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Sony Dumps PCs, Splits TV Op, Cuts 5,000 Jobs

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Bert22306
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CEO
Not like this hasn't happened before
Bert22306   2/6/2014 8:32:57 PM
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US CE companies like GE, Magnavox, Admiral, RCA, Westinghouse, Stromberg Carlson, Fisher, and a whole host of others, have had to get out of the CE business and either reinvent themselves or disappear entirely. Sony is dealing with that same problem.

My thinking was that Sony could get involved in this IoT field and in smart cars. Both require new sensor types, so their interest in sensors could make a good fit. I agree that they don't need to keep making boxes. For example, Qualcomm, some years ago, stopped making boxes and started building only chipsets. So even this type of reinvention of a name brand is not novel.

Yes, it's a huge change for Sony, but hardly unprecedented. Why should Sony be immune to this, might be a better question. The CE business is extremely competitive. Sony's products were always priced higher than the competition, so it's not surprising that competing against the newest low bidders, China/Taiwan and Korea, was going to be difficult.

resistion
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CEO
Wow TVs too
resistion   2/7/2014 4:24:51 AM
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I also bought Sony TV before too. Seems may be more than just PC demand problem now.

Sensing sounds promising. But do they have the right resources for it.

junko.yoshida
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Blogger
Re: Not like this hasn't happened before
junko.yoshida   2/7/2014 5:11:45 AM
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@Bert, you made an excellent point here. Many of these erstwhile CE brands in the U.S. you mentioned here either disappeared or re-invented themselves. So, why wouldn't Sony be able to pull that off?

junko.yoshida
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Re: Wow TVs too
junko.yoshida   2/7/2014 5:18:14 AM
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@resistion, that's a good question. Does Sony have the right sensing technology? I don't know. Well, they can always buy what hey need, too. But you are asking a better question. Do they have "the right resources" ( to acquire what they need, identify apps, find partners and customers, and pull the team together)? It remains to be seen.

alex_m1
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CEO
virtual reality
alex_m1   2/7/2014 6:37:56 AM
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It's too early to exit CE. Virtual reality could be a very big industry.There a lot of excitment from gamers and others.

 

And Sony is building a VR headset.Reviews say it's far better than occulus rift, the other commercial competitior, and it comapres to Valve which is has the best research prototype(and doesn't intent to market it). And sony could use it position in gaming to grab a big share.

But since the PS4 is relatively underpowered for virtual reality(it's only powerfull as a mid range pc) , that means sony will have to face some difficult strategic choices.Will it sacrifice PS4 for the next market ? . It would be interesting to see how this plays.


BTW 150,000 is the number of employees accross sony electronics,entertainments and finance. How many are there in electronics ?

prabhakar_deosthali
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CEO
Re:
prabhakar_deosthali   2/7/2014 8:15:34 AM
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Seems like Sony is following the way IBM exited from all kind of PC and server hardware business.

But Sony has to decide fast which way it wants to reinvent itself . Sony has been known as a consumer electronics company - TV, cameras, Laptops and the smartphones.

Not sure how it will cope with the new wave products like wearable devices and IoT stuff.
 

zewde yeraswork
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Re:
zewde yeraswork   2/7/2014 10:00:43 AM
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Yes, whatever direction Sony chooses to take they have to start setting off on that path soon. Obviously, they aren't going to be a box maker for much longer, and they are ready to get out of the PC business. Sensing could be an interesting lading place for them. Still,t he fact that their workforce is too big currently is a concern. That's going to drain a lot of resources until they make the cuts they have to make.

krisi
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CEO
Re: Not like this hasn't happened before
krisi   2/7/2014 10:31:49 AM
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Junko, Bert, I agree it can happen...but you have to be willing to embrace a dramatic change, come up with a vision and accept the losses (both financial and in workforce) to do that....I don't see the vision component in Sony and layoff are traditionally difficult in Japan...I would not bet my money on Sony...Kris

cookiejar
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CEO
Another Kodak?
cookiejar   2/7/2014 12:34:59 PM
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Just like Kodak, Nortel and Blackberry, Sony posses a lot of IP, but is dying in market sales.

When you are a market leader in technology, you get used to the large margins that allows you to cover your development costs plus a healthy profit.

Once your technical lead diminishes significantly, it becomes almost impossible to meet customer expectations for performance at the lower market prices.  How can Sony adjust to the new world after enjoying market leadership for half a century?

Sony's major killer apps came from its founder, greatly diminishing after his passing.  Sony also has its entertainment business.  Apple's killer apps came from the late Steve Jobs.  Apple also has iTunes.  Quite the parallel.


There's a lot of technology and business presented to China on a platter by IBM among others.  Is this becoming the standard path of Western and now Eastern technology companies?

DMcCunney
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CEO
PCs, TVs, and eBooks...
DMcCunney   2/7/2014 2:37:32 PM
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And as a minor side-light of the restructuring, another affected Sony division is the eBook reader operation.  Sony had already announced their latest Reader model would not be offered in the US.  Now they've handed over theit Bookstore operation to Kobo:  http://www.digitalbookworld.com/2014/sony-and-kobo-join-forces-for-ebooks-in-u-s-and-canada

It remains to be seen whether Sony will stay in the Reader business, but my guess is no.

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