India, Jan. 22 -- Sony's decision to hand over a majority control of its TV and home-audio hardware business to China's TCL is being read as a standalone corporate move. But the acquisition sits inside a longer arc, which is the steady unbundling of "home entertainment" into two separate and different businesses. The first is the high-margin one, where brands compete on picture processing, audio tuning, premium perception, ecosystems, and content adjacencies. The other is the industrial layer where winners are decided by panel supply, factory scale, logistics, working capital discipline, and the ability to keep prices sharp and costs in control, while funding R&D.

Sony seems to have conceded that the second option is for players like TCL...