This is how it has ceased to be a technological giant

Toshiba for many years was a prestigious and common brand in homes. It was an example of the good work of Japanese companies. In the 1980s, in the 1990s, and even at the beginning of this century, it was one of those Japanese companies that was taking over the world. Instead, it is now a shadow of what it was, a company that has companies to leave organized markets and that has sold some of its most interesting and advanced units.

I’m going to tell something personal. Toshiba is a brand with which I had a certain emotional relationship. The laptop with which I wrote my first contribution to this publication was made with a laptop of this brand. The ultrasound machine with which I saw my son for the first time was a Toshiba brand. I recently bought a Toshiba brand TV set, but when I did some research I saw that Toshiba had little more than the brand, as it was made by Toshiba. a Turkish company. So I started to investigate what had happened to that brand that was so familiar to me.

Historia de Toshiba

Toshiba comes from the merger of two companies in 1939, after the union of the Tokio Denki and Shibaura Seisaku-sho companies. Initially it was named Tokyo Shibaura Denki and in 1978 it was formally renamed Toshiba.

Based on new businesses, the company ended up having a presence in multiple businesses, both consumer and business products. This meant that Toshiba was involved in businesses as diverse as music (with Toshiba EMI) and nuclear energy, passing through products such as elevators and escalators, household appliances, medical, railway and military equipment, batteries, etc. It came to have around 200,000 employees worldwide.

They were also able to develop Japan’s first products such as the first color television, the first microwave oven, the first word processor, the first laptop or the first DVD player.

They also developed their own technologies, such as the first mass-produced laptop (the T1100), they invented the first flash memory that was not erased when the power went out and they were one of the companies that developed HD-DVD, the competitor format to blu-ray that ended up losing the battle.

It could have been a story of the typical Japanese conglomerate that makes everything under one brand. For example, under the Mitsubishi brand we can find cars, planes, air conditioners, etc. This model is not uncommon in Asia, where we have examples such as Samsung in South Korea or Vingroup in Vietnam. But Toshiba’s fate was set to be different.

Accounting scandals and dismemberment of the company

In 2015, a accounting scandal. The worst in Japan since it was discovered that the company Olympus Corp it hid losses of 1,700 million dollars at the end of 20111. At the beginning of the year, several control instances detected problems in the company’s balance sheet1. Toshiba had been inflating its results since 2008.

According to an independent commission of inquiry chaired by a former Tokyo judge, the profits were overstated by more than $1.2 billion. On the one hand, the business culture in which it was not possible to replicate a superior was identified, and the then CEO Hisao Tanaka, and vice president Norio Sasaki, were also blamed. Other executives resigned due to the magnitude of the scandal, the largest in 140 years of history. This also had quite a few episodes something harmful, since in the business world it is always better that all the bad things come out and reduce at once.

Toshiba therefore had to get rid of several of its divisions.allowing the use of its brand by new buyers who saw a way to be able to sell under a brand that for a long time manufactured prestigious products.

Toshiba Visual Solutions ended up in the hands of China’s HiSense, with the ability to use the brand for 40 years. Toshiba Lifestile (home appliance manufacturer) also in the hands of the Chinese Midea (of which we have already spoken). The NAND memory division is a joint venture with Bain Capital and has changed its name to Kioxia. The laptops are from Dynabook Inc (the brand used by Toshiba for your laptops) and ended up in the hands of Sharp. The air conditioners are Toshiba Carrier (and Toshiba has a testimonial participation in them), Toshiba Medical Systems was acquired by Canon, Westinghouse Electric Company that was dedicated to nuclear energy in the US ended up filing for bankruptcy and in the hands of a private equity fund.

Toshiba’s future

What is the future of Toshiba? At the moment, it has had to sell a good part of its businesses and many of its remaining businesses (batteries, printers, railway equipment, consultancy, etc.) are not products that the market can consider technological, although Toshiba claims to have made advances in quantum computing, automotive components and other technologies that will soon be commercialized. Also from the crisis we find non-Japanese in their board of directors.

The Council proposed a loaf to divide the company in three companies, which was rejected by the shareholders. In 2022 he presented another option for split the company in two since the first plan had been liked by the shareholders.

The possibility of it not being listed on the stock market is also being considered, and it will be left in the hands of private capital. In any case, the Toshiba products that we acquired as buyers have ceased to be products of the Japanese company and are companies that use their old brand.

Will Toshiba survive? Time will tell. Your brand is likely to be on retail shelves for a few years as long as it continues to hold sway among consumers who have seen better days. Its logo hasn’t shined in Times Square for a long time and it’s unlikely it will again.