Douglas Woo wasn't supposed to be a major player in TVs.
In 2002 when he formed Westinghouse Digital Electronics and became its president, the company had about a dozen employees and a lot of people thought that the plan was to sell generic TVs on the strength of the name alone.
Flash forward. Westinghouse is now one of the larger LCD TV brands in North America, and it recently entered Japan and China. The company has also penetrated the commercial market for computer monitors, landing sales to the likes of Halliburton. The secret, says Woo, has been Westinghouse's ability to combine the marketing techniques of the consumer electronics world with the hard-boiled efficiencies of PCs. The company, he adds, also participates extensively in the actual engineering of its sets, too, which explains why Westinghouse has managed to get ahead of competitors in some high-definition features.
Woo sat down with CNET News.Com's Michael Kanellos to discuss price declines in TVs, mass merchandising and the inevitable world domination of LCDs.
Q: Three years ago, a lot of people scoffed when Westinghouse and other people jumped into LCD TVs. The latest data shows you're one of the largest selling brands in the U.S. Woo: It's kind of a validation. When we first launched, LCD TV wasn't very strong. People were still saying "Is it plasma or LCD?" and "Is it going to really replace CRT?" And there wasn't much shelf space. So we came in and told the retailers, "This is the next big thing," and we told them that we weren't your normal operation and we weren't just buying products in Asia.
So how did you do it? When you started out you only had about 12 employees, so everyone assumed you were just leveraging contract manufacturers. Woo: First of all, we have very strong relationships with panel makers. That's not only to ensure supply and see the direction of pricing in the industry, but it also gives us the ability to work from a product marketing and engineering standpoint deeply into the supply chain.
That's what we told retailers early on, that we had the ability to adjust to the marketplace really quickly because we control so much of the resources in between.
For example, when we released our 42-inch (LCD TV), it was from a new panel from Chi Mei (Taiwan's Chi Mei Optoelectronics). Typically, the panel maker comes up with a panel module, then TV guys work on it for six to eight months and then come up with a product. For us, it was a co-launch--they launched the panel, we launched a TV. And that's because we had a really deep R&D relationship. And that's what we told retailers early on, that we had the ability to adjust to the marketplace really quickly because we control so much of the resources in between.
Our products are typically ahead of the marketplace. We launched 1080p (monitors) last year, not this year. Now, we go all the way from entry level up to 52-inch 1080p. It's a beautiful, beautiful product. And now this year, we launched into the commercial market to sell everything from basic 32-inch and 26-inch monitors up to an 82-inch digital signage piece, up to quad, full HD 8-million-pixel displays for oil and gas exploration. (Editors' note: "Quad" refers to the fact that there are four times as many pixels as in a 1080p TV.)
You've only got so many engineers, so how do you figure out what kind of research they should tackle? Woo: We have, I don't know, 20 to 25 engineers working directly on staff. We typically concentrate on the architectural side. We architect the product, then we work with each of the component suppliers in order to affect a way they create the component. We work with Chi Mei, the video-processing guys.
If you look at all of our products, you'll see we have adopted the Westinghouse spine design. (Editors' note: In this design, all of the output connectors are lined up in a spine behind the screen of the TV and are housed on the same board.) It's a single-board design. When we first started in this business, no one did that. Pull apart a TV from a competitive, tier-one supplier from back then and you'll probably see 12 to 13 boards in back.
If you pull apart a TV from Westinghouse what you'll see is a single board in the spine. That structure improves wire management, it improves video performance by reducing signal path and it makes the manufacturability of the unit and serviceability of the unit much better. We can depopulate (i.e. remove) particular chipsets and populate the board with new chipsets to take advantage of the either higher performance or lower costs.
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