Samsung Buys Sony's Stake In LCD Joint Venture

First time accepted submitter rtoz writes "Samsung Electronics has decided to buy out Sony's entire stake in their Liquid Crystal Display (LCD) joint venture. S-LCD Samsung will pay Sony 1.08 trillion won ($939m; £600m) in cash for Sony's entire stake (50% – 1 shares) in S-LCD Corp., a venture formed in 2004 to make TV panels. After acquisition, Samsung Electronics' stake in S-LCD will be 100%. The move comes as Sony has been restructuring its TV business, which has been making a loss for the past seven years."

Comments

ONE WHAT

[Anonymous Coward]

wholly mollllly thats a lot a kraft dinner.....

How did Apple miss out on this

[bogaboga]

Surely, this business would have made business sense for Apple. How did they miss out?

On the other hand, I blame SONY for the woes they are facing in today's electronics market.

Nickel and dimming customers together with hardware that would not work properly with non Sony peripherals robbed them of all potential customers, myself included. Sony thought they were everywhere all the time. Watch out Samsung because I also see Sony traits in you.

Re:How did Apple miss out on this

[gl4ss]

Surely, this business would have made business sense for Apple. How did they miss out?

On the other hand, I blame SONY for the woes they are facing in today's electronics market.

Nickel and dimming customers together with hardware that would not work properly with non Sony peripherals robbed them of all potential customers, myself included. Sony thought they were everywhere all the time. Watch out Samsung because I also see Sony traits in you.

how did they miss out?

SINCE WHEN DO YOU FUCKING THINK APPLE WANTS FACTORIES??!?!?!?!!?!??!

-sincerely, some guy on the coach. but it's true. apple doesn't want factories. or such.

Re:How did Apple miss out on this

[smi.james.th]

Samsung and Apple aren't exactly on good terms at the moment, and if Apple had bought Sony out they would have to play nicely with Samsung.

FWIW, I like Samsung TVs, I have one.

Re:How did Apple miss out on this

[Anonymous Coward]

"dimming"? You're dim.

Re:How did Apple miss out on this

[blackraven14250]

Why'd they buy that Israeli flash manufacturer a couple weeks ago, then?

Re:How did Apple miss out on this

[oldhack]

I think Sony's troubles all trace back to buying into Hollywood. Instead of "synergy", lawyer/lobbyists-infested Hollywood ruined what was once a proud corporate icon.

Funny, "corporate" today sounds dirty, and I am not even a lefty.

Re:How did Apple miss out on this

[thegarbz]

Apple isn't a manufacturing company. They are a design and trademark company. Their prize employees are artists and lawyers, with the engineers bearing the sometimes unreasonable design demands.

LCD manufacturing is a completely different beast. There is no design, there is only R&D and production. Make the display thinner, better contrast, better colour gamut, better viewing angle .... etc, and then manufacture it to the size the customer requires it.

In the business world you stick to what you know best. Many business have branched out into other areas or even just the same areas in another country and tried to control new sources of their supply chain without any experiences and have crashed and burned as a result. This is not something that would benefit Apple, not when they could just have the lawyers negotiate an purchasing the product at almost cost from a capable manufacturer.

Re:How did Apple miss out on this

[gl4ss]

from what I could find out, anobit designs flash systems and has a big bunch of patents.
for example one of their products uses consumer grade flash chips... so figure it out. it certainly doesn't look like they're actually producing things - you know, real material things, buying copper and rocks and turning them into something.

"Anobit's products are used by world leading flash manufacturers, consumer electronics vendors and storage system providers.".

nowhere are they saying that they'd have a chip fab of their own..

Screens aren't trendy any longer.

[Anonymous Coward]

Maybe you haven't heard. Screens aren't trendy any longer. They're not cool. They're not hip. They're obsolete.

Just look at an average smart phone today. Look how much space is taken up by the screen. That's wasteful. That needs to go!

The next generation of smart phones will be so much more trendy, hip and cool. They won't have screens at all.

Since Apple's always ahead of the game, I think they'll be the first to market. The phone will be just big enough to have an Apple logo stuck on the back. Yeah, you can't use it to make calls, or play games, or send text messages. But that doesn't matter. It has an Apple logo on it. That's all you need to know before you'll throw down a few hundred bucks for it.

