News is spreading wide and fast that Sony is selling its mobile division, including iconic smartphones like the Xperia Z3 and tablet series. The “news” is the result of comments of Sony Corp. CEO Kaz Hirai, who mentioned different aspects of performance in various divisions and what that might mean for the future.
Sony is NOT selling the mobile division at this time. What is all the talk about a possible joint venture? Didn’t Sony do that already? Is this a flash from the past? What was the CEO talking about and what might happen in 2015?
Let’s take a look…
The News that Never Was
Much of the online tech world is spreading the news that Sony is selling its mobile division. It is not. Not yet, at least. Sadly, too few news sites are actually considering what the CEO said. Our wonderful and conscientious (yes I’m biased) Editor-in-Chief Sohrab comprehensively listed and discussed Kaz Hirai’s comments here.
Electronics in general, along with entertainment and finance, will continue to be an important business. But within that there are some operations that will need to be run with caution – and that might be TV or mobile, for example. The mobile and TV businesses both require a drastic overhaul. Without drastic reforms such as joint ventures or alliances, they will both be in the red three years from now.
Sony Corp. CEO Kaz Hirai
As our Editor-in-Chief laid out, Sony Corp. is suffering a loss still, the CEO has mentioned that no division has immunity, and many people are looking at the surprisingly hefty loss that the Mobile division is currently facing. Somehow, the net conclusion by many in the tech world is that Sony is definitely selling its Mobile division. That was not said. Also, we shouldn’t miss that Hirai mentioned the possibility of a joint venture or alliance.
Mobile’s Strategy Misfires
Why is the CEO even discussing any of this?
The Mobile division took a few years to get there, but eventually found success, such as reaching the #3 spot in Europe for smartphone sales and achieving a more influential, recognisable, and powerful brand in the Xperia name and also finally returning to the critical US market. It is true that they have made some mistakes in the past year however. The two-flagships-per-year idea seems to impress few people. Those of us who buy a delicious Sony flagship generally don’t like to see our slice of beauty become too old for the crown a short 6 months after it was even born. The tiny, tiny, incremental upgrades between recent flagships also wins no favour. At least Intel has a ‘tick-tock’ upgrade cycle, where the first model (chip development) is a major innovation, the second is a serious refinement on that (e.g. significant power savings and shrunken design) and then back to ‘tick’, a major new innovation. But Sony’s smartphone flagships have little more than a new number at the end.
Sony bet on China, and they failed – which they referenced to in their management discussion in the recent quarterly report. Essentially, the Chinese makers are dominating the show. Also, it’s an underreported fact that the consumer products of some cultures are not so popular in neighbouring Asian countries.
I’ve been a sharp critic of Sony’s mid-range smartphone offering for about a year now. I can’t figure out why they’ve done certain things. Misfires and miscalculations, I believe. To Western markets, the mid-range selection from Sony has thinned out. I hesitate to call the Xperia T3 a mid-range device (it’s fine if you do). The price tag in stores in Canada for this model bring it much closer to the flagships. The Xperia M2 and its upgrade, the M2 Aqua, are mid-range in the traditional sense. The Xperia E3 is a budget model. The Z3 is clearly the flagship, upper tier – and the Compact is only marginally cheaper. There are various models not released to Western markets. So what happened to Sony’s glorious and colourful fleet of 2012 mid-rangers that really got its name out there and cured the market with colour and design at a time when cell phone stores looked like a black slab collection?
In short, some key plans which could stabilise the Mobile division:
1. Return to one flagship per year.
2. Bring out more mid-range devices.
3. Get working on more budget devices for the Asian smartphone boom. Send a few of them to Western markets too, there is some demand.
What Will Sony Do?
As the selling off of the VAIO PC business and pushing out of the TV business has shown, selling, closing down and moving out are expensive and time-consuming maneuvers. Corporations like Sony don’t close down an entire division because of a couple of bad quarters. For maybe 2 years now, they have listed Mobile as one of the 3 key divisions for the entire corporation. That won’t change overnight. It would be more rational to try to stabilise Mobile and bring it back to profit. But, the entire Sony Corp. is on a shorter leash these days in terms of debt so drastic action is needed sooner rather than later. Plus, really considering the exact words that CEO Hirai used, it looks like he might be going for a joint venture or an alliance. How exciting. (And a bit sad for us Sony and Xperia fans of course).
Being honest, I haven’t the foggiest idea which company they might partner with. I wonder about the Chinese smartphone makers, but I’m not sure any of them really need help, they are doing so well. Samsung, despite its dip in profits, will probably rise again and doesn’t really benefit much from Sony, I think. LG? Maybe? BlackBerry? Ha that one is just a joke. Nokia? Didn’t Microsoft buy out Nokia? Not exactly. Only more recently it’s become clear that Microsoft bought the hardware division outright but the brand name only for 3 years. Nokia is expected to reSurface (I couldn’t help it). Nokia maybe? Hmm. Any player not in the top 5 would be particularly unexpected but not impossible. Attaching to a non-top-5 player would put Sony back fourteen years ago when it hitched its wagon to Ericsson. That cannot be considered progress. Will Sony put the Mobile division on a healthy diet?
