LeEco to Acquire Vizio for $2B - AVS Forum | Home Theater Discussions And Reviews
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post #1 of 72 Old 07-26-2016, 11:25 AM - Thread Starter
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LeEco to Acquire Vizio for $2B

Amid rumors swirling around online, today it's official: Chinese Internet ecosystem company LeEco will acquire Vizio's hardware and software business, including all technology and intellectual property, for the princely sum of $2 billion. Vizio's data business, Inscape, will spin off and operate as a separate, privately owned company.


LeEco founder and CEO YT Jia (left) and Vizio founder and CEO William Wang shake hands at a press conference announcing the merger of their two companies. (Photo by Jeff Lewis/AP for LeEco)

I had not heard of LeEco before, and I wondered what an "Internet ecosystem company" might do. According to the press release, "LeEco is a leading global technology company that provides breakthrough experiences through its open, integrated ecosystem of streaming content, platforms, and smart devices that fit perfectly into a broad spectrum of lifestyles. LeEco opens new opportunities for consumers by offering a wide array of next-generation connected products—including smartphones, TVs, bikes, and cars—and content spanning sports, film, and live entertainment. LeEco was recently named one of Fast Company's 2016 Most Innovative Companies, and Alphr's Best of Mobile World Congress—Most Innovative Company."

Okay, that sounds like it might be a good match with Vizio. YT Jia, LeEco's founder, chairman, and CEO, agrees, saying, "LeEco believes in breakthrough technologies, a complete ecosystem, and disruptive pricing. Acquiring Vizio is an important step in our globalization strategy and building our North American presence. From its inception, Vizio introduced a disruptive business model that changed the industry and aligns with our vision of breaking boundaries to deliver consumer-focused products, software, and services."

Of course, Vizio is no stranger to disruptive business models, having shaken up the smart-TV and soundbar markets with high-quality products at surprisingly low prices ever since its founding in 2002. And the company knows a thing or two about ecosystems of hardware, software, and services; the most recent example is Vizio's new SmartCast system, which integrates the delivery and control of content across various devices.

According to the press release, "The acquisition benefits both companies with Vizio offering LeEco a steady installed base of users and a brand that is both popular and successfully distributed throughout major North American retail channels. LeEco provides Vizio immediate global scale to bring its innovations to consumers worldwide. Like LeEco, Vizio shares a similar vision of creating premium products with the latest innovations and making them accessible for everyone—from budget-minded students to custom home-theater cinephiles—without sacrificing quality or performance."

The sale is expected to close during the fourth quarter of 2016, subject to the customary conditions. Vizio's executive management team will remain in place and continue its operations as an independent subsidiary from its headquarters in Irvine, CA. Also, Vizio products will continue to be sold through its existing distribution channels and supported by the same North America-based customer service.

Change is always disruptive, but it seems like LeEco and Vizio have a lot in common. Of course, time will tell, but I look forward to seeing what this merger might mean for Vizio products in the future.

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post #2 of 72 Old 07-26-2016, 11:47 AM
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just give me HDR10 and then they can be whoever they want :P
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post #3 of 72 Old 07-26-2016, 12:18 PM
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It says they will continue to operate as an independent subsidiary, so that's good. But I wonder if it means any change in plans for future firmware or updates to existing TVs. If I buy a P series now I want to make sure it continues to receive updates.
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post #4 of 72 Old 07-26-2016, 12:31 PM
 
