Sony-Panasonic tag team aims to outmuscle rivals in OLED TVs

Sony and Panasonic, Japan’s biggest makers of TVs, agreed to jointly develop sets using organic light-emitting diode (OLED) displays as they try to rebound from a combined 1.2 trillion yen ($15 billion) in losses last year.

The companies aim to establish a mass-production technology for OLED panels next year but refrained from adding when the new sets would be rolled out, they said in a statement yesterday.

The partnership is the first between the main TV operations at the two companies, which are losing money as the strengthened yen erodes overseas earnings and as competition from Samsung Electronics and LG Electronics intensifies. The two Korean companies have said they will introduce OLED models by Dec. 31.

“Sony and Panasonic wanted to do it separately, but neither of them had any alternative to cooperating as their TV businesses have recorded huge losses,” said Kazuharu Miura, a Tokyo-based analyst at SMBC Nikko Securities. “They may be able to speed up development by combining their technologies.”

Shipments of OLED TVs may grow to 2.1 million sets in 2015 from 34,000 in 2012, according to market research firm IHS iSuppli.

Samsung and LG both showed off 55-inch OLED sets at the CES in Las Vegas in January.

Sony, which introduced the first OLED TV with an 11-inch screen in 2007, is studying the demand for larger sets and the investment that would be needed to make them, Sony President Kazuo Hirai said in a February interview. OLED sets won’t represent the bulk of TV sales “next year, the year after or even the year after that,” Hirai said before becoming president in April.

Panasonic President Fumio Ohtsubo said in January that Panasonic wants to introduce OLED sets “not long after” Samsung and LG.

Sony posted a record 457 billion yen net loss for the year ending March 31 as its TV business was unprofitable for an eighth straight year. The unit will probably lose about 80 billion yen this fiscal year as Sony predicted sales will decline 11 percent to 17.5 million sets, the company said in May. Hirai plans to make the TV unit profitable in the year ending March 2014.

Panasonic will probably stop losing money from TVs in the quarter starting Jan. 1, Chief Financial Officer Makoto Uenoyama said in May. The Osaka-based company reported a record 772 billion yen net loss last fiscal year. Bloomberg