Like all Japanese electronics manufacturers, Panasonic has suffered a dramatic collapse in sales of its most profitable products - TVs and components - as a result of brutal competition from more agile foreign competitors, especially Samsung. That threat added new urgency to a steady restructuring that has been going on for several years. In fact, until a change of name in 2008, Panasonic was just one of the brands controlled by what was then Matsushita Electric Industrial, alongside National, JVC and Technics. Together these brands made Matsushita the world's biggest consumer electronics company for much of the 1990s and early 2000s (ahead even of local rival Sony). However, the marketplace began to change dramatically mid-2000s, forcing MEI to change its strategy. To avoid the confusion caused by its multiple brands, the group announced in 2008 that it would change its corporate title to Panasonic Corporation, and phase out its smaller brands. The group still makes a wide variety of consumer electronics products - including Viera flat-screen TVs and Lumix digital cameras - but it sees a brighter future in less high-profile areas such as automotive components, domestic energy systems and B2B technology solutions.
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Free for all users | see full profile for current activities: The company was founded by Konosuke Matsushita in 1918 as Matsushita Electric Housewares Manufacturing Works. Its first product was a humble electric plug, but by the close of the 1920s, Matsushita was also turning out battery-powered bicycle lamps, electric irons and other small appliances, and changed its name to Matsushita Electric Manufacturing Works. In the 1930s, Matsushita moved into the manufacture of batteries, and spun off the electric lamp business as National, the forerunner of the Panasonic brand.
The Second World War brought inevitable disruption, but by the start of the 1950s Matsushita had expanded its range to produce washing machines, televisions, refrigerators and other larger household appliances, many of them exported to the rapidly expanding US market. In 1953, the company opened a New York office, and the following year acquired control of the Japanese subsidiary of RCA Victor, the Japan Victor Company generally known as JVC. Osaka Precision Machinery Co, later to become Matsushita Seiko, was established in 1956. The Panasonic brand was first introduced in Japan in 1955 for audio speakers, and launched internationally in 1961. By the mid-1960s the company was Japan's largest manufacturer of domestic appliances.
That decade, MEI took its first steps into video technology. The company had been producing tape recorders since the 1950s, and began to turn its attention to recording video output. The first Matsushita video tape recorder was developed in 1964, but the real advances came from the group's subsidiary JVC. Originally set up in the 1920s to make records and phonographs for the Japanese market, JVC shifted its focus towards video systems during the 1960s. In 1976, the company launched its own Video Home System (VHS) for videotape, in competition with a rival format developed by Sony, called Betamax. A fierce war ensued between the two formats, especially after Panasonic put its full weight behind VHS, and that system quickly achieved prominence in Europe. However, Sony's Betamax struggled on in the US. At the close of the 1980s, both companies raised the stakes by acquiring US-based film studios in an attempt to win the war by owning video libraries they could market exclusively in their own format. In 1990, MEI bought the MCA Group, which included the Universal Pictures business. A few years later, the Betamax format was effectively terminated by Sony. However MCA Universal was never a particularly comfortable fit, and MEI sold on an 80% shareholding in the business to Seagram in 1995, making a huge loss on the disposal. (The remaining shares were sold to Vivendi Universal in 2006).
In the mid-1990s, MEI turned its attention to the new DVD format, as well as to digital television. The company shipped the first DVD player in 1996, and exported its first digital TVs to the US in 1998. In 1999, Matsushita became one of the partners in British company Symbian, launched by handheld computer group Psion to develop software for next-generation mobile telephones. Motorola, Nokia and Ericsson also all adopted the operating system in their products. Also in 1999, Panasonic unveiled the WiLL PC, part of its involvement in the unique WiLL marketing project in which a group of leading Japanese companies agreed to market a range of lifestyle products under a shared brand.
In 2001 Matsushita merged its LCD display and cathode ray tube (CRT) parts purchasing businesses with those of Toshiba in a joint venture. The group also closed a number of loss-making subsidiaries around the world, including mobile phone and fax machine operations in the UK and other countries. It later merged its CRT manufacturing operations with Toshiba as well. In 2003, in a bid to focus and consolidate its portfolio, the group bought back full control of several subsidiaries previously part-floated, including its battery manufacturing, lighting, mobile communications and other businesses. PanaHome, a division manufacturing and marketing prefab housing, and office automation subsidiary Matsushita Electric Works, were merged into the main group in 2004. See full profile for current activities
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