Discuss:
What could Sony do to keep the Xperia business alive?
Related
What’s Really Happening at Sony’s Mobile Division?
News is spreading wide and fast that Sony is selling its mobile division, including iconic smartphones like the Xperia Z3 and tablet series. The “news” is the result of comments of Sony Corp. CEO Kaz Hirai, who mentioned different aspects of performance in various divisions and what that might mean for the future.
Sony is NOT selling the mobile division at this time. What is all the talk about a possible joint venture? Didn’t Sony do that already? Is this a flash from the past? What was the CEO talking about and what might happen in 2015?
Let’s take a look…
The News that Never Was
Much of the online tech world is spreading the news that Sony is selling its mobile division. It is not. Not yet, at least. Sadly, too few news sites are actually considering what the CEO said. Our wonderful and conscientious (yes I’m biased) Editor-in-Chief Sohrab comprehensively listed and discussed Kaz Hirai’s comments here.
Sony Corp. CEO Kaz Hirai
As our Editor-in-Chief laid out, Sony Corp. is suffering a loss still, the CEO has mentioned that no division has immunity, and many people are looking at the surprisingly hefty loss that the Mobile division is currently facing. Somehow, the net conclusion by many in the tech world is that Sony is definitely selling its Mobile division. That was not said. Also, we shouldn’t miss that Hirai mentioned the possibility of a joint venture or alliance.
Mobile’s Strategy Misfires
Why is the CEO even discussing any of this?
The Mobile division took a few years to get there, but eventually found success, such as reaching the #3 spot in Europe for smartphone sales and achieving a more influential, recognisable, and powerful brand in the Xperia name and also finally returning to the critical US market. It is true that they have made some mistakes in the past year however. The two-flagships-per-year idea seems to impress few people. Those of us who buy a delicious Sony flagship generally don’t like to see our slice of beauty become too old for the crown a short 6 months after it was even born. The tiny, tiny, incremental upgrades between recent flagships also wins no favour. At least Intel has a ‘tick-tock’ upgrade cycle, where the first model (chip development) is a major innovation, the second is a serious refinement on that (e.g. significant power savings and shrunken design) and then back to ‘tick’, a major new innovation. But Sony’s smartphone flagships have little more than a new number at the end.
Sony bet on China, and they failed – which they referenced to in their management discussion in the recent quarterly report. Essentially, the Chinese makers are dominating the show. Also, it’s an underreported fact that the consumer products of some cultures are not so popular in neighbouring Asian countries.
I’ve been a sharp critic of Sony’s mid-range smartphone offering for about a year now. I can’t figure out why they’ve done certain things. Misfires and miscalculations, I believe. To Western markets, the mid-range selection from Sony has thinned out. I hesitate to call the Xperia T3 a mid-range device (it’s fine if you do). The price tag in stores in Canada for this model bring it much closer to the flagships. The Xperia M2 and its upgrade, the M2 Aqua, are mid-range in the traditional sense. The Xperia E3 is a budget model. The Z3 is clearly the flagship, upper tier – and the Compact is only marginally cheaper. There are various models not released to Western markets. So what happened to Sony’s glorious and colourful fleet of 2012 mid-rangers that really got its name out there and cured the market with colour and design at a time when cell phone stores looked like a black slab collection?
In short, some key plans which could stabilise the Mobile division:
1. Return to one flagship per year.
2. Bring out more mid-range devices.
3. Get working on more budget devices for the Asian smartphone boom. Send a few of them to Western markets too, there is some demand.
What Will Sony Do?
As the selling off of the VAIO PC business and pushing out of the TV business has shown, selling, closing down and moving out are expensive and time-consuming maneuvers. Corporations like Sony don’t close down an entire division because of a couple of bad quarters. For maybe 2 years now, they have listed Mobile as one of the 3 key divisions for the entire corporation. That won’t change overnight. It would be more rational to try to stabilise Mobile and bring it back to profit. But, the entire Sony Corp. is on a shorter leash these days in terms of debt so drastic action is needed sooner rather than later. Plus, really considering the exact words that CEO Hirai used, it looks like he might be going for a joint venture or an alliance. How exciting. (And a bit sad for us Sony and Xperia fans of course).
Being honest, I haven’t the foggiest idea which company they might partner with. I wonder about the Chinese smartphone makers, but I’m not sure any of them really need help, they are doing so well. Samsung, despite its dip in profits, will probably rise again and doesn’t really benefit much from Sony, I think. LG? Maybe? BlackBerry? Ha that one is just a joke. Nokia? Didn’t Microsoft buy out Nokia? Not exactly. Only more recently it’s become clear that Microsoft bought the hardware division outright but the brand name only for 3 years. Nokia is expected to reSurface (I couldn’t help it). Nokia maybe? Hmm. Any player not in the top 5 would be particularly unexpected but not impossible. Attaching to a non-top-5 player would put Sony back fourteen years ago when it hitched its wagon to Ericsson. That cannot be considered progress. Will Sony put the Mobile division on a healthy diet?
Discuss:
What could Sony do to keep the Xperia business alive?
Related