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Sim2 Relies On Innovation To Stand Alone

5/17/2011 11:15:02 AM Eastern

Pordenone, Italy - Faced with a home theater video display market
that is moving more and more toward commoditization, Sim2 is separating itself by
maintaining both premium prices and an elite product profile within the
high-end home theater projector business.

 Sim2

While this step may seem counterintuitive to those living in the cut-throat
mainstream consumer electronics channel, Sim2 USA executive VP Alberto Fabiano
said it makes perfect sense when you see the growth of other premium goods from
manufacturers that don't dicker on price, such as Ferrari or Apple.

In fact, as other display manufacturers are scaling back, Sim2 USA,
which this year celebrates its 15th anniversary coinciding with the
150th anniversary of the Republic of Italy, continues to upgrade its
R&D, assembly and service facilities here and even recently added a white
room for the manufacture of its own DLP light engines using Texas Instruments'
Digital Micromirror Devices (DMDs).

Simply put, Fabiano said, Sim2 is an elite high-performance front
projector developer "dedicated to producing realism in the home that rises
above everything else to people who can pay for it."

That mission might have slipped away if Sim2 had continued to
follow a brief marketing divergence that saw it add an entry-level, Asian-sourced
model (the D60) following the lead of its volume-oriented competitors. But the
company quickly recalculated that strategy last year sensing the dangers of the
commodity trap that has hurt other display makers.

The Sim2 brand is now once again focused solely on the production
of high-value, Italian-assembled products worthy of a higher price tag that
sophisticates can justify.

This is a mission that Maurizio Cini, global company parent Sim2
Multimedia president, now says he sees the company maintaining another 15 years
in the future.

"We will invest in different technology, but in the future Sim2
will still be acting, and still leading the home theater market," Cini told
TWICE, adding it is unlikely that Sim2 will look to integrate smart
technologies into its displays, opting instead to focus on the company's
strengths in the display component end of the business.

To help read and react to this segment, Sim2 is listening more
carefully than ever to its 250 U.S. dealers, Fabiano said, calling them all "members
of the Sim2 family."

"The Custom Integration channel is made of dealers. They are
consultants and they really should be the brand. We are just suppliers, and we
supply products that these people can use to propose to their customers
excellent systems. They cannot do it themselves and we cannot do it without
them."

"This is what is going to keep this channel up. If we aren't
successful in doing that, this channel is going to disappear," Fabiano warned.

Cini said, "the value of a company like us to be able to provide
customized service and support. We cannot even consider becoming part of a larger
consumer distribution [operation] because we don't provide any special benefit
to this. I think our strategy was right in the past and even if the market
shrinks, because everyone is looking for numbers, there is still space for
service excellence in specific products and specific brands."

At the same time the global parent Sim2 Multimedia is poised to add
on to its current businesses including, commercial and home theater display
systems, and LED room and area lighting systems.

The company recently acquired full rights to the Brionvega brand
that is long known in Italy as a manufacturer of uniquely crafted radio, home
audio and portable TV products. It is now formulating plans to expand that
brand's reach into other markets in the near future. Details will be announced
later, company executives assured.

Cini suggested that Brionvega could be taken into global markets
that promise the Sim2 line the most growth and opportunity, including major
emerging targets China and Indian, in addition to core growth pockets of Europe
and the United States. The latter, he said, is Sim2's largest current global
market segment, representing better than 30 percent of the global mix.

Unfortunately, Sim2 is faced with a difficult financial situation
as the value of the U.S. Dollar continues to collapse against the Euro, and
price increases seem inevitable this summer.

"We are fortunate to have very good relationships with our
partners," Cini said. "We were obliged in the past to raise our prices because
of this unfair currency situation and if nothing changes I think we will be
obliged [to do it again]. Fortunately the value of our proposition is the
stability, the protection and the quality of the product which enables us to share
together with our partners, profit at times of a strong currency and at this time
of not very favorable currency, we are obliged to share some increase of
pricing cost.

"In the 12 or 13 years we were in the U.S. we have changed the
price many times and I didn't ever measure trouble," Cini noted. "[That is] because
people understood the reason, and they were smart enough to justify the
different value proposition we bring."

Asked how he would expect his competition to react to a price
hike, Cini said, "Based on cost we cannot compete even now with our current
competitors because nowadays most of them are sourcing from China or someplace
else in Asia. Fortunately our investments in R&D in the last year were so
huge in delivering truly innovative products that I don't know what is going on
with the others but I [feel confident] in following my own way."

In development is a High Dynamic Range (HDR) technology that Sim2
intends to use as a future local dimming technology that can be applied to
next-generation flat-panel display systems in both flat-panel and in LED-based
projection systems. The technology promises to deliver new levels of detail and
color in images with both very bright and dark segments. But Cini said the high
cost of adapting the technology will require a little more time before a
product comes to the home theater market.

As for new products, Sim2 said it would maintain a virtual
product per month introduction cycle throughout the year. So far, it has
unveiled the C3X Lumis 3D Solo ($50,000 suggested retail) and the Lumis 3D Solo
HC ($55,000), the Crystal 35 ($6,500) and the Crystal 45 ($8,500) models.

The Lumis 3D Solo  and
Lumis 3D Solo HC 3D projectors are three-chip 1080p DLP projectors that emit up
to 3,000 lumens of brightness at a 35,000:1 contrast ratio and come in a choice
of three lenses (T1, T2 and T3) offering flexibility in throw distances to
accommodate a range of installation scenarios.

Sim2 is the first consumer electronics company to make available
Triple Flash 3D Technology, which Fabiano calls "the best way to watch 3D."

The technology flashes images at a rate of three times per eye
instead of the standard two times per eye to eliminate any perceived flicker in
the image.

The Solo 3D models also employ PureMotion 3D technology that is
said to eliminate judder from fast-moving action. The Lumis Solo models ship
with four pairs of Xpand 3D active-shutter glasses.

They join in the line the Lumis 3D Duo, which was shown at the
2010 CEDIA Expo. That system essentially pairs and synchronizes two Lumis 1080p
projectors using Infitec passive glasses technology.

The recently introduced Crystal 35 and 45 projectors are
single-chip DLP models with 2,000 and 2,600 lumens of brightness and a 30,000:1
and 50,000:1 contrast ratios, respectively.