Re:Screens aren't trendy any longer.

[Anonymous Coward]

You know, if I thought Apple had perfected either holographic projection technology, à la R2D2, or some sort of HUD display on sunglasses, I'd actually believe your sarcasm was the honest truth. Especially the holographic part: if it sounds like something off Buck Rogers, it belongs on a Steve Jobs product.

So what determines quality?

[Pagey123]

Forgive my ignorance, but I've never followed the LCD and/or HDTV market closely, so these may be silly questions with obvious answers. I will assume (correct me if I am wrong) that there's some consolidation in the LCD TV industry and that most "manufacturers" get their panels from only a handful of sources. If that is in fact the case, what variables actually go into determining the quality of a unit? For example, I've read several "rumors" that Samsung once upon a time had a ton of bad caps on some model(s) that gave consumers a lot of grief. Just curious, so thanks for the insight!

Re:So what determines quality?

[kyrio]

1) You talk to the manufacturer about what you want it to do and the price point for manufacturing. They build your device and you sell it with your branding on it.

2) You talk to someone who had a manufacturer make a product for them. You tell them your price point and they rebrand some stock for you.

3) You are a manufacturer and you've decided to make a product of your own. You decide on a price point and hope your product is accepted over everyone else.

With the above information you can help yourself buy an identical (or superior) product at a lower cost by finding out that your Somy or Tobisha product is actually made by Samyung, and it just so happens that the Samyung costs 20% less than its competitors. This is extremely evident in PSUs (power supply units, look it up) and products like Apple PCs (that are made by Foxconn).

Of course, not all manufacturers sell competing products and even if they do, that doesn't necessarily mean they compete at the same level as the companies they manufacture for. An example would be "Gaming" PSU products being manufactured for a company but the manufacturer only sells server grade power supplies or "non-gaming" power supplies. Another one would be a budget product dealer's products being manufactured by a manufacturer that only sells high grade products under its brand.

After knowing all of this, there could also be a situation where the manufacturer has other child businesses to sell lower grade products or products that require a different image (one for gaming, one for shit that blows up, one for server stuff). This helps them keep the public's opinion focused on the brand of the product they bought, instead of the manufacturer and the manufacturer's other products.

Coming back to LCD TVs and monitors, you essentially have a very small amount of manufacturers making products to spec for a wide range of markets, mostly for other companies. Since the public is mentally challenged, the market is becoming more focused on shit products and mass production of low quality TN panels for the lowest price possible. At this point, it's hard to find a good quality (or I should say, higher quality) product without paying a fortune for it. Other than Sony's hideous method of displaying their pixels, every other display is essentially the same. The only differences come down to how much of a profit each company wants to make from their sales and how much their brand's image is worth (how long they plan to use that brand before closing down and opening again with a new name).

Foxconn Labor + Samsung Patent = Sony Odd Man Out

[retroworks]

Samsung has an Intel-like proprietary stake with many of the boards used in LCD and plasma production, and everyone is using Foxconn factories to assemble and produce. Sony is a major brand value but trying to keep ownership of actual LCD display production was an expensive gamble. Hopefully they put some of the trillion into R&D. Their mhttp://slashdot.org/story/11/12/26/1238225/samsung-buys-sonys-stake-in-lcd-joint-venture#ove to make content (Sony Pictures and Playstation games) was a better investment than hardware.

Re:Foxconn Labor + Samsung Patent = Sony Odd Man O

[retroworks]

Whoa, copy paste error. Ahem, I said their investment into content (Sony Pictures and Playstation games) has been better to stockholders than their hardware business.

Interesting how the "big picture" has unfolded

[theskipper]

This news, coupled with the fact that Samsung controls 95% of the rapidly accelerating AMOLED panel market, puts them in a dominant position for display panels in general.

For years Samsung played the "ant" by investing heavily into new production plants for AMOLED when the technology was uncertain. While LG, AUO and Sony acted as the "grasshopper", flip-flopping in their commitment to future investment (documented on oled-info.com back to 2006).

Now AMOLED is in a huge number of phones and actual production TVs will be appearing at the upcoming CES (with OLED lighting in a couple years). So Samsung can retrofit the dying, low-margin LCD business by integrating hybrid OLED backlit modules. That will provide competition to LG's upcoming "fake" OLED TV (OLED backlit only), while Samsung's "true" OLED TV (actual OLED pixels) business will have little competition when they release it.

