Once global leaders, Japanese electronics firms are tumbling
Why I picked up the article
Do you agree with the article? Certainly, Japanese electronics companies don’t seem so lively today but we have experienced their attractive products for decades since we were born. I think it is temporary and they can reach the summit again if they can change.
A former executive at a electronics firm said in the article“Everyone knows we need to change, and no one can make the changes”. Who do you think can change and how?
Should the government facilitate M&A that sometimes cause a monopoly of the market? Or should it encourage players to compete with each other making fairness of the market?
Japanese electronics firms are loosing their revenues and shares. Meanwhile America’s Apple and South Korea’s Samsung enjoys their prosperity. Since 2000, the big five Japanese electronics firms have lost two-third of their values. Not because of high costs, strong yen nor tax changes but the sickness runs deeper. Too many Japanese firms make similar things that cause inefficiency of the market and waste huge amount of capital.
※The story of NEC
NEC was the world biggest IT company but it failed to adapt changing world. Its shares have fallen by 90% and they forecast a \100 billion loss and would have to cut 9% of their workforce.
(1) Since foundation in 1899, its main customer was the state so NEC’s own culture has long been bureaucratic. (2) A business for NTT was a cosy arrangement for NEC but it was difficult to modify the specific technology for other client and it did not decide drastic reforms. (3) It also had little experience to make any business outside Japan. (4) Its brilliant technology was used to build the world fastest supercomputer and satellite network but these market were too small to make certain profit.