ASIC Should Investigate Vizio And DVT Immediately

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COMMENT: Late last week lawyers for Vizio attempted to intimidate 4Square Media by threatening to seek an injunction to stop us writing about the problems Vizio face. We chose to publish what we knew.

Only months after Vizio launched it’s Plasma TV’s onto the market consumers are facing the possibility that the brand could disappear from the market leaving consumers without the security of the “bragged” about 5 year warranty and resellers with the pain of having to pick up the responsibility for the product. The only saviour will be an investor or the Vizio Corporation.

Stefan Wisniewski and his wife Theresa Mary Wisniewski who run both Digital Video Technologies and Vizio Pty Ltd should be investigated immediately by ASIC and so should Vizio Pty Ltd and Digital Video Technologies as both Companies are intimately linked. They have common executives, operate from the same premises and DVT has helped fund Vizio Pty Ltd operations in Australia.

When 4 Square Media first heard of Vizio’s cash flow problems we went direct to Zizio in an attempt to obtain monies owed by their advertising agency directly. We found out that Vizio were working with a financial advisor who himself was facing problems in the NSW District Court. After emailing Vizio directly and after a 2 hour face to face meeting we received an email from a solicitor representing Vizio that said, we require you to confirm by return that you are withdrawing your threat to publish a story about our client as, in the event that you do not withdraw that threat, our client will have to consider its options as follows. (a): Referring your threat to the police – effectively, we view your threat against our client as a criminal offence; or (b) Our client may need to obtain an injunction against you to prevent you from publishing the threatened article and/or make a claim for damages against you for defamation in the event that such article is in fact published.

We have published the story titled Visio In Trouble.

The facts are that Stefan Wisniewski and his wife Theresa Mary Wisniewski entered the plasma market with the Vizio brand hidden behind a marketing Company Robot Blonde and one has to ask the question as to whether this was deliberate. Normally a vendor is more transparent and up front than what these two executives were. However this does not mean that they have done anything wrong legally.

 

In the case of Vizio it was Robot Blonde who dealt with the media, fronted resellers and generally was the contact when it came to dealing with Vizio.

Organisations were told by Vizio representatives that the marketing was backed by a multi million dollar budget endorsed by Vizio in the USA. In January 2006 SmartHouse News was also told by Vizio representatives in an email “Vizio is now offering 5 year warranty and Free in Home Installation. We have also broken the wholesale Price Barrier for HD 50” Plasma. We are the only company offering dual HDMI.

They went on to say in the email “We will be shipping the NEW 37″ and 32″ HD LCD’S AT unheard of wholesale pricing. We are looking at moving 15,000 units by JUNE 1, when we will launch TV advertising Vizio will be launching an Australian specced HD STB as well as a 240GB PVR very soon”.

This was all lies. Vizio Australia did not have 37″ or 32″ HD LCD’S for the simple reason that Vizio were not able to produce PAL versions as the Company is experiencing massive growth in the US market and don’t have the manufacturing capacity to produce Plasma screens till much later this year. Nor did Stefan Wisniewski and his wife Theresa Mary Wisniewski have the money to ship 15,000 units by June 2006 which at $1,800 a unit purchase price would have cost them $27 million dollars. The fact is that in 4 months of trading they only sold around 160 units and by this stage their financiers were refusing them extended credit.

Stefan Wisniewski claims that he did not know these statements were being made to the market he also claims that he was unaware of the amount of media being booked or the cost.

This is pure lies as Wisniewski admitted to me that he knew about the sales brochure being distributed to resellers. He may not have known about the emails being syndicated to the market but his general manager did as we confirmed with him and published in a story in March 2006 comments made by Visio executives and representatives of Vizio.

 

 

We wrote at the time in a story on SHN that Adrian Chespy General Manager at Vizio told SHN that “over the past months we have worked closely with the specialist channel to find out exactly what they want from Vizio. We have listened to many criticisms on why the specialist channel is struggling up against the mass retailers”.
 “What we are attempting to do is deliver for this channel a range of TV screens that deliver high margin and great performance for their customers and we hope our new pricing strategy along with our specialist focused advertising demonstrates to them and the consumer that there is an alternative to mass retail where they can be comfortable in the knowledge that they are getting not only the best deal but the correct information and solution for their requirements”.

He added “Vizio is committed to the specialist channel and our current marketing campaign is just the start. We are an organisation who are delivering new vigour and growth opportunities it is now up to the channel to capitalise on the marketing that we have put into place to gain sales”.
He also said that during the next few months Vizio will move to TV with a major campaign. He confirmed that Vizio is now offering 5 year warranty and Free in Home Installation and that shortly they will be shipping new 37″ and 32″ HD LCD’s at highly competitive prices.

He also confirmed claims that Vizio is looking at moving 15,000 units by June 1, when Vizio will launch TV advertising. He also confirmed that Vizio will be launching an Australian specced HD STB as well as a 240GB PVR that is set to sourced from a third party vendor but branded Vizio.


Stefan Wisniewski has admitted to SHN that he saw this story and if he did alarm bells should have gone off that the story was not accurate. Not once did he contact SHN to correct the story. Nor did his wife who attended a SmartHouse Magazine Vizio shoot. These are seriouse issues and above all statements that are clearly misleading.
 
I believe that immediately ASIC should step in to ensure that Vizio Pty Ltd is not trading while insolvent. They should also investigate the relationship between DTV and Vizio as resellers are still carrying Vizio stock and need assurances that 5 year warranties can be met.

Media Companies and suppliers also need to know that Visio Pty Ltd is in a position prior to any sale that they are able to pay their media obligations to Robot Blonde.

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