Logitech getting out of the remote control business
Blaming poor sales despite the launch of more upmarket devices, Logitech is to pull out of the remote control business.
The process to divest the company of its Harmony remotes is already underway, company president and CEO Bracken P Darrell saying that such products 'no longer fit with our current strategic direction.'
Also on the way out are 'other non-strategic products, such as speaker docks and console gaming peripherals', which will be removed from the company's line-up by the end of this year.
The move comes as Logitech announced sales for the last three months were down 14% on the same period in 2011, giving the company a net loss for the quarter of $195m (£123m), against a net profit of £55m (£35m) in the previous October-December.
Despite having bolstered its Harmony range with more sophisticated and upmarket products, such as the Harmony Touch (left) it introduced just three months ago, Logitech has seen sales in the sector falling.
Year-on-year, Harmony remote sales in the last quarter of 2012 were down 24% by value, and 55% by quantity, reflecting that shift to higher-priced products.
However, the shift away from selling lower-priced remotes hasn't paid off: sales of the high-end models rose just 4%.
As a whole, sales in October-December – the peak gift-buying season – were down 14% worldwide year-on-year: down 8% in the Americas, 11% in Asia and 20% in Europe.
Darrell says that 'We are taking immediate actions to shape a faster and more profitable Logitech [by] developing more mobility-related products, leveraging the powerful growth of tablets and smartphones.
He added 'I was pleased with the continued strong demand for our Ultrathin Keyboard Cover in Q3.
"We plan to expand our presence in the growing tablet accessories category with the launch of a number of exciting new products later this quarter.'
Comments
I think Logitech is endavouring to offload the Harmony division to a third party, PoisonJam, and as mentioned below it says it's committed to supporting the products out there.
I just don't get why they'd shut it right down. They have this niche market cornerd as no competing product comes close when it comes to updating the remotes. Surely they could make it profitable somehow? Only continue with one model? Keep selling one model and only refersh it once every few years to keep down R&D costs? Raise the prices (I'd still buy one at twice the price if my Harmony One broke)?
My Harmony One was water damged damaged last year and I went straight out and bought another to replace it. Does this mean support will be dropped too (i.e. adding new devices).
Shame, I use also Logitech harmony for all my audio and vision is such a great universal remote and clever to use,
Such a pity. This is confirmation that Logitech are strategically moving away from their uniquely affordable high-end media products into mass-consumption.
Discontinuation of the Logitech Squeezebox was the saddest news last year. This is an early candidate for this years.
It is truly tragic that the management failed to see the potential of these products (both from humble backgrounds) and instead are putting their efforts into the over saturated market for cheap, mobile multimedia. I have no doubt that a surge in profits will vindicate the strategic move in the short term, but it's such a pity they've discarded what could have been the future of living room entertainment.
Here’s hoping someone else will pick up where slimdevices etc left off.
Shame they shuttered Squeezebox rather than divest. I reckon there was more value in the streamer division than in remote controls. I'd expect Logitech to disappear with the bungling management.
Very sad indeed. I did suspect this would be the case, as the number of models had shrunk.
I'm quite miffed, and I don't even have one.
Lol Paul I recon that the normal everyday public don't actually KNOW how good the likes of a Harmony One is ?
I'd never know about them if I never frequented the What HiFi site tbh as there isn't much in the way of advertisment.
What will this mean for us being able to update existing remotes when we buy new peripherals?
See the link below from Paul.
Just recieved this on twitter from Logitech...
http://forums.logitech.com/t5/Harmony-Remotes/Logitech-s-Commitment-to-Harmony-Customers/td-p/967579
Blimey, what the heck is happening at Logitech?
I have 2 squeezeboxes (duet), and 2 harmony remotes (one and something else), and each product is absolutely superb. A streamer that gives me superb quality, a remote that works better than anything else I've used. Someone in the company is doing something wrong. ;(
Bit strong paul!
My concern lies only with, our ability to update our remotes in the future.
As concerns previously raised.
I wonder what their new direction will be.
Should I still buy a Harmony Touch, even though support will probably be out of the question within a few months?
Clare - what will this mean for us being able to update existing remotes when we buy new peripherals?
WHF will need to ask Logitech their plans for longer-term support of the products, including software releases.
I'm sure some enterprising type could potentially release their own updates....
Sad news - I still use my Harmony One remote almost every day, and it's worked superbly from the day I bought it.
Clare - what will this mean for us being able to update existing remotes when we buy new peripherals?
Sadly inevitable given the growth of smartphone/tablet-based control apps. To steal a New York Times headline " the smartphone is now the remote control for our lives"
Damn you general public being satisfied with multiple remote controls... Damn you and your messy lives!