Quote Originally Posted by Smokey View Post
Wooch, the article has not been editorialized. Here is the full lnk from Bloomberg...

Vizio Aims Low-Price Wrecking Ball at PCs After Shaking Up TVs - Businessweek
See, this is why I wanted to see the link to the original article. The two examples that the article cited were Pioneer and Philips, both of which are poor examples to support the whole "wrecking ball" premise of the article. I wanted to see if there was anything in the original article that could actually redeem itself. Unfortunately, it was all just more lamebrained writing that's too typical of what passes for analysis in the tech press.

First, Pioneer was a low volume high end plasma TV manufacturer. (and no, Vizio is not a manufacturer) It wasn't Vizio that drove Pioneer out of the TV market -- it was Panasonic, Samsung, and LG (i.e, other manufacturers) that competed in the plasma TV market with far more efficient manufacturing processes, and were catching up to Pioneer in picture quality.

In the case of Philips, the article is factually inaccurate because Philips still sells TVs under its name. They ceded the North American market years ago, and outsourced its TV manufacturing in this market to Funai. Philips exited the OEM LCD panel market in 2008, but again, that has nothing to do with Vizio because they are not an OEM vendor.

Quote Originally Posted by Smokey
As it was mentioned the pricing on their new venue products has not been announced, so have to wait to see how they compare with its peers. There seems to be not as fierce competition in PC market as it is in labtop market.
The competition in the PC market drained the margins to commodity status well before the same thing occurred with laptops.

For whatever reason, the tech press has this fascination with Vizio, even though they are untested in other markets and the set of conditions that fueled their growth in the TV market don't exist with PCs.

First off, the HDTV market still had high margins when Vizio entered. They had a lot of space that they could use to undercut the competition. There's no such margin in the PC market, which has been languishing at commodity levels for years.

Right now, Apple is the only PC maker that maintains high margins with PCs, and that's because of how they manage their supply chain. Apple pays its OEM vendors cash up front, and will front the capital expenses for plant expansions with their contract manufacturers. In exchange, they get guaranteed supply and a low unit price. The volumes that they generate with their iOS devices share common components with their Macs, which gives Apple a cost structure that no one else in the industry can match. Everybody else is a box builder using parts procured on the commodity markets. Margins are already thin, and Vizio does not have the volume to undercut competitors in the PC market.

And this is not their first foray into the PC market. To much fanfare at CES, Vizio announced last year that they would enter the tablet PC market and the tech press lapped it all up. Well, Vizio's tablet didn't come out until August and it has already been clearance priced down to around $200, as competitors engaged in a price war. The Vizio tablet is "out of stock" on their website, and I have not heard anything about a new model coming out.

The only PC market segments where there are some margins remaining are with all-in-one PCs and ultrabooks. That might be where Vizio is focused, but again, they are trying to compete as a virtual company, where competitors in the PC market are already heavily outsourced.