Videocon to acquire Onida - Rumor
November 5th, 2007


An interesting news has reached our ears from the industry circles. As part of the rationalisation going on in the Home appliances segment, Videocon may be about to acquire Onida. This is an unconfirmed news and we want to analyze for a moment why there could be a possibility.
Ever since the market opened up to foreign players, Indian companies had found the going increasingly tough. They were not able to compete with the costs and offerings from multinational giants like Philips, Samsung, LG etc.
In the mid 80’s there were quite a few TV manufacturer in India. ECL, Dyanora, Solidaire, Weston, Crown and Optonica were some of the familiar brands which shut their operations in mid 90’s, because they were no longer competitive nor had the marketing edge to sell their products in the Indian market.
In this situation, some of the players made a bold move to have technological tie ups with foreign companies. Some of the prominent partnerships established were:
- BPL - Sanyo ( in our earlier article [see below] we mentioned that this is now more than just a technological tie-up. Sanyo and BPL are now equal equity partners in the JV)
- Onida - JVC
- Videocon - National Panasonic
These three companies were pretty dominant in Indian market for quite some time. Philips was a late entrant in this scene and managed to capture a significant portion of the market.
But what really changed the situation was the entry of Samsung and LG. These Korean companies were very aggressive with their marketing. Their local presence and strong brand appeal were able to attract a lot of customers and we believe LG is now the leader in the Indian Television market.
Videocon is now focused on communicating their “Indian Multinational” image with recent acquisitions like Thomson, Kenstar, Kanchan foods etc. They are not only manufacturing and selling televisions under their own brand name, but are also acting as Equipment Manufacturers for companies like Sansui and Toshiba.
Onida with their memorable ad campaigns were a force to reckon in the past. Now those golden days are long gone, when consumers used to associate with their “different” ad campaigns.
We of course are not in a position to confirm anything on this matter, but the decision could be welcome to both groups in order to pool their strengths so that they can take on the competition from Korean Giants - Samsung and LG.
Pretty much the same thing had happened in the mobile phones sector were late entrants like Nokia created a huge market share for themselves and left no choice for the other players but to re-strategize their game.
In the mobile space, Sony tied up with Ericsson, Benq tied up with Siemens and the former is now a formidable competition for Nokia along with the revamped Motorola.
Also read our coverage on televisions :
Television - A preview on offerings
Television Brands in India - Part 1
Television Brands in India - Part 2
We welcome your comments and views on this topic.


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