Hitachi’s Flat-panel
TV Business Strategy
Aiming to be the leader in HD TV Worldwide
2005/12/20
Makoto Ebata
Vice-President and Executive Officer, Hitachi, Ltd.
President & CEO, Ubiquitous Platform Systems
Group
© Hitachi,Ltd.2005
All rights
reserved
CopyrightCopyright
© Hitachi,Ltd.2005
All rights
reserved
Contents
1. Introduction
2. Importance of Digital Consumer Business
for Hitachi
3. FPD TV Markets Trends and
Hitachi’s Business Targets
4. Scenario for Success
5. Conclusion
Copyright
© Hitachi,Ltd.2005
rightsreserved
reserved
Copyright
© Hitachi,Ltd.2005
AllAllrights
Contents
1. Introduction
2. Importance of Digital Consumer Business
for Hitachi
3. FPD TV Markets Trends and
Hitachi’s Business Targets
4. Scenario for Success
5. Conclusion
Copyright
© Hitachi,Ltd.2005
rightsreserved
reserved
Copyright
© Hitachi,Ltd.2005
AllAllrights
1
Introduction
Hitachi’s Goals in the FPD TV Business
Reinforce and cultivate FPD TV business by combining
Hitachi’s strengths from research through to sales
FY2006/2H: Return to profitability
Business
targets
FY2008: Capture leading global share in PDP HD*
TVs (30%)
: Win 7% share of global market for LCD TVs
larger than 26-inch
Concentrate investment and specialize in growing HD market
Enhance global production and sales
Concentrate company wide development capabilities in
panels（PDP,LCD） and components （HDDs, LSIs and others）
※HD : High Definition
Copyright © Hitachi,Ltd.2005 All rights reserved
Contents
1. Introduction
2. Importance of digital consumer business
for Hitachi
3. FPD TVs’ markets trends and
Hitachi’s business targets
4. Scenario for Success
5. Conclusion
Copyright
© Hitachi,Ltd.2005
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reserved
Copyright
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2-1
Hitachi’s Digital Home Electronics Product Group
Hitachi has full lineup of products for 3 major networks
Cellular phone
PDP TV
Imaging
devices
Recording
devices
Information
Rear – Projection TV
LCD
Projector
Car navigation system
Rolling out 3 major networks
HDD/DVD
Recorders
DVD Cameras
Broadcasting
IP （ * 2）
Broadband
BB （ *1） PC
devices
Home Networking
*1　BB：Broadband
*2　IP：Internet Protocol
Copyright © Hitachi,Ltd.2005 All rights reserved
2-2
Hitachi’s Goals in the Digital Home Electronics Market （１）
Centered on PlasmaTVs, capture the top position in the digital home electronics market
≪Policies and Targets by Product ≫
Product
Target share(%)
FY
2005
2006
2007
2008
Ｗ/Ｗ
１１
１４
１８
２０
３９
４１
４３
Japan
３５
Plasma
TVs
Ｗ/Ｗ
LCD
TVs
Japan
２
５
４
５
６
６
Policy
Focus on Hi - vision Market
Target global HD market
share of 30% (2008)
７
７
Focus on 26-inch and larger
screen models
*LCD shows 26-inch and larger models.
Copyright © Hitachi,Ltd.2005 All rights reserved
2-2
Hitachi’s Goals in the Digital Home Electronics Market (２)
≪Policies and Targets by Product ≫
Product
Target share(%)
FY
2005
Ｗ/Ｗ
２
HDD/DVD
Recorders
Japan
Ｗ/Ｗ
DVD
Cameras
Japan
４
５
１０
2006
５
2007
2008
９
１０
１８
２０
１０
１２
９
８
１３
１７
２０
Policy
Pursue Top 3 Market
Position
Japan: Specialize in premium
products
(Built-in terrestrial digital tuner
+ high-capacity HDDs)
Create DVD camera market attuned
to changes in media formats
Secure leading share in Japan
*DVD Cameras show video camera market.