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Not sure how I feel about this... not a good feeling atm..
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post #5 of 72 Old 07-26-2016, 12:51 PM
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Top echelon execs cash out and they couldn't give a crap about consumers i.e.; suckers!
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post #6 of 72 Old 07-26-2016, 12:52 PM
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Quote:
Originally Posted by xtremesniper View Post
It says they will continue to operate as an independent subsidiary, so that's good. But I wonder if it means any change in plans for future firmware or updates to existing TVs. If I buy a P series now I want to make sure it continues to receive updates.
Believe me they wont operate independent for long. If anything they keep the name Vizio and maybe a design studio in Ca. but it will all change. I have been through a few acquisitions and the company getting acquired never stays independent for more than an year or so. Then all the C-levels get replaced. It's just how it works.
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post #7 of 72 Old 07-26-2016, 01:25 PM
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Originally Posted by ANEWMadrid View Post
Believe me they wont operate independent for long. If anything they keep the name Vizio and maybe a design studio in Ca. but it will all change. I have been through a few acquisitions and the company getting acquired never stays independent for more than an year or so. Then all the C-levels get replaced. It's just how it works.
It kinda reminds me of Hisense buying Sharp America. With all these display company's being bought out by a lesser known company I just don't get that warm sense of continued support that is needed by consumers.
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post #8 of 72 Old 07-26-2016, 01:36 PM
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Well the Billions we keep on sending China doesn't surprise me, they will never need to invade another country, they just will keep on buying everything up! LOL The ironic thing is corporate greed, runs the same no matter what the nationality is, now they can replace all the humans that build the TV's with Robots and then the people they lay off won't be able to afford their inexpensive TVs... Doh!
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post #9 of 72 Old 07-26-2016, 01:43 PM
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Wow this is some huge TV news. I hope this does not mean lousier TV sets over the next few years.

And they sold for $2B!?!?! That sure does mean a whole lot of TV sales per year to justify that price.
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post #10 of 72 Old 07-26-2016, 02:03 PM
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Congrats to Wang, who bet everything, worked hard to build a company and now will be rewarded handsomely for doing so. However, in every other way, this is a sad day.

LeEco is the same company that is behind Faraday Future.
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I wonder if this means that the Vizio brand will be back in full force at CES next year??
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Originally Posted by DDailey View Post
Top echelon execs cash out and they couldn't give a crap about consumers i.e.; suckers!
Right. And 2B? That's all? Really?
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LeEco of my Eggo.

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LeEco to Acquire Vizio for $2B

Quote:
Originally Posted by kleenex View Post
I wonder if this means that the Vizio brand will be back in full force at CES next year??


Google LeTv they already have a presence at CES



http://www.xiaomitoday.com/letv-max7...ved-announced/


http://sina.com.hk/news/article/2015...html?cf=o.news

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post #15 of 72 Old 07-26-2016, 03:30 PM
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There's almost no way this is good for consumer. Vizio was the only brand with good technology at lower prices, were they not making money? There's very little incentive for the acquiring company to keep and grow the business in many cases.
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post #16 of 72 Old 07-26-2016, 04:52 PM
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I don't get all the consternation and gnashing of teeth. Vizio didn't make their own TVs. They mostly wrote specs and had their ODMs in Asia make the TVs they put their name on. So they got bought by a bigger Chinese company... What's the big deal?
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post #17 of 72 Old 07-26-2016, 05:12 PM
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I don't get all the consternation and gnashing of teeth. Vizio didn't make their own TVs. They mostly wrote specs and had their ODMs in Asia make the TVs they put their name on. So they got bought by a bigger Chinese company... What's the big deal?
Well it was based in Irvine Cal, not to be confused with China... Chinese are very good at buying stuff and cutting the crap out of corners in order to make it cheaper, I guess no different that most of the other manufactures these days. LOL Might as well put a for sale sign up in the States and just start selling off chunks of lands to them! Our idiots in office just turn a blind eye and wonder what the middle class are disappearing in the US and that their is no good new jobs... You are correct Vizio basically was the largest seller of LCD and sets in the US, but they had their panels made buy just about anyone, and when you bought one of their sets it was a gamble on what panel you got, some great some not so great...

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Well it was based in Irvine Cal, not to be confused with China...
And as of today those people are all unemployed right? I'm sure their jobs just vanished into thin air the minute the announcement was made...

Quote:
Chinese are very good at buying stuff and cutting the crap out of corners in order to make it cheaper, I guess no different that most of the other manufactures these days.
Vizio's ODMs made their TVs in China. So, what you're saying now that Vizio is owned by a Chinese company they're going to do what they've been doing all along?
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post #19 of 72 Old 07-26-2016, 05:41 PM
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And as of today those people are all unemployed right? I'm sure their jobs just vanished into thin air the minute the announcement was made...


