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Toshiba CEO Hisao Tanaka was recently quoted in the Wall Street Journal as saying he wouldn’t give up on the company’s money-losing television and computer business units.

Toshiba has lost over $500M in each of the past two years in its television business, and its personal computer operations are also coming up short as more consumers turn away from laptops in favor of tablets and large smartphones.

In terms of market share, Toshiba’s TV revenues definitely fall into the “other” category. NPD DisplaySearch’s final numbers for 2012 show Samsung with nearly 28% of worldwide TV shipments, followed by LG at 15% and the grouping of Sony, Panasonic, and Sharp combined making up 19%.

That leaves 38% for “other” and that group includes third-tier brands form China, which are growing rapidly and taking more market share every year. The last time Toshiba had any substantial market share was about two years ago when they captured 7% of the worldwide TV business. But they’ve fallen to #6 behind Sharp, who is barely hanging on to a 5% market share.

Tanaka told the Journal that Toshiba would shuffle around some employees and cut back on the number of TV models it produces. Readers may recall that Toshiba made a big splash a couple of years ago with autostereo 3D TVs at CES and continues to demo them, even though demand for 3D TVs has largely dissipated. Toshiba is also a player in 4K, with a 55-inch offering and a new 84-inch (LG Display) TV coming to market.

Many analysts (myself included) fully expected Toshiba to throw in the towel after Hitachi pulled the plug on its TV operations more than a year ago. You can still find Hitachi TVs in some retail chains, but these are merely OEM products made in Taiwan or China that have the Hitachi name slapped on them. Toshiba was expected to do the same since they do not manufacture LCD glass for televisions but buy it from various manufacturers.

What keeps the company going are profitable operating units that manufacture flash memory and power equipment, according to the WSJ story. You may recall that Toshiba did at one time manufacture small LCD panels and has also dabbled in SM OLED manufacturing, so the company is quite diversified and still able to overcome the losses from TV manufacturing and sales. And Toshiba even brought out a line of 10-inch tablets in 2011, named “Thrive.”

That’s not to say that the company is willfully stubborn. Not that many years ago, Toshiba did throw in the towel on front projectors. The company had a full line of home theater and business projectors as recently as three years ago, but couldn’t carve out enough market share to justify the expense and effort, so they simply walked away from the business.

Does Toshiba really have a trick up its sleeve? Can it become profitable again with televisions? That’s unlikely, as all of the major Japanese TV brands are trying to reverse flows of red ink, and some of them even manufacture their own LCD panels.

Tanaka said in the interview that he thinks TV sets and computers are an important part of creating “smart communities” and that health care will be a big part of the company’s focus in years to come. Toshiba certainly hasn’t given up on innovation (witness their autostereo and 4K projects) and they still have strong brand recognition worldwide.

Who knows? Maybe the winds will change direction?

Posted by Pete Putman, August 9, 2013 8:05 AM

About Pete Putman

Peter Putman is the president of ROAM Consulting L.L.C. His company provides training, marketing communications, and product testing/development services to manufacturers, dealers, and end-users of displays, display interfaces, and related products.

Pete edits and publishes HDTVexpert.com, a Web blog focused on digital TV, HDTV, and display technologies. He is also a columnist for Pro AV magazine, the leading trade publication for commercial AV systems integrators.