Copyright © Hitachi,Ltd.2005 All rights reserved
2-3
Expand Hitachi’s Digital Home Electronics Business
Expand Digital Home Electronics Business Centered on FPD TVs
Billions yen/year
(Sales of Digital Home Electronics)
１,５００.０
Net Sales
８５０.０
Leverage Company made Strengths
to Cultivate Digital Home Electronics
into Growth Business
FY2005
FY2010
Copyright © Hitachi,Ltd.2005 All rights reserved
Contents
1. Introduction
2. Importance of digital consumer business
for Hitachi
3. FPD TVs’ markets trends and
Hitachi’s business targets
4. Scenario for Success
5. Conclution
Copyright
© Hitachi,Ltd.2005
rightsreserved
reserved
Copyright
© Hitachi,Ltd.2005
AllAllrights
3-1 Global Market Trends:Broadcasting
Global Broadcasting Industry Shifting to Digital Hi-vision Format
２００５　２０１０
Broadcasting
Introduction phase
Uptake phase
Digital hi-vision broadcasting worldwide
Digital broadcasting
▼2011
End of analog broadcasts
Japan
China
Europe
Launch and shift
to digital
▼2015 ▼2006～2012
USA
Content
▼ Late 2008
Complete
shift to digital
Sales of hi-vision software in Blu-ray disc and HD-DVD formats
Broadband broadcasting
Copyright © Hitachi,Ltd.2005 All rights reserved
3-1 Global Market　Trends: Flat-Panel　TVs
Expansion in FPD TVs demand
<Plasma TVs>
<LCD TVs>
(Demand: millions of units)
(Demand: millions of units)
833 Large screens
shows comparison with base year of FY2004=100
30.0
464
13.0
556
393
20.0
11.0
311
8.7 Large screens
204
100
0.6
・
・・
2.8
294
10.6
5.7
Mid-size screens
100
Large screens
(37-inch and over)
・・
・
0.05
Mid-size screens
FY2002
1,111　40.0
FY2004 FY2005 FY2006 FY2007 FY2008
FY2002
3.6
Mid-size screens
(26-inch to 37-inch)
FY2004 FY2005 FY2006 FY2007 FY2008
Copyright © Hitachi,Ltd.2005 All rights reserved
3-1 Global Market Trends : Plasma TVs
Upsurge in ratio of HD Products after FY2005
Plasma TV Demand Trend
shows HD Plasma TV demand compared
with base year of FY2004=100
707
530
70％
62％
365
54％
208
100
【Ratio of HD products】
FY2002
47％
HD Type
46％
FY2004
FY2005
FY2006
FY2007
FY2008
Copyright © Hitachi,Ltd.2005 All rights reserved
3-2 Investment in Digital Media Products
First in Industry to Focus on FPD TVs
2005　２００５～
Fiscal year 2000　～１９９９
２００１
２００３
TVs sets
CRT TVs
FPD （Plasma TVs, LCD TVs）
Switch
Switch from
from Analog
Analog to
to Digital
Digital High
High vision
vision
▲2005
Establish IPS alpha
(LCDs)
Production Start： FY2006 2Q
Production Capacity: 2.5 million units/ year
Imaging
Devices
［Capital Investment］
110.0 billion yen
▲2005
▲1999
Establish FHP
(PDPs)
Production Capacity：
Consolidation FHP
100,000 units / month(Aug, 2005)
⇒300,000 units / month
(from FY2007 to FY2008)
Recording
Devices
and Others
▲2000
HLDS
(DVD Drives)
▲2003
［Capital Investment］
155.0 billion yen
▲2003
Hitachi GST Renesas
(HDDs)
(LSIs)
【Subsidiaries】
・FHP : Fujitsu Hitachi Plasma Display
・HLDS : Hitachi LG Data Storage
・Hitachi GST : Hitachi Global Storage Technologies
【Equity-method Affiliates】
・Renesas : Renesas Technology Corp.
