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Will Pioneer exit the TV business?

Consumer Reports News: February 10, 2009 06:08 AM

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Could this be the last year we see the well-respected—and highly rated, by Consumer Reports—Pioneer Kuro plasma TVs in the marketplace?

That's the word coming out of Japan, where media reports suggest that Pioneer will announce its exit from the TV business later this week. If so, the company would be the latest plasma defector, following the likes of Philips, Sony, and Toshiba. However, unlike those brands—which dropped plasma to focus on LCD TVs—Pioneer has no presence in LCD TV, which could mean the end of Pioneer as a TV brand altogether. Just last year Sharp took an equity stake in the company, with the idea that Pioneer would enter the LCD market this year with sets sourced from Sharp as part of the deal, something that now looks unlikely to happen.

In response to questions from Consumer Reports, Pioneer called the reports "speculation" by a Japanese journalist, saying that the company is currently "reviewing all the business operations to make our mid-term business strategy group wide." Pioneer says it will announce new restructuring measures officially on Feb. 12, 2009 in Japan, or as soon as tomorrow in the U.S. as Japan is 14 hours ahead of Eastern Standard Time.

Pioneer has typically targeted more affluent customers, especially with its step-up Pioneer Elite models. The company has earned a following with a line of plasma TV models that set the industry benchmark for black levels. Still, selling a pricey TV has never been easy, and recent economic woes have made it even more difficult to compete in a market where well-regarded competitors, such as Panasonic and Samsung, typically price their models for thousands less than a Pioneer of a similar size. For example, in our latest Ratings of plasma TVs (available to subscribers), a 50-inch Pioneer Elite PRO-111FD sells for about $5,000. Samsung's PN50A650 is priced at $1,900, and Panasonic's TH-50PZ800U model is $2,400. And both companies offer even lower-priced 1080p 50-inch sets with comparable performance.

In an effort to become more competitive, last year Pioneer announced it would stop manufacturing its own plasma panels and instead source them from Panasonic. The deal with Sharp was expected to broaden the company's offering to include LCDs, which now constitute 90 percent of all TV sales.

Stay tuned for more news about Pioneer's plans for TVs—including on-going support of models already sold—in the near future.

—James K. Willcox

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