are a useful thing to look at. The Korean market went international relatively quickly once they started making cars because the domestic market is relatively small (even with lots of trade protectionism keeping foreign competitors out). The Chinese market is robust, but pretty much entirely internal at the moment. Still, the Chinese market has shown that there's lots of talent out there able to build all kinds of things. We'll see how long it takes for the domestic markets to mature enough to put pressure on manufacturers to go global. Overcoming the public perception of decades (generations even) of exporting essentially crap products will take a while.

Tloewald 12y ago

All very good points. I suspect that Chinese brands will do to the Japanese what the Japanese did to Americans and Europeans. In some cases, they will take shortcuts to gain brand recognition early (e.g. Lenovo buying IBM's ThinkPad business).