The most powerful company in CE

A while back I wrote a piece about Walt Mossberg calling him the most powerful man in Consumer Electronics. Well today it is time to talk about the most powerful company in CE... no I am not talking about Sony (which would have been the easy winner years ago), I am talking about Best Buy.

With the infusion of Korean & Chinese CE manufacturers the CE market has gone from a brand game to a distribution game. While names like Sony still command a price premium, that premium is slowly eroding... becoming less important... what every company needs to survive these days is distribution. The key to distribution in CE is Best Buy. Best Buy is the countries largest CE retailer and their lead is growing... they are doing so well they are pulling away from Wal-Mart... a great feat.

Every company from Gateway which is getting back to focusing on computers to AT&T, which is trying to transform itself to a VOIP company is now selling through Best Buy.

The guys at Best Buy know they are kings today, but they aren't resting on their butts sipping champaign... they know that Wal-Mart is a big threat... but they also know that Cable companies represent a threat. With the purchase of Geek Squad last year Best Buy signaled their intention to really fully own any given customer... Geek Squad will come and consult you on what you should buy and install if for you... Don't hold your breath for Wal-Mart to make the same move. This move was in defense of the Cable companies and RBOCs which will want to do the same thing.

Convergence is creating odd competition, and sometimes the key to success is simply recognizing that your competitors today won't be competitors tomorrow.... I think Best Buy understands this, and therefore I think they have a good chance of retaining their power in the CE industry.