Mon, Jan 09, 2012 - Page 11 News List

Vizio enters PC market with new line this week

UNDER PRESSURE:The firm that drove Pioneer and Royal Philips out of the TV business with cheap screens from Taiwan is now setting its sights on Hewlett-Packard

Bloomberg

Vizio Inc, the TV maker that helped drive higher-cost rivals out of the business with rock bottom prices, plans to bring the same mayhem to the personal computer market.

Vizio will unveil two desktop PCs and three notebooks at the Consumer Electronics Show in Las Vegas this week, Vizio chief technology officer Matt McRae said in an interview.

The Windows-based machines will go on sale by June at a “a price that just doesn’t seem possible,” he said, declining to provide specifics.

The company’s push into the market could increase pressure on Hewlett-Packard Co and other PC makers, which already have seen profit margins narrow. In the TV business, Vizio put the squeeze on Pioneer Corp and Royal Philips Electronics NV, two consumer electronics veterans that ultimately exited the market.

“It’s very similar to TV — we want to get in there and disrupt it,” McRae said. “We think most PCs have been designed for the small business users, that others have not done a very good job of making them entertainment devices.”

Vizio’s desktop PCs will sport 24 or 27-inch screens that hide their electronics within the displays, similar to Apple Inc’s iMac. Vizio also plans to offer a notebook with a 15.6-inch screen and two -ultra-thin versions with 15.6-inch and 14-inch screens. All the computers will include entertainment features that deliver audio and video to Vizio TVs and speakers.

Vizio, a closely-held company based in Irvine, California, is vying with Samsung Electronics Co for dominance of the US TV market. Most TV makers lost money in the industry last year owing to low prices and sluggish consumer demand. In December, Sony Corp agreed to sell its stake in a venture with Samsung that makes LCDs after predicting an eighth consecutive year of losses from TVs.

Vizio has succeeded by getting cheap screens from Taiwanese contract manufacturers Foxconn Technology Group (富士康科技集團) and AmTRAN Technology Co (瑞軒科技), which also hold equity stakes in the company. Vizio also sells an 8-inch tablet computer for between US$250 and US$300. Apple’s iPad starts at US$499.

Vizio is targeting two of the -fastest-growing categories for PC makers: ultra-thin laptops and so-called all-in-ones — desktop machines with built-in monitors. Still, those areas are getting more crowded. Hewlett-Packard will introduce a new all-in-one PC for US$1,200 at the Consumer Electronics Show, and other computer makers are unveiling slimmer laptops, a category known as ultrabooks.

Hewlett-Packard is betting that the ultrabook category will resemble other parts of the PC market, with consumers and businesses asking for different designs that meet their needs, Hewlett-Packard marketing vice president Page Murray said.

“I don’t believe there’s a one-size-fits-all laptop out there, like some of our competitors might,” Murray said.

Driving down prices isn’t a viable long-term strategy, he said.

“There’s always going to be somebody who wants to win a race to the bottom, but you get what you pay for in many of those situations,” he said.

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