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Metropolitan Musings: Panasonic Goes Gaga Over Google

Tokyo: Google and Apple are the tech brands du jour right now, something not lost on Panasonic as it seeks to consolidate its brand globally. On January 6, Panasonic and Google announced that they are pursuing a television capable of showing Google’s YouTube videos and Picasa photos. This made the news, but is it really newsworthy? At first glance, such a move seems like a stroke of genius, converging computer content with the living room television: the long-sought holy grail in modern media of marrying content and delivery. In reality, it’s an idea that will probably never get far, but served the extremely useful purpose of injecting Panasonic into the news cycle—joined at the hip with Google—at the beginning of the annual International Consumer Electronics Show (CES) in Las Vegas from January 7-10, the largest trade show in the industry. Not coincidently, Panasonic President Toshihiro Sakamoto was one of the six keynote speakers this year.

Simultaneously, they were also trying to beat Apple to the punch in the event that Apple CEO Steve Jobs were to announce something revolutionary at the MacWorld Expo on January 15. It turns out that Panasonic did not need to announce anything extraordinary as Apple’s key announcement, the MacBook Air—much more evolutionary than revolutionary—has received only a lukewarm reception from macheads.

Just four days after the Pansonic-Google press release, Panasonic was in the news again as its owner, Matsushita Electric Industrial Co., announced that is was going to retire its corporate name and globally re-brand its Panasonic (international brown goods) and National (domestic white goods) brands under the singular corporate name of Panasonic Corporation by March 31, 2010. This makes good business sense as Pansonic has been the global face of Matsushita, whereas National is primarily a domestic brand. Only in Japan and China, where Matsushita originally gained prominence in 1978 when company founder Konosuke Matsushita agreed to Chinese President Deng Xiaoping’s plea to help develop the Chinese electronics industry—think Pepsi’s Khrushchev moment—does the Matsushita name maintain any brand equity. Even in Japan, the company is known variously as Matsushita, Panasonic, National and/or MEI, fragmenting the brand and greatly reducing its impact. As Japan’s shrinking population continues to produce weak domestic spending, coupled with looming recession, Panasonic must become an even more globally-centric company to continue growing. Clearly, re-branding under the Panasonic name is a sound move, as was generating buzz about the company just days before this announcement and the week of the industry’s biggest global gathering.

Additionally, this name change symbolically passes the torch from former Matsushita CEO Kunio Nakamura to current CEO Fumio Ohtsubo. Though Ohtsubo-san took the reigns at Toshiba in July 2006, the shadow of his predecessor looms large over the company. As old Japan hands can tell you, the legacy management of former CEOs live on in legend long after their retirements, especially in the case of Nakamura-san who was beloved for turning the company around. In addition to giving Panasonic a consolidated identity, the name change is symbolically sending the message that Ohtsubo-san is the man solely in charge now as the company begins its 90th year of existence. On the heels of Nakamura-san’s company restructuring, Ohtsubo-san must continue to nurture creativity and innovation to grow the company.

Back to the Google-Panasonic TV. What are the chances of this happening? As much as Panasonic would like the market to think that they are developing a technological purple cow, the chances are probably slim to none that this will actually be a success. Almost all user-generated Internet video uses Flash encoding whereas digital televisions mostly use MPEG-2 encoding. Therefore, these televisions will come with some type of internal CPUs, which for starters, is not a core competency of either Panasonic or Google. Granted, this can be done relatively easily, though not inexpensively, by finding a partner or supplier. But a CPU-equipped television would not be restricted to showing only YouTube videos or Picasa photos so viewers could just as easily watch other internet-hosted videos and pictures thereby rendering any YouTube exclusivity moot. While Google may ascribe to the theory that a rising tides raises all boats, lack of exclusivity would seem not to motivate Google to invest significant money into this project. At this point, Google wants exclusivity content, but doing it will be a a challenge.

Consumers might have complaints, too. In current form, YouTuby looks like crap on maximized PC screens, so, logically, would look even worse maximized on a larger television screen. And the aforementioned internal CPU will add significant cost to these TV sets. There does not appear to be much demand given these issues.

Certainly, there will be some type of converged television offering exclusive content sometime in the future, possibly even sooner than later. Whether it turns out to be acTVila, Apple TV, Google-Panasonic or something else, no one yet knows. However, do not hold your breath on Panasonic. More than anything, this smells of PR news generation with very little substance. Given that Google is golden right now, Panasonic is happy to be mentioned in the same breath in hopes of enhancing both their brand awareness and image. On that front, they have accomplished their goals. All in all, a good month for Panasonic: a new, highly-recognizable brand identity and lots of free publicity, especially within the blogosphere, by riding the coattails of Google.

Recommended Reading:

The Google Story, 2006, by David Vise and Mark Malseed: The Google story.
Panasonic, by Francis McInerney, 2007: An account of former CEO Kunio Nakamura’s restructuring of Panasonic at the beginning of the millennium.
Profit from the Core, by Chris Zook, 2001: A theory of growth strategy based on analysis of 2000 companies over 10 years concluding that core competencies offer better long-term growth than diversification.
Beyond the Core, by Chris Zook, 2004: A follow up to his first book, Profit from the Core, that espouses adjacent growth from core competencies.
Purple Cow, by Seth Godin, 2003: The marketing guru’s explanation of being remarkable, i.e. clearly differentiated, or invisible, i.e. commoditized.

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