・IPS alpha : IPS Alpha Technology, Ltd.
Copyright © Hitachi,Ltd.2005 All rights reserved
3-3 Hitachi’s Initiatives for the FPD TVs Business(1)
FPD Business Sales Targets
<Plasma TVs>
30%
Share of HD market
<LCD TVs>
30%
27%
Share :26-inch and larger TVs
６%
７%
23%
18%
11%
18%
12%
20%
2.6
14%
１%
Share of overall Plasma TV market
２%
2.0
2.0
(Sales : millions of units)
(Sales : millions of units)
1.2
0.75
0.68
0.3
2004
0.05
2005
2.8
４%
2006
2007
2008
(Fiscal Year)
2004
0.2
2005
2006
2007
2008
(Fiscal Year)
Copyright © Hitachi,Ltd.2005 All rights reserved
3-3 Hitachi’s Initiatives for the FPD TVs Business(2)
Issues for Hitachi’s FPD TVs business
Overall：From FY2001 to FY2004, sales expanded, profitable　FY2005 : Delay in market growth, loss　Recover in FY2006
Market Trends in FY2005
TVs
HD ratio leveling
off despite market
growth
LCD
TVs
Expansion in
mid-size LCD TVs
Misunderstanding
of market trends
Products Plasma
Issues for Hitachi
Lack of appeal of
HD lineup
Delay in establishment of
panel supply system
Cost
Rapid fall in sales
price about 30% per
year
Delay in cost cutting with
integrated in panels and sets
Delay in increasing
panel production
Globalization
Market rapidly
expanding worldwide
Delay in strengthening
W/W SCM system
Lack in strengthening
W/W sales promotion and
branding activities
Sales,
Branding
Copyright © Hitachi,Ltd.2005 All rights reserved
3-3 Hitachi’s Initiatives for the FPD TVs Business(3)
Business
Target
Back to Profitability in FY2006 2Q　【 share of market Shipments 】
Plasma TVs ：1.2 million (14%), LCD TVs：750,000-lerel(4%)
FY2008　Plasma TVs : Achieve top share in W/W HD market(30%)
LCD TVs : Gain 7% share of W/W 26-inch and larger market
Hitachi’s strategy and key measures
Large Screen : Focus on Plasma TVs
Products
Strategy
Mid-size Screen : Focus on LCD TVs
Production
Capability
Sales and
Marketing
Focus on HD markets
Business Strategy
Enhance
Products,
Strengthen
Development
Capability
Benefits of
vertical integration
Cost
Become most cost-competitive maker of HD plasma TVs
Achieve level of cost comparable with VGAs in Plasma TVs
Strengthen and speed up development
Synchronized business planning panel and TV set
(introduce new models twice a year)
HD PDP：World-leading production capability
(FHP #3plant)
Expand global production capabilities
Reinforce global sales structure
Improve advertising and sales promotion focus on HD
market
Sustained and concentrated investment in marketing
Copyright © Hitachi,Ltd.2005 All rights reserved
Contents
1. Introduction
2. Importance of digital consumer business
for Hitachi
3. FPD TVs’ markets trends and
Hitachi’s business targets
4. Scenario for Success
5. Conclusion
Copyright
© Hitachi,Ltd.2005
rightsreserved
reserved
Copyright
© Hitachi,Ltd.2005
AllAllrights
4-1
Scenario for Success :
Enhance Products and Strengthen Development Capability(1)
Review Product Plans
Focus on HD + Unique Products
(e.g.internal HDD and other features)
Products introducing plan with global events
(introduce new models twice a year)
Strengthen Development Capability
Consolidated development capabilities
(Enhance and leverage company-wide strengths)
Copyright © Hitachi,Ltd.2005 All rights reserved
4-1
Scenario for Success :
Enhance Products and Strengthen Development Capability(2)
Plasma TV Products’ Roadmap
Introduce new lineup with advantages of ALIS(*)
Points
Expand lineup to FULL-HD type, launch
mainstream lineup for 37-42-55-inch TVs
FY2005
Mainstream
FY2007
FY2006
37-42–55- inch HD new line-up
Expand FULL-HD type
42-inch FULL-HD Type
60-inch class
FULL-HD Type
Key Factors behind Enhance Competitiveness
1.Glass thickness 1.8mm　2.Direct filter application
3.Development of non-lead PDPs
4.Benefit of alliance with Matsushita Electric Industrial Co.Ltd.
