
Japanese electronics firms: Eclipsed by Apple - e15ctr0n
http://www.economist.com/news/business/21606845-electronics-companies-japan-are-starting-turn-themselves-around-they-are-shadow
======
mrj
Karma.

They aren't the first to learn that they can't keep treating their customers
poorly forever. Customers find alternatives. Word gets around.

I have had a Sony TV with a well-known defect that they continued making for
years, disregarding consumer complaints. The rear 1/3 of the logic board
wasn't supported and the gentlest bump would break it. My very expensive TV
broke and they refused to cover it.

Way back when I used to maintain computers, the Sony Vaio laptops constantly
had their backlights go out. Several different models. Sometimes the
replacements would go out, too.

One time we had tape drives on back order. Some proprietary format that only
Sony had at the time. They took so long to deliver them that we found
alternatives. When they finally came, months late, they came without cables.
It took another several months to get them.

Not to mention the debacle of PSN going down for a month and they wouldn't
admit to me that they lost my credit card number. Recently, all of my game
saves have been corrupted by their auto upload service.

I have regretted choosing Sony. Every. Single. Time.

~~~
jobu
20 years ago I was a huge fan of Sony, but that was when the Sony brand meant
high quality instead of just a high price.

Right now I like Apple devices for many of the same reasons I used to like
Sony (great quality, easy to use, and their products work even better
combined). Hopefully Apple can learn from Sony's mistakes.

------
josephlord
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
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
> 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
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
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.

------
dba7dba
I feel Economist is just bringing Apple into this discussion of the trouble
Japanese electronics firms in order to attract more clicks. Apple makes no TV,
display panel, fridge, DVD player, or dishwasher.

The real reason the Japanese electronic firms are in trouble is not because of
Apple but Samsung/LG. IMO, it's not because Samsung/LG really excelled but
because the Japanese firms stumbled/stagnated.

I remember reading last year or so that during a quarter (or was it a year?)
Samsung's profit was bigger than the profit of top NINE Japanese electronic
firms combined (including Sony). If you knew anything about the bitter history
between the 2 nations, it is pretty astounding.

------
cyorir
Sony's loss of Vaio is a hard pill to swallow for me, since I basically grew
up on Vaio, and may now find myself using Lenovo more since newer Vaios are
not quite what they used to be.

Nevertheless I think that Japan's tech industry has a lot of advantages going
for it. The corporate culture is conservative, but a side effect is that
standards for testing and products released are usually very high. With high-
tech manufacturing Japan has a lead over many competitors for developing
products that fill high-end niches in the industry. Abe's reforms are favoring
Japanese exports, making it easier for international consumers to afford
Japanese products.

Maybe Japan's tech industry is "eclipsed," but do not expect it to go away as
one of the industry's leaders any time soon.

~~~
bitwize
VAIOs have almost always sucked for me: I remember them as being expensive and
polished, but made from custom parts that tended to flake out at the wrong
times and not work with Linux. That said, I bought one of the last Sony
models: a VAIO Duo 11, and it uses, aside from the Memory Stick® reader,
standard Linux-compatible parts, mostly from Intel. It's a nice little machine
and seemed to mark an improvement for Sony. Alas.

------
NickWarner775
Sony has been sliding downhill in terms of quality products for quite some
time now, in addition to ignoring customer feedback/complaints. In my eyes,
this was really only a matter of time. But, by no means do I think Apple is
overshadowing the Japanese tech industry; the innovative and creative nature
of japanese tech products will continue to progress, while I see Apple
beginning to plateau in quality/creativeness after Steve Jobs' passing.

------
bryanlarsen
right-click, open in incognito to read if you hit the paywall.

------
codeulike
Is it fair to say that all of Sony's greatest hits were hardware based,
especially things with moving parts (Walkman etc), and that they aren't so
great with Software? These days, when the parts of (say) an android phone can
be sourced from a multitude of places, software is the much greater
differentiator.

