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  • seoulsearch1 seoulsearch1 Jul 7, 2005 10:39 PM Flag

    What does Samsung Know that No one else

    So what does Samsung know that no one else does?
    http://www.digitimes.com/news/a20050707PR202.html

    Certainly, there is some unit growth left in the DSC market; shipments will grow from 84.7 million units in 2005 to 107 million units in 2009, iSuppli predicts. During that time, however, revenues will drop from US$18.3 billion to US$16.4 billion.

    This average selling price (ASP) erosion has already transformed gains into losses for several major Japan-based DSC vendors. Olympus, for example, reported losses for the most recent fiscal year ending March 2005. It also announced massive job cuts in an attempt to bring down costs. And at least one company, Kyocera, has already decided to exit the market entirely.

    Still, some vendors are making gains. Eastman Kodak has leveraged its brand name and printing solutions to gain share, particularly in the US, at the expense of Nikon, Olympus and Fuji Photo Film. Panasonic, which has ties to number-three online photo printing vendor Shutterfly, has also gained share. So has Casio, which was perhaps the only vendor that saw its ASPs increase last year. The company��s unique designs and track record of controlling production volumes appear to be paying off.

    So what advantages does Samsung have?

    Having emerged as a consumer electronics powerhouse, the company certainly has brand and distribution strengths. But perhaps more importantly, Samsung��s vertical integration may enable lower costs and fast product development. In 2005, the company will switch to internal supply for small-size LCDs currently supplied by Sony and Casio. Its newly announced DSC models include relatively large-size screens; the flagship camera features an industry-leading 3.5- inch LCD (Kodak��s delayed EasyShare ONE is the only other DSC with such a large screen). In 2006, Samsung will also begin utilizing its own image sensors instead of buying from Sony and Matsushita. And unlike most of its Japanese DSC rivals, Samsung also has existing relationships with several Taiwanese ODMs.

    The question remains whether Samsung can transform these strengths into a profitable camera business. What doesn��t remain is the question of Samsung��s intent to dominate consumer electronics. Besides DSCs, the company has also launched several MP3 and portable media players to attack Apple Computer in that market. Samsung plans to triple its shipments to five million units in 2005. And earlier this year the company entered into a partnership with Digeo to develop set-top boxes (STBs) and media centers. What��s next, video game consoles? Probably not, but don��t rule it out.

 
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