After weeks of rumors running rampant about Sony buying the remaining 50% share of Ericsson, their mobile partner in Europe, the two companies have announced the full purchase and takeover of operations by Sony Corp. Just earlier this week, Sony’s executive deputy president, Kaz Hirai, danced around the subject of a takeover of Ericsson.

 

I’m not going to comment on the speculation. After April, when Sony made its latest reorganization, one of the things I’ve done with Sony’s CEO and Sony Ericsson’s CEO is recognize that Sony Ericsson is an important part of Sony’s overall strategy, and that the two are in lockstep, whether it is a joint venture or not. That’s one of the things we are embarking on.

 

Under this new deal which will have Sony bring all mobile smartphone operations in house, Ericsson, their partner since 2001 will receive 1.05 billion euros($1.45 billion) in cash for its 50 percent share of the venture.

 “We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment,” Sony Chairman and Chief Executive Sir Howard Stringer said in a statement. 

In regards to the large amount of IP held by Sony Ericsson, both companies will enter a cross-licensing agreement which covers products and services while Sony will be given “ownership of five essential patent families relating to wireless handset technology.” A large part of this move was put into place because Sony Ericsson fell to 6th place in the mobile handset industry while rivals like Samsung, who also use Google Android platform, have thrived, and Apple and the iPhone have continued to dominate.

 “This acquisition makes sense for Sony and Ericsson, and it will make the difference for consumers, who want to connect with content wherever they are, whenever they want,” Stringer added. 

Sony hopes that by bringing all operations in-house, they can better promote the brand and integrate it with other Sony products and services. No timetable was given for the complete transition, nor a name, but many expect that all future handsets will simply be under the Sony title.

Discuss:

Do you think that Sony will benefit by bringing all mobile operations in-house?

[Via NYTimes]