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Competitive Strategies Case Study

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Case Title:

Screen Wars: LCD vs Plasma

Publication Year : 2006

Authors: Sandeep Varma, Doris John

Industry: Home Appliances and Personal Care Products

Region:Global

Case Code: COM0145C

Teaching Note: Available

Structured Assignment: Not Available

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Abstract:

Plasma TVs had been ruling the market for 40 inches and larger screens to date, because Liquid Crystal Display (LCD) makers faced quality problems when they tried to make larger screens. The Plasma makers, in turn, could not reduce the size, for the screens tended to lose brightness as they shrank. Plasma TVs in larger sizes were in fact cheaper to make, since the glass needed was less sophisticated and cheaper than the glass used in LCD panels. But in 2006, the Korean, Japanese and Taiwanese companies, who were into the LCD technology, fought hard to gain ownership of the global television market. For a long time it was believed that the LCD technology was suitable only for the smaller sized televisions and could not compete with Plasma technology in larger sizes. This belief changed with the introduction of the seventh-generation (G7) plants by various LCD manufacturers

LCDs got larger and posed a big threat to companies such as Matsushita Electric Industrial Co. (Panasonic) and Pioneer Corp. of Japan. These companies made big Plasma screens. Plasma TV makers controlled 88% of the market for 40-inch-plus, thin-screen televisions. The cost of both LCD and Plasma TVs came down. They achieved cost reduction by increasing the dimensions of glass substrates used, but the cost reduction effect was very small beyond 6th or 7th generation plants. Cost reduction beyond that point would require cutting materials and other cost-through- volume production effects, slowing the pace of production. As a result of this there was a price war between LCD and Plasma TV manufacturers. Now the customers have a wide range of products to choose from. This case captures the latest developments happening in the world of LCD and Plasma TVs and allows for discussion on how the future would take shape.

Pedagogical Objectives:

  • To introduce the students to the Competition between LCD and Plasma technology
  • To highlight the inherent advantages and disadvantages of both these systems
  • To underscore the technological advancement in both LCD and Plasma
  • To detail how players in both streams were coming out with various new versions
  • To foresee the future of the TV market - which technology will have an edge over the other?

Keywords : LCD; Plasma; Flat screen; Televisions; Competitive Strategies Case Study; Technology; Liquid Crystal Display; Marketing; Strategy; Brands; Product innovation

Contents : 
Advantages and Disadvantages of LCD and Plasma
Growing competition
Comparison of LCD and Plasma technology
Price comparison between LCD and Plasma TVs
SED Technology in comparison with LCD and Plasma

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