All good things come to an end, and so ends the joint venture between Samsung and Sony known as S-LCD Corporation. Formed in 2004, the Korean company supplied high quality liquid crystal displays for use in Sony and Samsung’s televisions and mobile phones. Other companies, such as HTC, also used S-LCD screens in their devices as well. Now Sony is working out the last details to offload its half of S-LCD Corp’s ownership to Samsung and move on to different sources for their flat panel displays. Sony cited the high costs involved in the joint venture for their decision to pull out, opting to tap cheaper flat panel alternatives from Taiwan and other companies instead.
The sluggish economies in the U.S. and in Europe also played a key role in Sony’s decision, as the high costs needed to be offset with a cheaper alternative. The end of the S-LCD partnership with Samsung is not a huge surprise as Sony penned a deal with Sharp back in 2008 to supply some of its flat panel displays to better compete with Samsung. That’s right, Sony and Samsung, two arch-rivals, made an agreement to corner the market with S-LCD Corp and then Sony turned around and signed a deal with its local Japanese rival, Sharp, to better compete against Samsung. Now Sony is leaving Samsung with a costly piece of baggage as it backs out of the S-LCD venture. The future of S-LCD remains uncertain but Samsung has not made any indication that it will shutter the business after it takes full control. In the meantime, Sony teaches us the importance of keeping your friends close and your enemies closer.
Hat tip to StyxaT