(Standardization of a parts and material)
*ALIS: Alternate Lighting of Surfaces Method
Copyright © Hitachi,Ltd.2005 All rights reserved
4-1
Scenario for Success :
Enhance Products and Strengthen Development Capability(3)
Product Roadmap to Coincide with Global Events
Launch Products to Coincide with Global Events, Back to Back Spring & Fall Product Launches
FY2005
Events
▼Dec, 2005
Christmas,
year-end and
new year events
▼Feb, 2006
Torino
Olympics
Roadmap Product
005
s for 2
l
e
d
o
M
Internal terrestrial
digital tuner
FY2006
▼June, 2006
FIFA World cup
▼Dec, 2006
Christmas,
year-end and
new year events
Simultaneous global launch
r 2006
r 2006
o
o
f
f
s
s
l
l
e
e
od
od
New m
New m
（Aug. 2006～）
（Apr, 2006～）
fall
Spring
New ALIS panel
New IPS panel
Further evolution Wooo
high definition TVs
Plasma TVs : 37- 42- 50- 55- inch
LCD TVs : 26- 32- 37- inch
Copyright © Hitachi,Ltd.2005 All rights reserved
4-1
Scenario for Success :
Enhance Products and Strengthen Development Capability(4)
Concentration of HD Development Section, Sales and Marketing Sections.
Apr, 2005　Apr, 2006
Area
Jan.2006
HD Development
Yokohama
TVs
Yokohama
Ebina
PCs
approx. 1,600 personnel
Tokai
HDD/DVD recorders
FHP
Driver circuit design
Benefit
Sales and Marketing
Yokohama
Tokyo
Horizontal technology development
Cost reduction via vertical integration
Marketing
Sales
Tokyo
approx. 500 personnel
Reflect customer needs in product roadmap
Benefit Faster decision-making
Copyright © Hitachi,Ltd.2005 All rights reserved
4-1
Scenario for Success :
Enhance Products and Strengthen Development Capability(5)
Expand HD Product Development ： FY2004 ⇒ FY2007 1.5 times
Concentrate Groupwide Development Capabilities
Division
Items　Digital Media Div.
R&D for
HD products
Fujitsu Hitachi
Plasma Display
Development
of FULL-HD
driver circuit
Ubiquitous Platform Platforms for
HD products
System R&D Lab.
Embedded Systems
Structure Research
Institute (R&D group)
Actions　Expand Capabilities
Concentrate
FY2004
R&D sections
FY2005-FY2006 Approx. 1,400
Specialize
in HD Establish
Next generation
HD image
rendering technology
R&D centers
for each global
base in FY2006
2007年度
FY2007
Approx. 2,000
Establish
in FY2005
Copyright © Hitachi,Ltd.2005 All rights reserved
4-1
Scenario for Success :
Enhance Products and Strengthen Development Capability(6)
Mobilize Hitachi’s corporate laboratories’ capabilities to tackle more FPDsuperior related technology (approx. 500 of 3,700(*) personnel)
Important Benefits and Research items
Hitachi Research
Laboratory
Production Engineering
Research Laboratory
Central Research
Laboratory
Mechanical Engineering
Research Laboratory
High-performance
Panel Technologies
High Production Reliability
and Improved yields
Next-generation
User interface
Structural & Cryogenic
Technologies
System Development
Laboratory
System Development
Advanced Research
Laboratory
Overseas research
laboratories
Basic Technologies
for Next-generation TVs
PDPs, LCDs
Best picture quality
High yields
Advanced
technologies
FPD TVs
*　forecast for all Hitachi’s corporate laboratories’ capabilities for FY2005
Copyright © Hitachi,Ltd.2005 All rights reserved
4-1
Scenario for Success :
Enhance Products and Strengthen Development Capability(7)
Strategic Partnership with Hitachi Group Component businesses,
Forward-looking Joint Development
Fujitsu Hitachi Plasma display PDPs
Leading PDP maker in HD
IPS Alpha Technology, Ltd. LCDs
Hitachi Chemical and others Display-related materials
Renesas Technology Corp.
