Cree says innovation answer to rising competition
By Alastair Sharp
TORONTO (Reuters) - LED lighting manufacturer Cree Inc (CREE.O: Quote), which aims to make traditional lighting obsolete, promises further innovation and a better product as it tempts customers with a low-power light bulb priced around $10.
Durham, North Carolina-based Cree makes energy-efficient light-emitting diode chips and lighting products, and it provided more than half the LED street lights the city of Los Angeles recently installed in a massive overhaul.
Six weeks ago it jumped into the consumer space, boasting a 25,000 hour lifetime for a light bulb that it says will save users 84 percent on energy costs compared to typical incandescent bulbs.
"It is a good thing to do from an environmental standpoint but I want to get to the most basic value that drives behavior, I want it to pay for itself," Cree Chief Executive Charles Swoboda told Reuters on Wednesday.
The launch of a direct-to-consumer business has done nothing to slow the company's stock price rise, despite the obvious challenges of going up against established giants.
Cree competes with Samsung Electronics (005930.KS: Quote) and others in the LED component business, and against Siemens (SIEGn.DE: Quote) subsidiary Osram and Dutch electronics company Philips (PHG.AS: Quote) in lighting.
The company is spending roughly $5 million this quarter to promote the bulbs, and Swoboda said the only way for the small company to survive against electronics giants is to keep evolving faster.
"We have to keep innovating," he said. "We might have a great product but we have to invent a better one. We've got to give the customer better value." Continued...