Editorials

Diversified Tech Firms with Lighting Divisions Looking for Profitability Away from General Lighting

Some of the major LED Lighting makers are switching their focus as the LED lighting technology matures. Increasing competition, lower prices, and decreased profitability are to blame. For example, Cree is switching its focus away from general lighting to markets with better prospects including power electronics and RF.

Osram is now focusing more on Automotive LED lighting, and 3D identification technology for smartphones, and advancing the Internet of Things. The best example of shifting business priorities has to be Osram. Osram has decided to sell its luminaires business as part of this refocusing. In recent months the company officially started a joint venture with Continental, Osram Continental to provide Automotive lighting. The company also acquired startup Vixar, which specializes in the technology for 3D identification.

Additionally, Osram took over BAG Electronics, which uses LED lighting to offer IoT applications. In another investment in what Osram believes to be a growing field, the company purchased horticultural LED lighting firm, Fluence Bioengineering.

Similarly, Philips Lighting renamed itself Signify. While not specifically mentioned this may be a move to distance the company from the more profitable businesses.

Consumer electronics giant, GE is also in the process of selling its lighting business as profits shrink with increasing competition.

Current powered by GE, an off-shoot of GE’s lighting business, now supplies lighting and lighting infrastructure solutions, which can include providing IoT connectivity. Also, in another example of switching focus away from general lighting, Current by GE recently announced a collaboration with Jones Food Company on one of the biggest indoor farms in Europe.

Overall, such diversified tech companies with lighting businesses apparently see a profitable future in IoT. Some such as GE and Osram are also now working on horticultural LED lighting. Additionally, these companies are looking to increase their revenues in new technologies including autonomous and electric vehicles as well as smartphone 3D identification measures.

In the short term, these companies expect to reduce profits in general lighting but gradually grow profits in other technology sectors. This trend will likely continue, with or without added U.S. trade restrictions and tariffs.

Luxeon Color

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