Directed Exits Mobile Video

By Amy Gilroy On Sep 15 2008 - 6:00am

Directed Electronics announced last month it is exiting the mobile video market due to slower sales and low margins.

Directed president Mike Simmons explained, "We are exiting the mobile video category due to long-term declining consumer purchase trends and our desire to focus our efforts on strategic product categories where we can add significant value for our dealers and customers."

The company also said its video business had "been by far our smallest product category with very low margins," according to Simmons.

Other suppliers said video has been hit by competition from Asian vendors and higher costs of LCD panels. Priority Audio national sales manager Bill Hienlein noted, "For a number of years, it was a profitable business, but there's been incredible pressure now to reduce pricing and recently the escalation of the cost of the panel has caused a lot of people to take a second look at it. For the amount of money it takes for the tooling for the housing and the lag — it takes three to six months [in production] if you're pushing hard — so by the time you bring a model to market that you were going to sell at $399, you have to sell it at $329 and you're not making any money on it."