News reports today suggest that Pioneer is about to bite the bullet and exit manufacturing of plasma displays. It is in negotiations to have the panels made by Panasonic, but Pioneer would continue with its own R&D and assembly. Pioneer has fallen well short of its sales target and its investment in Kuro technology has failed to stem the decline. A company spokesman claimed that the only way to stay in the plasma business was to make a product that is "so much better than anyone else's", which is what Kuro was intended to be. It seems even that has not been enough. Pioneer's news is not unexpected: the company had already announced its entry into LCDs for sub-42" TVs, and is part-owned by Sharp. But as one of plasma long-term stalwart supporters Pioneer's decision to cease manufacturing is a significant moment. Whether Panasonic can continue to meet Pioneer's exacting standards remains to be seen. It is no small irony that Pioneer's execs have persuaded at least this observer, with detailed side-by-side demonstrations, of the superiority of their displays in comparison to those of their competitors, yes, including Panasonic... There are two messages from Pioneer's decision to pull the plasma plug: 1. Any remaining Plasma supporters need to watch the bottom line very carefully, even if they do have the scale of Panasonic 2. Japanese firms are increasingly willing to address financial realities by making tough decisions to drop support for commercially failing technologies The latter point will resonate with Toshiba, of course, after the HD-DVD saga. Competing technologies need ardent advocates but when the CFO points the finger it's time to say sayonara... Client Reading: Flat Panel TV Global Market Forecast Panasonic's AV Strategy: Plasma Success Will Not Prevent Revenue Shortfall