“Mobile + TV” drives ecological expansion, can TCL open the door to AIoT

In recent years, the situation of color TV companies has become increasingly difficult. Color TV companies that have suffered from operating pressure in the predicament have begun to transform to artificial intelligence, looking for new development opportunities.

Under the AI ​​wave, color TV companies under pressure have entered the market one after another, driving the growth of TV product sales through technological transformation. Some of the radical color TV companies have deepened their deployment to the AIoT ecosystem, and TCL Electronics is one of them.

Picture from Canva

The pace of transformation is accelerating, and new business reaches new heights

Since the acquisition of TCL Communications, the transformation of TCL Electronics to the AIoT field has gradually stepped onto the right track, and the progress of the transformation has been accelerating. Judging from the Q3 financial report, this trend is very obvious.

The financial report for the third quarter showed that TCL Electronics’ smartphone and Internet businesses increased by 215.5% and 62.1%, respectively, and the growth momentum was very rapid; the TV business continued its steady growth in the first half of the year, with a year-on-year increase of 49.7%. Sales reached 7.24 million units; Q3 revenue reached 31.83 billion Hong Kong dollars, a year-on-year increase of 76.6%. In the consumer electronics market full of uncertainty, it is very rare for TCL Electronics to achieve rapid revenue growth.

Such rapid growth is mainly related to the progress made by TCL Electronics in overseas markets. For example, in overseas markets such as Europe and the United States, TCL Electronics’ TV product sales have increased by 81.3%, which has provided a great boost to the growth of its TV business; in the mobile phone business, TCL Electronics relies on its channel advantages. In the United States, Australia, Europe and other markets, sales have also doubled.

These dazzling performances in overseas markets benefit from TCL Electronics’ exploration in AIoT transformation. Since the acquisition of TCL Communications, TCL Electronics has accelerated the pace of AIoT strategic transformation, and opened up the overall ecology of smart homes through the combination of mobile, home intelligence and other application scenarios. In this year’s interim report, the transformation effect of TCL Electronics has initially appeared, which can be seen from the high growth of its Internet business that has achieved a year-on-year increase of 126.9%.

In addition, after the integration of mobile phone business, TCL Electronics’ layout in the AIoT market has also gone further. Judging from the third-quarter financial report, the fast-growing mobile phone and TV business has become the core force of TCL Electronics to open the AIoT market.

“Mobile + TV” drives ecological expansion

With the wave of color TV companies switching to AIoT, TCL Electronics has also begun to enter the market through a combination of “mobile phone + TV”. This layout model has brought many benefits for TCL Electronics in the AIoT market.

On the one hand, in the current AIoT market, smartphones are still an important entry point for the AIoT ecology, which is of great significance to the layout of enterprises in the AIoT ecology. And TCL Electronics, which is working hard in the mobile phone market, will also have stronger competitiveness in the AIoT market.

On the other hand, TCL Electronics also has the brand and channel advantages accumulated in the domestic and overseas markets for many years in the TV field, which can also provide a great boost to the growth of its mobile phone business. It can be seen that the layout of TCL Electronics in the AIoT field is to use the advantages of the TV business to drive the growth of the mobile phone business, and then combine mobile phones and TV products to open the AIoT market.

At present, TCL Electronics has achieved certain results in the AIoT market. For example, in overseas markets, TCL Electronics has leveraged its accumulated channel advantages to cooperate extensively with Internet giants such as Goolge, Roku, and Netflix to provide users with better Internet services, which has provided a lot of help for its expansion in the international market.

In addition, TCL Electronics’ “TV + mobile phone” layout model has naturally driven the sales growth of its wireless Bluetooth headsets, routers, and tablet products, which is more conducive to its expansion of the AIoT ecological layout.