Driver ICs, LSIs
FPD TVs
Hitachi Global
Storage Technologies
Hard disk drives
Leading maker
of built-in HDD TVs
Hitachi Media Electronics
Tuners
Hitachi LG Data Storage
DVD drives
Advanced installation
of W-terrestrial digital tuners
Copyright © Hitachi,Ltd.2005 All rights reserved
4-2
Scenario for Success : Strengthen Cost Competitiveness (1)
Promote Strategic Cost Reduction for Plasma TVs
Become most cost-competitive maker of HD TVs
Achieve level of cost comparable with VGAs for
plasma TVs
ポイント
Copyright © Hitachi,Ltd.2005 All rights reserved
4-2
Scenario for Success : Strengthen Cost Competitiveness (2)
Major Initiatives Behind Realizing Cost Strategy
Strengthen Cost-competitiveness of Plasma TVs
■ Common global HD platform
1.Promote high-level integration of digital LSIs
2.Rationalization of digital IC component
3.Enhance development efficiency through
componentization of software
(Aim to increase efficiency by a factor of five by FY2008)
Strengthen Cost-competitiveness of PDPs
■ Improve cooperation between FHP and Hitachi
1. Enhance development capabilities
(boost luminescence efficiency, direct filter application, etc.)
2. Bring FHP’s #3Plant on stream (increase productivity and yields)
■ Promote project to reduce cost of large components through
modularization
Copyright © Hitachi,Ltd.2005 All rights reserved
4-2
Scenario for Success : Strengthen Cost Competitiveness (3)
Plasma TVs : Cost Reduction Plan
Total cost and sales price of domestic 42-inch plasma TV,
including built-in digital tuner
Sales price　20-30% down
Total Cost
100
80
Others
Manufacturing
Costs
69
60
FY2008 : Reduce costs to
withstand 5,000 yen per inch
price level
Ongoing
Ongoing cost
cost reduction
reduction
ahead
ahead of
of falls
falls in
in sales
sales price
price
Material Costs
Panel
1st Half 2nd Half 1st Half 2nd Half
FY2005
FY2006
Copyright © Hitachi,Ltd.2005 All rights reserved
4-2 Scenario for Success:
Strengthen Cost Competitiveness (4)
Boost Cost-competitiveness of Plasma TVs
（Scale of 1-100 ）
FY
2004
2005
2006
Shipment
period
Summer
Summer
Spring
No. of
components
Material
costs
100
80
70
100
70
50
Key target
areas for cost
reduction
compared to
previous
year
All-in-one speaker
components/AVC/ monitor
unit (-28%)
Rationalization of circuit
systems for digital tuner
(complete digitization)
(-45%)
More streamlined
construction compared to
previous models (-41%)
Greater integration of
digital ICs (-50%)
Rationalization of unit
components (power supply,
speaker components)
(-42%)
Rationalization of structural
components (frame, filter
components) (-42%)
Copyright © Hitachi,Ltd.2005 All rights reserved
4-2 Scenario for Success:
Strengthen Cost Competitiveness (5)
Cost Reduction Plan for Plasma TVs
1. Panels: Improve usage rate, use more panels from glass substrate for 42inch modules, reduce thickness (1.8 mm)
Specific
2. Circuits: Promote greater integration, rationalize construction of frame
Cost Reduction and finished product
Initiatives
3.Other: Use direct filter application, promote central purchasing of core
components (utilize Hitachi’s strengths in procurement)
（Scale of 11-100 ）
【Cost of 42-inch PDP modules】
100
Catch up with VGA
costs in spring of
2006
80
60
Variable costs
40
20
Fixed costs
2004 models
Other companies
VGA costs
(Hitachi
estimates)
2005 models
2006 modelsCopyright © Hitachi,Ltd.2005 All rights reserved
4-3 Scenario for Success:
Boost Output & Build Business Infrastructure(1)
Expand Manufacturing Framework
Panels:Increase Production Capacity with Construction
of #3 Plant at FHP and New Plant at IPS Alpha.
