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Harman Brings Samsung Leadership in Connected Car Market
Samsung has made an offer worth around $8 billion to acquire US audio/automotive specialist group Harman International. The deal will jump-start Samsung in the global automotive infotainment market, which Futuresource values at around $30 billion (including telematics and navigation), as well bringing Harman's stable of consumer and professional audio brands to Samsung's portfolio.
In the world of consumer electronics, Harman has been quite an unusual success story – a traditional high-end home and car audio specialist which has flourished through revolutions in wireless, mobile and streaming music, while riding a wave of change in the automotive sector as in-car entertainment has been increasingly integrated with information, navigation and telematics. Harman has grown both organically and through acquisitions, now owning more than 15 brands including JBL, AKG, Infinity, B&O (automotive only) and B&W. Harman/Kardon is also still also a tier-one global audio name in its own right. In professional AV, Harman has also acquired specialist professional firms like Studer and Revel to strengthen its portfolio and integrates AV and lighting solutions for events, venues and other sectors.
Automotive is seen a major strategic technology opportunity, attracting interest from major players like Google and Apple. In 2015, 92 million vehicles we made worldwide, of which 73 million were cars, and the average electronics value per automobile continues to rise year-on-year. However, the key to success in this market lies in relationships between technology providers and vehicle manufacturers: Harman has presence in 36 vehicle marques and is #1 in branded car audio.
To sum up, the Harman deal will provide Samsung with a leading position in the connected car, bolster its position in home audio and open up an entry into the pro AV market. It is expected that the company will operate as an independent subsidiary of Samsung.
In December our 'Connected Car Opportunities' will seek to address the wider opportunities associated with this sector.
Here at Futuresource Consulting we deliver specialist research and consulting services, providing market forecasts and intelligence reports. Since the 1980s we have supported a range of industry sectors, which has grown to include: CE, Broadcast, Entertainment Content, EdTech and many more.