Strongly Suggest INCJ (Innovation Network Cooperation of Japan) to acquire Vaio

In the global market of electronic devices, Japanese electronic part manufacturers have been challenged by their counterparts outside Japan such as Lenovo (Laptops and Desktop Computers), and Samsung (OLED Displays, Batteries and Memory Chips) for years. Japanese Companies have developed many advanced technical solutions. However, starting from last decade, China, Taiwan and South Korea have effectively supported their electronic industry. The cost of production in China, Taiwan and South Korea was lower than that of Japan. Competitors from these countries had quicker decision – making process, which was essential for developing popular products in the fast – changing market of smart electronic technology. Apple had begun developing portable digital music players when Sony was still modifying its Compact Disc (CD) and Mini Disc (MD) player products [1]. That resulted in loss in business of many Japanese Companies including JDI. Some companies such as Fujitsu Client Computing Limited (FCCL) [8] and Sharp have been acquired by their foreign competitors.

For increasing market share, apart from development of suitable technology for changing market trends and production cost reduction, it is also essential for more end users and companies to feminize with high quality of Japanese electronic products. Innovation Network Cooperation of Japan (INCJ) has been an important shareholder of some major Japanese companies in the market of electronic devices such as Renesas Electronics (Renesas), JDI and JOLED Inc. (JOLED). Renesas and JDI are also major suppliers of the global market of electronic devices. If more companies know more about their products, it will be helpful for them to increase their income. At the beginning of operation of Vaio Corporation (Vaio), a small but competitive manufacturer of laptops and other electronic appliances, Japanese Industrial Partners (JIP), its parent company, has planned to make an IPO for Vaio or sell Vaio to others for earning money [2]. That provides the Japanese government with a chance to buy Vaio from JIP.

Firstly, by acquiring Vaio, new technology from Japan Companies can be more easily promoted by Vaio products. Among various products of Vaio, Vaio Z is designed for advanced users. Many of parts such as CMOS image sensors (CIS) and Display, used by Vaio Z, are developed by Sony and JDI respectively [3], which are Japanese electronic part manufacturers with technical advantages. By adapting other new solutions such as Transparent Glass-Based Capacitive Fingerprint Sensor (Developed by JDI for flexible non-display applications) [4, 5] and Painted OLED Panel (Developed by JOLED, OLED Panels made by inkjet printing can be more cost – performance effective due to its higher material efficiency than that of thermal vaporization method, used by some major OLED Panel suppliers such as Samsung) [6, 7] into Vaio Z and other products, users and other companies can be surprised by wonderful experience, created by new solutions from Japan adapted by Vaio Z. That will be helpful to attract more companies to use hardware, developed by Japanese part manufacturers.

Secondly, because of good profitability of Vaio, more income can be earned by INCJ if it becomes the main shareholder (with more than 50% of Vaio shares). Due to small company size, diverse product line and active market exploration, its profitability has been greatly improved in 2 years [9]. Vaio has only 250 employees [2] but FCCL employs 1128 staffs [8]. Vaio also has a more simplified computing product line than that of FCCL. Apart from laptops, Vaio also develops other electronic products such as ATOM Robots [10] and Moff Band (Smart Slap – On Bracelet) [11]. Vaio also actively explores new markets such as Taiwan, China, Brazil and Argentine in about three years.

Thirdly, due to wide diversity of Vaio products, all – round feedback can be received by Vaio staffs, who can directly communicate with their partners. These partners provide Vaio engineers with electronic devices. That results in quicker response to market trend for partners of Vaio.

Fourthly, unwanted software such as Superfish harvests data or includes security loopholes; posing cyber threats to PCs and smart devices. Hillary Clinton Email Controversy has also reminded users of importance of secured devices and systems on Internet Safety. Lenovo has been the top PC manufacturer in Japan since 2011. However, because of the Superfish Controversy [13], US Federal Trade Commission (FTC) has ordered Lenovo to get customers’ consent before installing software gathering data of injecting advertisement [12, 13]. Lenovo has also been requested to carry out a third party audited risk assessment program for software installed on its products [12, 13]. Apart from Superfish, it is expected that other security controversy about software such as Lenovo Fingerprint Manager [15] and Lenovo Service Engine (LSE) [14] has made many users doubted whether Lenovo can offer secured PCs to them. Unwanted software had also been discovered from products of some other popular PC brands [16, 17 and 18]. It is essential for Japanese authority to actively help their citizens to obtain secured laptops and smart devices. By acquiring Vaio, it will be easier for INCJ to carefully monitor the production of Vaio products. That results in provision of secured systems for Japanese users and firms.

Finally, it is beneficial for INCJ to acquire Vaio. The numerous advantages of Japanese electronic parts can be fully used to enhance the computing power and user experience provided by Vaio.

Reference

[1] https://buzzorange.com/techorange/2017/03/17/japanese-company/

[2] http://www.yomiuri.co.jp/fukayomi/ichiran/20170420-OYT8T50040.html?page_no=5

[3] https://vaio.com/campaign/reason_z/

[4] http://www.j-display.com/english/news/2018/20180123.html

[5] https://www.eetimes.com/document.asp?doc_id=1332890

[6] https://www.j-oled.com/news-eng/2018-1-5/

[7] https://www.j-oled.com/technology-e/joled_tec_print-e/

[8] http://www.fujitsu.com/global/about/resources/news/press-releases/2017/1102-01.html

[9] http://tech.sina.com.cn/it/2016-06-07/doc-ifxsvenx3572310.shtml

[10] https://vaio.com/magazine/atom/

[11] https://vaio.com/ magazine/new_business/vol2.html