Barco Case Write-Up

Barco Case Write-up

Back to 1930s and 1940s, Barco N.V. was a manufacturer of radio broadcast receivers and television receivers. During 1950s to 1970s, Barco grew very fast and developed broadcast monitors and professional video equipment. Due to the global recession in late 1970s and 1980s, Barco made their right decision to switch their focus from consumer to industrial markets. Barco has been very successful in this distinct projection area because it has significant market strategies. Barco has been the leader of data and graphics for more than half a century. It has the most market share in the Europe, North America, and even Far East Asia. Barco tried to provide great customer services in order to build a strong brand name and high reputation. Barco also has been negotiated with some reliable suppliers to keep their production chain working well.

The most competitive company in data and graphics segment is Sony. Sony has some smart market strategies as well. Sony fixed their position in this market accurately. It divided its products into two areas. 50% of their products would be introduced to the market as their own products, and the other 50% would supply to other companies. In the case, Barco was seriously threatened by Sony's new "superdata" projector –1270. Barco overestimated itself, and underestimated Sony's new techniques. Barco thought it was the leader, Sony was always the second and it would follow Barco's pace to introduce its new product which could compete with Barco's new product. Barco's "vision" of the marketplace was shortsighted. As a supplier of Barco, Sony's high technic should not be ignored. Barco just follow their pace based on their own assumptions of Sony's new product without a deep research and investigation. On the other hand, Sony as a supplier of Barco, it knows Barco's capability and components exactly. It would invent something has a better performance than Barco's projector.

As Sony's 1270's appearance at the Siggraph trade show in Boston in August 1989, Barco was totally shocked. Sony's 1270 has much better performance than the Barco's BD600 which was expected to be a direct competitor and even better than BD700 which was still in developing process.