Lastly, not only did Samsung have the foresight to invest billions in capex for the replacement technology, they also locked up a multi year (non-exclusive) contract with the fundamental IP and materials provider for PHOLED (Universal Display Corp). LG and AUO are still twiddling their thumbs with 3-6 month contracts with UDC. This extends to the general lighting market too, as PHOLED will be required because of efficiency.

Is it a good thing for one company too become so powerful in a single segment? Never. But when the competition is weak and near-sighted, this is inevitable outcome. Jmho.

Re:Interesting how the "big picture" has unfolded

[bill_mcgonigle]

So Samsung can retrofit the dying, low-margin LCD business

This has to be the main driver. I finally picked up an HDTV for the family for Christmas. I previously had a 27" CRT that I just couldn't get parts for any longer. I've long kept an eye on the LCD and plasma sets, but the picture never looked good enough to me to replace the CRT quality until a year or two ago.

I went to the warehouse club and compared TV's from $200 to $2500. There was large variation between brands (Samsung and Vizio had the nicest pictures IMO) and in the end I settled on a $400 37" 120Hz Vizio.

In inflation adjusted terms, that CRT cost $2500. Aside from a bit worse blacks (but I so rarely watch TV anymore...), this $400 set is equal or better in every way. I'm told many of them don't last beyond 5 years. But look at the price differences - I'm paying the same $/yr, not counting electricity.

Anyway, point being, this TV is a ridiculously good value. Compared with other products on the market, I can't see how they're making much money at all on this product.

The real trick, though, is going to be to get me to spend more than $400 on my next TV. If they get massive roll-to-roll OLED working, they can attack the cost structure, and if they can make those sets for $50 I'll still pay $400 for the next one, so they should see decent profitability again.

Oh, and thank-you capitalism for a nice $400 TV.

Re:Interesting how the "big picture" has unfolded

[Osgeld]

"Oh, and thank-you capitalism for a nice $400 TV"

or a 200$ computer monitor with headphone speakers built in

your welcome

Re:Interesting how the "big picture" has unfolded

[Guppy]

This extends to the general lighting market too, as PHOLED will be required because of efficiency.

I wonder if PHOLED efficiency will result in a longevity advantage too, if the wasted energy in OLEDs contributes to its degradation?

Re:Interesting how the "big picture" has unfolded

[bill_mcgonigle]

or a 200$ computer monitor with headphone speakers built in

Oh, gosh, I probably spend a similar inflation-adjusted $2500 for a 17" Trinitron monitor.

Re:Interesting how the "big picture" has unfolded

[theskipper]

From my layman's understanding, yes, but how much of a real world effect it is vs. a polymer based device, I don't know. In general though, the three factors related to drive current+lifetime that come to mind are 1) good emitter outcoupling, 2) the fact that OLED is dimmable and 3) OLED is color tunable.

The internal quantum efficiency (IQE) for PHOLED is always going to be 100% as opposed to (much less) for fluorescent OLED. The external quantum efficiency (EQE) factors in outcoupling. So the more light reflected out of the device, the less energy required in the future vs. current benchmarks.

For dimmability and lifetime, the drive current can be reduced (which with OLED retains/increases it's efficiency).

Since OLED is color tunable, white oled fixtures can be biased for more higher-lifetime red and green when CRI is not so important. For display, it just means biasing the UI towards red and green usage since all white is a problem (i.e. minimizing blue).

If you're curious, see these three easy-reading links for info on the power issues, materials specs, and an outline presentation of how things are looking for lighting. Lighting will be different in terms of efficacy, structure, CRI, etc. But from a materials standpoint, there's still good info that can be extrapolated to displays wrt PHOLED efficiency and degradation:

http://www.universaldisplay.com/default.asp?contentID=605
http://www.universaldisplay.com/default.asp?contentID=604
http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/pattison_oled_sslmiw2011.pdf

Trillion?

[Anonymous Coward]

Either the exchange rate between British pounds and US dollars has gone up a couple orders of magnitude overnight or someone needs to double check what name is used for 1000 x 1 million. Two 9 figure numbers don't add up to a 13 figure number, ever. Editors, where were you on that one?