Plasma TVs:Strengthen Overseas Supply Capabilities by
Setting up Global Manufacturing Sites that Utilize
Vertical Integration
Shift to High-efficiency Operating Structure
Improve Efficiency by Enhancing SCM
Achieve Low-cost Operations through Reforms to
Logistics
Copyright © Hitachi,Ltd.2005 All rights reserved
4-3 Scenario for Success:
Boost Output & Build Business Infrastructure (2)
Plasma Panels: Begin operations at FHP’s #3 Plant,
world’s largest HD panel production facility
100,000 units/month system
Aug. 05, #2 plant
#2 Plant
#3 Plant
200,000 units/month system
Oct. 06, #2 and #3 plants
#2 Plant:280m X 100m
= Approx. 56,000m2
300,000 units/month system
#3 Plant:320m X 120m
= Approx. 88,000m2
By 2008, #2 and #3 plants
Illustration of completed #3 Plant
A high-efficiency facility
Capital investment efficiency: 1.5 times
Panel-use efficiency: 2
Lead time reduction: 1/2　Space efficiency: 1.5 times
An eco-friendly facility
Improvement in energy usage: 1.1 times
Water recovery ratio: 1.5 times
Volume of waste generated: 1/2
(All comparisons with 2nd plant)
Copyright © Hitachi,Ltd.2005 All rights reserved
4-3 Scenario for Success:
Boost Output & Build Business Infrastructure (3)
Reforms to Production Framework:
Strengthen and Expand Global Manufacturing Network
Panel Production (Japan)→Supplied to Assembly Sites
FY2007～
Examine in-house
production
４
North America
EMS
(HHEA)
China
Panels
Europe
10
６
Japan
(HFDM)
LCD TVs
６
(Gifu)
2004 2005 2006 2007 FY
Plasma TVs
０
Unit: 1000 units/month
(monthly average)
Boost Global Production and Supply Capacity:70,000 units/month(FY2005)　(Fivefold increase) 330,000 units/month(FY2007)　* HFDM:Hitachi Fujian Digital Media Co., Ltd
HHEA:Hitachi Home Electronics (America), Inc.
