Anyone who has been hoping for a brilliant future with Brillian (NASDAQ:BRLC) has received a rude awakening over the course of just one week. Today, things got worse for Brillian when Sears, Roebuck (NYSE:S) dumped it as the provider of its own branded high-end TV, Veos, after a short one-month agreement.
Last Monday, Fool contributor Dave Marino-Nachison covered word that Brillian had blown it -- because of a shortage of components from JDS Uniphase (NASDAQ:JDSU), it had to delay shipments of its high-end product.
Today, there was no explanation as to why the Sears agreement fell through. However, investors might have suspected the handwriting was on the wall, given the production delay. As Marino-Nachison pointed out, with fall potentially a key time for a TV upgrade, Sears might miss out on customers looking for ways to view the football season in high style (and high style it would be, considering the proposed $7,999 price tag for the 65-inch Veos). Despite it all, though, Brillian said today it is still on track with its previously amended manufacturing plans.
Taking it to another level, though, things might be getting a little tougher for many of the companies involved in electronics manufacturing and marketing. Sony (NYSE:SNE) warned last week that there might be some weakness in home electronics for this year's holiday season. Its warning included the fact that flat-panel TV prices are falling as rivals get competitive.
That brings me to my previous suspicion, that the price tag for the Veos would be a stumbling block for Sears' usual customer demographic -- and maybe for shoppers overall -- if prices for other high-end TVs are more palatable. None of this bodes particularly well for Brillian, given the fact that Sears was its first and only retail partner thus far.
Shares of Brillian recently plunged 36% to their lowest point since the company was spun off in 2003. It's hard to fault investors for the negativity -- given the loss of its sole retail partner, the picture is currently looking blurry for Brillian.
Were you mulling the purchase of a $7,999 TV? Or something much more affordable? Get tips and talk about products on the Help With This Home Theater discussion board.
Alyce Lomax does not own shares of any of the companies mentioned.