Re:Trillion?

[kyrio]

What the fuck are you going on about? The only error with conversion is rounding the GBP to 600 from 602.6.

Sony TV business a loss?

[MMC Monster]

Good!

My dad was a Sony only guy from the early 70s onwards. Until I was old enough for him to take my tech advice seriously and Sony earned my contempt more than a decade ago.

So now my dad buys the best non-Sony entertainment units (TV, blu ray, receiver, etc.) he can find (I basically choose his devices for him), and I do the same. And I encourage my friends similarly.

And on the media side of things, I do buy DVDs... But I donate them all to the local libraries as soon as I feel I'm not going to watch them anymore.

I know I'm not making much of a difference, but it's about all I can do.

Are you doing your part?

Re:Sony TV business a loss?

[Anonymous Coward]

What a worthless little troll you are.

Re:Sony TV business a loss?

[Anonymous Coward]

I talked someone out of buying a Sony camcorder this morning (they had it down to two cameras, similar price point, similar reviews - just needed a flip of the coin so me saying "I fucking hate Sony they like to sue people like me" was enough to make that pick for them) and bought an LG tv rather than a Sony Bravia.

A lot of companies seem to be short sighted when thinking about their consumer base. Sony will never directly see another penny from me. I don't buy their music, I don't buy their movies, and I don't buy there hardware (I might pick up a ps3 used in a couple years.. but everytime I think about it I feel like I'm being a hypocrite). I know I'm not buying from GoDaddy ever again, and I will be actively encouraging people to buy SSL certs elsewhere when asked.

Re:Sony TV business a loss?

[In hydraulis]

Serious question:

Are you aware of any mirrorless camera, available now or in the near future, that can give the coming Sony NEX-7 a run for its money?

I see nothing on the horizon.

Re:Sony TV business a loss?

[ADRA]

Flip that coin one more time. If Sony Was somehow godstruck and began acting like a responsible consumer driven company, would you still ever support them? It seems silly to have a decade old grudge over a company who's executives are most likely working for their competitors now. Now I don't know for sure if Sony's really wised up over their retarded past mistakes, but I find it silly that people get so emotional over a nebulous blob of an entity with so many working parts, anything could jade one. Customer Support is a big one. One bad disgruntled rep could stale the relationship with otherwise loyal customers forever.

Re:Sony TV business a loss?

[Anonymous Coward]

The most expensive TV I've every bought was a Sony rear projection in about 2007-2008 for over $2500. Right after the 3 year extended warranty was up, it died (The infamous optical block problem - in my case seemed to lose control over green color). Sony never fixed the issue but instead, for about 1/2 price of what Best buy is asking, is offering me a replacement TV. Problem is, leading up to Christmas, having an unexpected $1000 bill is well, inconvenient. Fortunately I have one of those money trees out back.
So my most expensive TV lasted the shortest period of time.
So much for Sony quality.

The world is changing fast

[arnhem]

Not long time ago, Japaneses tended to think Koreans as an inferior race. Now Sony is losing its markets to Samsung/LG. Not long time ago, Caucasians tended to think Asians as an inferior race. Now ...

Re:The world is changing fast

[Anonymous Coward]

Asians, an inferior race? Holy crap have you ever looked at their women?

Re:The world is changing fast

[geminidomino]

Holy crap have you ever looked at their women?

Every chance I get. ;)

Re:Foxconn Labor + Samsung Patent = Sony Odd Man O

[sonicmerlin]

It also means Sony's giving up on competing with "Apple TV", while Samsung's gearing up to rip off Apple yet again.

I might

[Anonymous Coward]

I would love to buy a product from a don't be evil Sony. I would love to buy a product from a don't be evil MicroSoft. Neither one has showed me any semblance of seeing the light. Sony kicking Linux off the PS3 and the fact that MicroSoft has been a barrier to innovation are both more recent than the last ten years. The best thing I can say about either is that I have not noticed recently where Sony prosecuting copyrights for what is obviously other peoples work or fair use.

Interesting times

[NTT]

So they sell their hard drive business to seagate and buy out Sony tv.
Curious.

http://hardware.slashdot.org/story/11/04/19/139259/samsung-hd-unit-bought-by-seagate