Copyright © Hitachi,Ltd.2005 All rights reserved
4-3 Scenario for Success:
Boost Output & Build Business Infrastructure (4)
Reforms to Production Framework: Integrate Module production processes and
finished product assembly at single sites
Aims of
Integrated
Production
Reduce Production Planning Work and Mid-process Inventories
Load Efficiency Increased and Logistics Costs Reduced by Only
Transporting Panels to Local Markets
Costs Reduced by Avoiding Import Tariffs and Increasing Sourcing
of Local Components
Concentrate production
(Miyazaki)
Electrodes/lightAttaching and
emitting component
sealing
(Front-end processes) (Back-end processes)
Integrated production
by region
Driver circuit
components
(Module processes)
Finished
Products
Preparations completed in Japan/China; similar steps to be taken in North America and Europe
Copyright © Hitachi,Ltd.2005 All rights reserved
4-4 Scenario for Success:
Enhance Global Sales Capabilities (1)
Enhance Global Sales Capabilities and Hitachi’s brand
Initiatives to Strengthen Regional Marketing
Campaigns to Boost Brand power
Sustained and Concentrated Investment in Marketing
Improve Advertising and Sales promotion,
Focusing on HD Market
Copyright © Hitachi,Ltd.2005 All rights reserved
4-4 Scenario for Success:
Enhance Global Sales Capabilities (2)
Global Sales and Market Share Targets for Plasma TVs (HD Market)
FY2005
FY2008
FY2005
FY2008
North America
Europe
25%
Hitachi
30%
24%
15%
(0.7million units)
1st
China
(2.8million units)
51%
1st
(0.16million units)
Asia
17%
2nd
(0.4 million units)
49%
(0.6million units)
26%
(1.2 million units)
(1 million units)
7th
(3.5 million units)
Japan
40%
30%
2nd
(0.5 million units)
(0.79 million units)
※　( ):global market units
:Hitachi’s share
Copyright © Hitachi,Ltd.2005 All rights reserved
4-4 Scenario for Success:
Enhance Global Sales Capabilities (3)
Sales Channel Strategy by Region
Region
Core Strategy
Actions
Regions Targeted for
Regions Targeted for
Increased Sales
Sales Channel Expansion
Introduce Products via
Region’s Biggest Volume Retailers
Strengthen Regional Marketing Framework
(Develop 7 sites in North America, Create AE
positions)
Roll out Hitachi is HD sales campaign Increase No. of Sales Locations (From 21 to 60 cities)
Expand Network of Stores
North
America Develop Supermarket Channels
China
Europe Rebuild Sales Channels
Expand Network of Regional Stores
Introduce Products via Leading Volume Retailers
Russia Establish Sales Framework
Establish Local Sales Company (April 2006)
Japan
Capture more than 50% of Sales at 5 Biggest
Volume Retailers
Expand Regional Store Sales Channels
Strengthen brand and sales
Europe promotion capabilities
Asia
Strengthen Trading Relationships with
Biggest Volume Retailers (UK, France, Australia, Hong Kong)
*AE:Account Executive
Copyright © Hitachi,Ltd.2005 All rights reserved
4-4 Scenario for Success:
Enhance Global Sales Capabilities (4)
Sustained and Concentrated Investment in Marketing, 2005~2007
Concentrated Investment Focus
(2004: base year = 100)
300
(％)
100
FY2006:300
350
China
Asia １０ Japan
２０
１１
FY2004:100
200
China
Asia
４
１７
Japan
３５
３０ １４North America
Europe
2004
2005
2006
2007
FY
Europe
２４
North
America
３５
Ratio by geography(%)
Global Marketing Campaign to Strengthen Brand
Period
Greater Focus on more Unique Initiatives
First half of 2005
(completed)
Unified Global Marketing Campaign (36 Countries Worldwide)
-Tie-up with Hollywood movie “War of the Worlds” -
From second half
of 2005
Implements Next Major Global Marketing Campaign
Implement Brand Campaign for Different Markets (Jan, 2006 Europe)
Copyright © Hitachi,Ltd.2005 All rights reserved
4-4 Scenario for Success:
Enhance Global Sales Capabilities (5)
Global Advertising and Sales Campaigns Focusing on HD Products
Main Target Areas
Face of Campaign: Ms. Hitomi Kuroki
Japan
Hi-Vision TV with HDD recorder
プラズマで●ＲＥＣ
“Recording with plasma TV”
“Japan Black” Campaign
Europe
Integrated Advertising and In-store Sales Campaign
Main thrust: Japanese brands = High Quality
China
CCTV Tie-up Campaign
HD Partnership Signed
Actively Roll out Hitachi is
HD Campaign in China
Create more Visible Brand with
Customized In-store Sales Areas
*CCTV:China Central Television
Copyright © Hitachi,Ltd.2005 All rights reserved
Contents
1. Introduction
2. Importance of digital consumer business
for Hitachi
3. FPD TVs’ markets trends and
Hitachi’s business targets
4. Scenario for Success
5. Conclusion
Copyright
