The Tiny Global World
Japan led the CE world for decades, taking that role away from the United States. It’s true, no televisions are made in the U.S. anymore (though many are assembled in Mexico, and there are hints of some assembly coming back to America). However, this isn’t to say that the U.S. is just a mere consumer of electronics. Much of the technological design work goes on here. Universal Display Corp, based in Trenton, NJ, is a major player in the development of Organic Light Emitting Diodes (OLED), which promises to be the next generation of televisions. QD Vision, based in Lexington, MA, have developed quantum dots, a new LCD backlight technology. The company is also working on a display that only uses quantum dots, possibly rivaling OLED in thinness and performance. Then there’s Analog Devices, AMD, Texas Instruments, Intel, Qualcomm, Silicon Image, and others. In fact, of the top ten semiconductor companies, half are American. An American company often designs the pieces that make your TV work, beyond the screen itself.
This shift away from manufacturing and a focus on design and engineering is already happening in Japan. Sony designs TVs, but other companies manufacture them. Other big brands do the same for many of their low-end models.
There is no doubt China already is an incredibly important player in the global electronics market. Japan, for a multitude of reasons, is not as important a player as it was. Like the United States, though, this isn’t to say Japan is not important. What we’re seeing, perhaps, is a true globalization of the electronics world. Like the bits and bytes that travel at light speed around the world, perhaps the future we’ll see is one of no country being the dominant force. Instead, multiple countries offer a different aspect to the overall CE zeitgeist. As products get too expensive to manufacture in China, who knows what new countries will get manufacturing next. Already we’re seeing manufacturing in Vietnam, Malaysia, and the Philippines. Some think the next step is Africa.
Televisions themselves are becoming less important as well, with tablets and smartphones taking a sizeable chunk of everyone’s discretionary budget. The history of consumer electronics may have followed the television, but the future will follow portable. Here, perhaps, we can see a glimpse of that future in Apple: Designing products in the United States, but using component suppliers from all over the world, with final assembly in China.
From RCA to Sony and from Sony to Samsung, no company stays at the top forever. Staying at the cutting edge of technology and product design is key. RCA led the world in televisions until Sony’s Trinitron leaped past. Samsung’s investment in manufacturing established the company as a leader in flat panel TVs, and its focus on design propelled them to the top.
While killer products are vital, but so are external factors. There’s little question government policies aided RCA, Sony, and Samsung’s success. RCA’s start as a “marriage of convenience” between government and private interests gave it a jumpstart in the burgeoning radio industry. Sony’s keiretsu ties, along with strong pro-trade government policies, helped the company launch onto the global market. Samsung’s chaebols established a massive and powerful base to build a global corporate empire. China’s government and its recent pro-business push has let many companies there compete on the world stage. Will these policies continue to assist Chinese companies, or instead will we see further movement towards true, widespread globalization?
“Over the past 40 years, we’ve seen a shift in TV market leadership from Japanese brands in 1990s, to Korean brands in 2000s,” says Steve Koenig, Director of Industry Analysis at the Consumer Electronics Association. “Today, we are seeing the rise of Chinese brands like Vizio, Hisense and Haier.”
Only time will tell if the market is just getting more global, or specifically getting more China. If history is any indication, that too will just be a trend in the pixels and phosphors of time.
Special thanks to Tamaryn Pratt at Quixel Research for help with specific unit sales data and overall trends for this article.
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