Epson 2005 Annual Report Download - page 8

09Seiko Epson Annual Report 2005
Making Epson Synonymous With Photos
In inkjet printers, driven by Epson’s Photo Strategy (“Epson=Photo”), we are committed to making
home photo printing a reality, enabling anyone to easily print pictures taken on digital cameras and
mobile phones at home. One of the products making this possible is PictureMate, a compact
printer with a convenient handle for easy carrying that can print without using a PC. This printer has
sold especially well in the United States and Europe. In Japan and elsewhere, sales of multifunction
printers have also been brisk as we upgraded the lineup to keep pace with this market as it expands.
In the fiscal year ending March 31, 2006, we plan to grow unit sales for high-end printer models
that target professionals and serious amateurs, alongside consumer-oriented models. In this way,
we are determined to make the Epson name synonymous with photos worldwide through a product
lineup that a wider range of users can enjoy.
To reduce fixed expenses we have successfully cut component and raw materials costs, particu-
larly for core multifunction printer models. Similar initiatives remain on our agenda for the fiscal year
ending March 31, 2006.
Expanding the Scope of the Electronic Devices Business
A major issue in electronic devices is our heavy reliance on devices for the mobile phone sector, which
account for the lion’s share of sales in this business segment. That’s why it is urgent that we broaden
the scope of this business and develop a structure better able to weather market fluctuations. To do
so, we are optimizing Epson’s strategies for each business in the electronic devices domain.
In LCDs, while the number of end-market applications has expanded to include PC monitors,
LCD TVs, mobile phones, digital cameras and onboard display devices, LCD panel prices continue
to fall as competition heats up between domestic and overseas display makers. It was this market
environment that prompted Epson and the Sanyo Electric Group to integrate their respective LCD
operations in a joint venture, Sanyo Epson Imaging Devices Corporation, which began operating on
October 1, 2004. Both companies have combined their respective technological strengths in
compactness, higher resolution, higher definition and volume production. The result is a structure
enabling the supply of highly functional LCDs that offer comparably high cost performance. Further,
in March 2005, Epson decided to withdraw from the production and sale of large LCDs, where
prices have plummeted. With this move, Epson can now focus exclusively on small and medium-
sized displays in response to rising demand from the growing mobile phone display market. Over
the medium term, though, we are working to supply sectors other than mobile phones, among
them handheld IT devices and onboard automotive device displays. Ultimately, we aim to build a
business base more resilient to fluctuating market conditions by concentrating on highly profitable
products and spreading risk.
We have decided to integrate Epson’s quartz device operations with those of Toyo Communica-
tion Equipment Co., Ltd. (Toyocom) on October 1, 2005. Quartz devices play a key role in digital IT
equipment, and can be found in wireless communication devices, PC clock functions and other
products. This integration will allow each company to strengthen its hand in areas where both
shine: technology for volume production and microfabrication, and high-precision processing tech-
nology. The goal is to lead the industry in quartz devices.