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5
Conclusion
Hitachi’s Goals in the FPD TVs Business
Reinforce and Cultivate FPD TVs business by Combining
Hitachi’s Strengths from Research through to Sales
FY2006/2H: Return to profitability
Business
targets
FY2008: Capture leading global share in PDP HD*
TVs (30%)
: Win 7% share of global market for LCD TVs
larger than 26-inch
Concentrate Investment and Specialize in Growing HD Market
Enhance Global Production and Sales
Concentrate Companywide Development Capabilities in
Panels （PDP,LCD） and Components （HDDs, LSIs and
others）　※HD：High Definition
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CAUTIONARY STATEMENT
Certain statements found in this document may constitute “forward-looking statements” as defined in the U.S. Private Securities
Litigation Reform Act of 1995. Such “forward-looking statements” reflect management’s current views with respect to certain
future events and financial performance and include any statement that does not directly relate to any historical or current fact.
Words such as “anticipate,” “believe,” “expect,” “estimate,” “forecast,” “intend,” “plan,” “project” and similar expressions which
indicate future events and trends may identify “forward-looking statements.” Such statements are based on currently available
information and are subject to various risks and uncertainties that could cause actual results to differ materially from those
projected or implied in the “forward-looking statements” and from historical trends. Certain “forward-looking statements” are
based upon current assumptions of future events which may not prove to be accurate. Undue reliance should not be placed on
“forward-looking statements,” as such statements speak only as of the date of this document.
Factors that could cause actual results to differ materially from those projected or implied in any “forward-looking statement” and
from historical trends include, but are not limited to:
- fluctuations in product demand and industry capacity, particularly in the Information & Telecommunication Systems
segment, Electronic Devices segment and Digital Media & Consumer Products segment;
- uncertainty as to Hitachi’s ability to continue to develop and market products that incorporate new technology on a timely
and cost-effective basis and to achieve market acceptance for such products;
- rapid technological change, particularly in the Information & Telecommunication Systems segment, Electronic Devices
segment and Digital Media & Consumer Products segment;
- increasing commoditization of information technology products, and intensifying price competition in the markets for such
products;
- fluctuations in rates of exchange for the yen and other currencies in which Hitachi makes significant sales or in which
Hitachi’s assets and liabilities are denominated, particularly between the yen and the U.S. dollar;
- uncertainty as to Hitachi’s ability to implement measures to reduce the potential negative impact of fluctuations in product
demand and/or exchange rates;
- general socio-economic and political conditions and the regulatory and trade environment of Hitachi’s major markets,
particularly, the United States, Japan and elsewhere in Asia, including, without limitation, a return to stagnation or
deterioration of the Japanese economy, or direct or indirect restriction by other nations on imports;
- uncertainty as to Hitachi’s access to, or ability to protect, certain intellectual property rights, particularly those related to
electronics and data processing technologies;
- uncertainty as to the success of restructuring efforts to improve management efficiency and to strengthen competitiveness;
- uncertainty as to the success of alliances upon which Hitachi depends, some of which Hitachi may not control, with other
corporations in the design and development of certain key products;
- uncertainty as to Hitachi’s ability to access, or access on favorable terms, liquidity or long-term financing; and
- uncertainty as to general market price levels for equity securities in Japan, declines in which may require Hitachi to write
down equity securities it holds.
The factors listed above are not all-inclusive and are in addition to other factors contained in Hitachi’s periodic filings with the
U.S. Securities and Exchange Commission and in other materials published by Hitachi.
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Copyright © Hitachi,Ltd.2005 All rights reserved