Logitech could dump video-conference arm in revamp
By Martin de Sa'Pinto
ZURICH (Reuters) - Logitech's chief executive said his company will decide within 90 days whether to sell the video-conferencing arm it bought in 2009 for $405 million after this week writing down the unit's value by more than half.
The LifeSize video conferencing unit has failed to shake up a market dominated by Cisco and Polycom and where Chinese giants Huawei and ZTE are making inroads, while global revenues in the segment have slid as economic uncertainty persists.
Any of the above four companies could be potential buyers for a small niche player in the $3 billion a year market, analysts said.
"This is such a tough market, and that's the biggest driver of the impairment," Logitech's newly anointed CEO Bracken Darrell told Reuters in a telephone interview.
"It's not an easy decision. Is this an asset that makes more sense for us to own or for someone else to own?" Darrell said, adding that the unit was well positioned for success among small and medium sized businesses.
The company also wants to sell its remote controls and digital video security businesses, and to develop more products for smartphones, touch-screen tablets, and for computer gamers.
"It's important to note we're going to shrink the company first and make it more profitable, and then focus on areas where we think we can grow," said Darrell after the company reported lower year-on-year sales for the fifth consecutive quarter.
"PC gaming is an area we haven't grown in because we didn't launch any new products, but we're going to do that now. Mice, keyboards, headsets," said Darrell, a former executive at household appliance maker Whirlpool. Continued...