Orange-based Westinghouse Digital LLC is still standing as the TV market has coalesced around a few big players.
Westinghouse Digital is part of a crop of TV companies that do design and marketing here but outsource everything else.
In 2003, the company’s founders struck a licensing deal with New York’s CBS Corp. to use the Westinghouse name, an icon of early electronics.
Westinghouse Digital’s strategy is to be a U.S. sales outlet for an Asian supplier, in this case Taiwan electronics glass maker Chi Mei Corp.
It’s a page out of the book of the largest seller of flat TVs, Irvine-based Vizio Inc. One of Vizio’s biggest investors and suppliers is Taiwan’s AmTran Technol-ogy Co.
Westinghouse Digital “was founded on the premise that we could make it in the growing market for LCD TVs,” President Doug Woo said. “There were a lot of other companies trying to make it at the time.”
Not all of them survived as the market has shaken out in the past five years or so.
Motorola Inc. had a short-lived venture with Moxell Technology Inc., part of Taiwan’s Proview LED Technology Co.
Arizona’s Syntax-Brillian Corp. made TVs under the Olevia brand name until 2009, when it declared bankruptcy and sold its assets to Emerson Radio Corp.
Westinghouse Digital has been able to carve out a small slice of the market, which is dominated by Vizio and South Korea’s Samsung Group.
King of LCDs
Vizio is king of the new breed of TV designers and marketers that tap Asian suppliers for its sets.
Westinghouse Digital has felt the pull as Vizio has gained a lead and grabbed market share from bigger, more established players through product engineering, aggressive pricing and marketing.
Vizio held 18% of the North American market for liquid-crystal display screens in 2010, up from 16% in 2009, according to data from DisplaySearch, a unit of Port Washington, N.Y.-based market researcher NPD Group Inc.
Vizio topped Samsung, Sony Corp. and Funai Electric Corp., which sells sets under the Philips brand in the U.S.
Westinghouse Digital is barely clinging to the top 10, with 1.2% market share in 2010. That’s up from 1% in 2009.
The privately held company said it expects to sell about a million sets this year.
The Business Journal estimates Westing-house Digital sees about $250 million in yearly sales.
Vizio counted $2.5 billion in yearly sales in 2009, the most recent revenue figure available. The company sold about 8 million sets in 2010.
A few years ago, Westinghouse Digital was neck and neck with Vizio with roughly 5% of the market, according to DisplaySearch.
“You had your established brands and a lot of new ones that jumped into the market as it was growing,” said Paul Gagnon, director of North America TV research at DisplaySearch. “It was relatively easy to put together a brand and sell TVs here.”
At one point, Westinghouse Digital sold more TVs than Vizio, Gagnon said.
In the past few years, increased competition and rapidly falling prices from the bigger players squeezed out a lot of newcomers, Gagnon said.
What tipped the scales for Vizio was landing Wal-Mart Stores Inc. in 2007.
“When Vizio started growing their share at Wal-Mart, that left fewer spots on the shelf,” Gagnon said. “Vizio won through superior distribution.”
Westinghouse Digital has been in talks with Wal-Mart and has supplied the retailer with “drop-in” shipments of a few hundred thousand TVs in certain markets.
“We are not in Wal-Mart yet,” Woo said. “Everyone talks to Wal-Mart. The question is whether they are ready to buy from us.”
Retailers
Westinghouse Digital’s retail lineup is nothing to sneeze at.
It sells TVs via Amazon.com Inc., Best Buy Co., BJ’s Wholesale Club Inc. and Costco Wholesale Corp. Its biggest customer is Target Corp.
Like Vizio, Westinghouse Digital’s TVs sell for hundreds of dollars less than those of the big consumer electronics makers.
Target made headlines on Black Friday after Thanksgiving by hawking a 40-inch Westing-house TV for $300.
The sets don’t include a lot of the bells and whistles, such as Internet access and rapid refresh rates, which reflect how quickly a picture is displayed.
Westinghouse Digital and Vizio have a shared history.
In the 1990s, Woo worked locally for Vizio cofounder and Chief Executive William Wang for nearly a decade at two of his early computer monitor companies, Princeton Digital Corp. and Mag InnoVision Co.
The two are friends.
“The display community is small and a lot of it is in Orange County,” Woo said.
Westinghouse Digital is positioning its century old brand name as sort of the everyman’s TV, according to Woo.
“When Westinghouse does a product, it’s because it’s ready for everyone,” he said.
He hopes to play off of Westinghouse’s dominance in radios in the early part of the last century.
“Radios were around in the 1930s and 1940s, but it took Westinghouse to make them into a mass consumer product,” Woo said. “The concept behind the brand is it’s a regular product now, it’s a good value, it’s solid and it’s very Middle American.”
Woo, who’s also a trademark, intellectual property and corporate lawyer, said he handpicked the Westinghouse name because of its wide recognition.
Westinghouse, a onetime electronics maker that bought and became CBS in the 1990s, used to sell TVs, too.
Other companies license the Westinghouse name today, including makers of light bulbs, ceiling fans, light fixtures, solar panels, heating and air conditioning units, wireless intercoms and a host of other household items.
Resurrecting a brand that some still associate with grandma’s house isn’t easy, according to Woo.
“The challenge for all of the licensees in the new consumer electronics environment that Westinghouse is creating is to give a relevance and currency to the brand,” he said. “That’s a challenge that we have had for the last seven years.”
