Samsung and LG have been dominating the TV market for a number of years now by undercutting the traditional Japanese powerhouses of Sony and Panasonic but it has now emerged that Samsung is also feeling the pinch with its LCD TV division making a loss of £565 million in 2011.
Demand for TVs globally has weakened in the past 12 month and combined with rising cut price competition from China, we've seen all traditional TV powerhouses suffer poor sales.
Samsung is leading the way (along with LG) with OLED technology which is seen as the future of TV technology and reports today suggest that Samsung may be considering selling off its loss-making LCD business to concentrate on its OLED production.
These reports emerged from South Korean newspaper, Chosun IIbo, though without quoting any source for the information. Another possibility, cited by Reuters, which would see Samsung merge the more profitable OLED business with its LCD operation and convert part of LCD production capacity into OLED manufacturing lines.
This would seem to make more sense as LCD panels will still be in demand for a number of years to come, until OLED technology becomes suitably affordable for mass market uptake.
We saw the Samsung 55in OLED TV at CES in Las Vegas we were seriously impressed but the set won’t be arriving in stores until the second half of 2012 when it is likely to cost somewhere around the £9,000 mark.
OLED is certainly the future and Samsung will know it needs to move in this direction, but the question it needs to answer is how quickly it dumps the LCD panels and transition to the better but more expensive OLED technology.