One Stop Selling

Sony and Samsung are showing us how major players are bracing up for tougher times. This could be the final call for big players to simplify market interfaces.

Sony Pictures Entertainment decided to organize itself around one global platform. The US and international divisions will merge to address more efficiently a market that demands swiftness and reactivity.

Samsung will regroup all its local mobile and nomadic brands around the
samsungmobile.com hub. At home, the brand needed some taming : Samsung being ubiquitous from real estate to life insurance, most business units had to develop specific brands for each line of products (ie Hauzen for air-con, Raemian for appartments). And it was not only a matter of branding : Samsung Electronics managed specific CRMs for its mp3 players (Yepp), laptops (Zaigen), and mobile phones (Anycall). Synergies seem obvious, to the point of scaring competitors : getting a share of a Samsung customer will get even tougher.

But Korea has reached the point where choices had to be made in favor of convergence instead of competition. The country wasted too much time and money in sterile IPTV wars between telcos, cablecos, and broadcasters, threatening Korea Inc.'s overseas (see "
IPTV in Korea", "IPTV wars and WiBro truce ?"). Korea could display its technological know-how in convergence, but no commercial offers.

A converged broadcasting-telecom regulator was created last year (the KCC - Korea Communications Commission), and a few months after mobile leader SKT wolfed down #2 fixed broadband operator Hanaro, landline leader KT is merging with #2 mobile operator KTF. At last, triple play offers and VoIP are taking off. Korea Telecom is advertising massively for QOOK, its new brand for convergence.

The current crisis will accelerate concentration, and a few ambitious players will emerge stronger in both size and R&D. Korean, Japanese, European, or American players cannot afford keeping a defensive profile for long : after stimulating R&D and investments (TD-SCDMA, stimulus plans), China will probably force mergers among telecom manufacturers the way it is pushing carmakers to join forces.

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