In terms of the market, this layout model of TCL Electronics can also help it increase its barriers to competition in the AIoT field. Compared with color TV companies such as Skyworth and Changhong, TCL Electronics, which has the advantages of mobile phone products, obviously has stronger competitiveness. However, in the highly competitive AIoT market, TCL Electronics faces not only color TV companies such as Skyworth and Changhong, but also giants at home and abroad from various fields such as the Internet, communications, and AI.

Under such circumstances, there are many uncertainties whether TCL Electronics’ “mobile phone + TV” layout model can enable it to cope with the competition from all-category AIoT ecosystem vendors such as Xiaomi and Huawei.

The domestic and overseas markets are under pressure

As we all know, the AIoT market has huge potential, but ecological construction is difficult. Due to the huge scale of the AIoT market and covering multiple fields such as the Internet, smart manufacturing, and AI, industry competition is fierce.

In such a market, TCL Electronics, which is deployed in the “mobile phone + TV” model, is bound to face considerable competitive pressure. First of all, in overseas markets, TCL Electronics has to face not only powerful rivals such as Microsoft and Google, but also Apple, which has an absolute advantage in the field of mobile phones. Compared with these giants, TCL Electronics is difficult to compete directly with these companies by virtue of its own strength.

Secondly, in the domestic market, Xiaomi and Huawei have fully deployed in the AIoT field. Among them, Xiaomi, which entered the market early, has formed a very strong competitiveness in the AIoT market. If TCL Electronics wants to grab food from the market, it must bear greater pressure. In addition, with Internet giants such as Ali and Baidu also entering the AIoT industry with smart home products, TCL Electronics will inevitably face greater challenges.

Under the pressure of domestic and overseas markets, TCL Electronics has suffered a lot of impact. In 2019, in order to optimize its business structure and enhance its competitiveness in the AIoT market, TCL Electronics reorganized the company’s major assets, which caused shocks in the senior management. Seven vice presidents and CFOs left one after another, which once put TCL Electronics into a crisis. .

It wasn’t until this year that TCL Electronics’ transformation was on the right track, and the negative impact of executive resignation gradually faded. However, for TCL Electronics, the pressure from the market is still not to be underestimated. How to expand its own advantages as soon as possible and occupy a place in the giant AIoT battlefield is still a question it needs to think about.

How does TCL Electronics counterattack?

In the case of sluggish demand in the home appliance industry, AI has become a life-saving straw for color TV companies. Whether the transformed TCL Electronics can successfully counterattack by relying on the AIoT layout needs to be analyzed from its own business and market situation.

In terms of business, the advantages of TCL Electronics are still in the brand and channel advantages accumulated in the TV business, and the rapid growth of mobile phones and new Internet businesses will take time to further expand its advantages. Therefore, TCL Electronics’ layout advantages in AIoT will need a longer time to accumulate to be reflected.

In terms of the market, the “mobile phone + TV” combination punched by TCL Electronics has achieved certain results in overseas markets. However, as the domestic market structure tends to stabilize, it is difficult for TCL Electronics to open the domestic market with the “mobile phone + TV” model.

Therefore, for TCL Electronics, overseas markets are more suitable for the development of its “mobile phone + TV” model. In overseas markets, after years of accumulation, TCL Electronics has established advantages in channels and brands, which is more conducive to its AIoT ecological development. In addition, TCL Electronics has also released AIoT ecological products such as mobile phones, speakers, and Bluetooth headsets in overseas markets, which can also give it more initiative in the market.

In the domestic market, TCL Electronics needs to leverage its advantages in the color TV market to penetrate the AIoT field. Therefore, for TCL Electronics, it may be more suitable for its development to penetrate overseas markets with the “mobile phone + TV” model, take advantage of TV business advantages, and occupy the domestic market.

However, whether this layout model can make TCL Electronics stand out in the AIoT market at home and abroad is still unknown. As the AIoT war becomes more intense, TCL Electronics will also face greater pressure. However, despite the many pressures, TCL Electronics still needs to continue to explore in the AIOT market, after all, this is related to the future of TCL Electronics as a whole.

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Author: Yoyokuo