Samsung stops selling consumer electronics in Japan

Poor profitability has made Samsung Electronics Co. stop selling flat panel televisions and other consumer products in Japan, the company announced Friday.

Samsung has emerged in the past decade and a half as a global giant in consumer electronics, taking on and even beating Japanese rivals in places such as the United States and Europe.

But penetrating the competitive Japanese consumer market, home to rivals such as Matsushita Electric Industrial Co., Sony Corp. and Sharp Corp., appears to have been a considerable challenge.

"We judged direct sales to individual consumers are less profitable than business-to-business sales," Lee Eun-hee, a Samsung spokeswoman, said of the reasoning behind the decision.

Samsung sold LCD TVs, DVD players, MP3 music players and other items in Japan via the Internet, but stopped at the end of October, Lee said. It had ceased sales in retail outlets in August last year, she said.

Samsung will sell flat screen computer monitors directly to businesses and will continue to sell components such as memory chips and liquid crystal displays, she said. The company will also keep supplying mobile phone handsets to Japanese telecommunications company Softbank Corp., she said.

Last year, Samsung's sales of consumer electronics in Japan via the Internet and retail outlets came to less than 1 percent of the company's total sales in the country of 1 trillion yen (US$9 billion; EUR6.1 billion), said Samsung spokesman James Chung.

Since 2004, Samsung has produced LCD panels at a joint venture with Sony to meet strong demand for flat screen TVs, which has soared in recent years as consumers have switched to the sleeker versions.

Analysts, who emphasized that the move would have no impact on Samsung's bottom line, said the dominance of Japanese manufacturers on their home turf meant the company faced serious marketing and brand challenges despite the quality of its products.

"I think for flat panel TVs profitability will be better in other regions than Japan," said James Song, an analyst at Daewoo Securities Co. in Seoul.

Subscribe to Pravda.Ru Telegram channel, Facebook, RSS!

Author`s name Angela Antonova