Barco’s Projection Systems Division

Barco’s Projection Systems Division (BPS) designs and manufactures sophisticated video projectors for industrial applications.  While we didn’t invent video projection we have played a key role in niche market development of the technology, specifically through the differentiation in the commercial market of video, data, and graphic lines based on scan rate.  In a field with limited competition, new technological advancements can have a significant impact when they are introduced quickly to the market.  Competitive advantage shifts to those who execute on research and development, control costs and maintain high quality.  Up to this point we have held the advantage through aggressive upgrades to our scan rates, but Sony’s recent announcement of a soon to be released superior graphics projector (1270) finds us with no competing model ready for market.   In light of this threat to our market position we have three strategic options:  1) Use the BD700 development as a spring board to develop a next generation graphics projector (BG700), competitive with Sony’s 1270 but with inferior technology.  2) Turn all attention to developing a graphics projector (BG800) which outperforms Sony’s 1270.  3) Continue to develop our data projector BD700 with an increased frequency of 64 kHz, higher than what any other competitor will be able to bring to market quickly.

BPS’s marketing strategy will highlight our reputation and continued commitment to quality, placing emphasis on our market leading technology. Sony is known for being a mass production company focused on the consumer market, rather than a cutting edge developer with a focus on quality.  Sony’s advertisements for the 1270 will attempt to rebrand them as a pioneer of market leading technology. BPS’s emphasis will counteract these claims, highlighting our trusted reputation for a quality product.  Corporations and business professionals will be our target audience.  Advertisements will run on TV shows such as CNN and nightly news.  Magazine and newspaper advertisements will run in professional publications such as the Wall Street Journal, the Economist and technology magazines.

We consider Sony a threat in the data segment and expect their next product to be a higher performing data projector, for release in the fall of ‘89, and also expect them to enter the graphics segment in late ‘90.  This development exposes the relationship we entered into with Sony in 1985, where we subcontracted with them for our tube production, as a direct threat to our future success.  This contract had helped BPS keep in lockstep with Sony’s advancements in tube technology, but it also created a dependency on Sony.  We justified this relationship “on the assumption that Sony would respect our (BPS’s) vision of the marketplace”.  By relying on Sony, instead of obtaining an independent supplier to produce market leading technology, BPS has provided them with a significant competitive advantage.  Sony has control over timing of technology releases, the design of new tube technology, and insight into BPS’s development schedule.  This was exposed when Sony introduced a superior 8” tube which had a new adaptor we had not seen before for the 1270.  Sony had a head start designing their product with the new adaptor, working off of a five year product life cycle, which caught BPS and the rest of the market off guard and unprepared.