Vizio's ODMs made their TVs in China. So, what you're saying now that Vizio is owned by a Chinese company they're going to do what they've been doing all along?
Stereodude: Lighten up Frances, can't you see the big hint of sarcasm in my post! But in General the global economy has never been a fair one, just keep on coughing and say it doesn't hurt when you have your next prostrate exam! LOL

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post #20 of 72 Old 07-26-2016, 07:12 PM
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Originally Posted by Stereodude View Post
And as of today those people are all unemployed right? I'm sure their jobs just vanished into thin air the minute the announcement was made...


Vizio's ODMs made their TVs in China. So, what you're saying now that Vizio is owned by a Chinese company they're going to do what they've been doing all along?
You do understand what an ODM is correct? The parent does all engineering, obtains all regulatory approvals etc on the product. All major components are specd by the parent and only those components and the designated mfg p/n can be used by the ODM. Only off the shelve penny parts can be specd by the ODM but the part value must be a match. All software is designed by parent and ODM cuts in said software after parent approves mfg load.

BOMs and all engineering changes weather ODM or parent initiated must be approved by parent typically using a PLM system like Agile.

Parent owns all intellectual property, software and controlled parts. The ODM/JDM is basically an assy house for the product but in some cases may have some minor eng input.

This is a far cry from a company buying another. That company now takes control of all things I've listed as owned by parent. I'm sure the new owners will retain much of the engineering staff for now as it takes over a year to get on track and three to five years to get ERP systems and BOMs and items converted over (I'm in the midst of this in my own company)

This is a far cry from they are building it in China anyway so who cares.. And on that note what nameplate will be on my display in ten years??

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post #21 of 72 Old 07-26-2016, 07:31 PM
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You just described a CM, not an ODM.
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post #22 of 72 Old 07-26-2016, 07:39 PM
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Guys there are 0 US parts on Vizio displays ,is just designed in the US and it will probably continue to be designed in the US.

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post #23 of 72 Old 07-26-2016, 09:19 PM
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I have few ideas what to think of this purchase. LeEco is somewhat unknown.

When Yamaha (makes fine pro audio gear, I've used a lot of their gear) bought Steinberg (makes fine pro audio editing and music creation software and hardware, I own Cubase, Wavelab and a pro I/O BOB) I wasn't concerned since both are dedicated to making great audio products.

With this purchase I'm a bit concerned, mostly because LeEco seems to be pursuing mass market products rather than pushing into high quality products.

The big questions I have are:
What will happen to the P series? Will it continue to pursue a higher end market?
What will happen to the R series? Will it become a viable high end product?
What will happen to customer service?

It'll likely take 2 or 3 years to see what direction changes might take place.

I hope the best.

Cheers,
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post #24 of 72 Old 07-26-2016, 10:14 PM
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You just described a CM, not an ODM.
Ah no, sorry, this is my line of work but won't derail too far from talk of displays. A contract mfg builds 100 percent to a customer bom. They cannot even deviate from one supplier on a zero ohm penny part.

ODMs/JDMs built to the critical parts only and are allowed to source their own parts for off the shelf parts but the part value must be equal. They may have some engineering input depending on company and relationship.

A CM model is strictly build to BOM and AML with no deviations.

Two completely different models.

Rick

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LeEco San Jose California Headquarters



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I wonder if vizio was afraid of losing business ,both headquarters are in California.


I'll pick another vizio P series if they finally add HDR10.

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Right. And 2B? That's all? Really?


Yeah, that's what I thought too. I would have that that the Vizio brand was worth more..


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First. As far as Vizio being bought out I could really care less because I was never a big fan of their tv's anyway. What does bother me some what is seeing yet another American company being bought out by the Chinese. But this buyout will either help the Vizio brand or it wont. Again no matter to me because I never intended to buy any of their products anyway. My first 32inch flat screen was a Vizio and it burned out within 3 months and I have never bought anything Vizio since. But best of luck to them and to the Chinese! lol
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LeEco went over the highlights of the valuation in the presentation. Based on their view, Vizio would have been worth much less than even $2bil as the TV/soundbar maker they are currently. LeEco sees a $900bil market for a combined display/content provider which is what they plan to create.


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Yeah, that's what I thought too. I would have that that the Vizio brand was worth more..


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