“Sony Corp warned of a fourth straight year of losses, with its television unit alone set to lose $2.2 billion on tumbling demand and a surging yen, sinking its U.S. shares and raising concerns about the viability of its high-profile TV business,” Isabel Reynolds reports for Reuters.
“The maker of Bravia TVs, Vaio computers and PlayStation game consoles cut its sales forecast for TVs, cameras and DVD players on Wednesday and said it may report a 90 billion yen ($1.1 billion) net loss for the current financial year, scrapping its earlier net profit estimate of 60 billion yen,” Reynolds reports. “Sony U.S.-listed shares were down 6.8 percent at $18.36 in afternoon trading.”
Reynolds reports, “‘When you have competitors like LG (Corp ) and Samsung so aggressively attacking the (TV) market, it really does hurt margins,’ said Michael Yoshikami, chief executive of YCMNET Advisors, adding that Sony needs to compete on price. ‘If they can’t, they need to get out of the (TV) business… I don’t think they are really a brand at this point that can really command a premium price,” he added.
MacDailyNews Take: Ouch.
“The warning by Sony marks the erosion of its standing in the technology world. Back when Sony, led by co-founder Akio Morita, launched the Walkman, it proved an inspiration to the founders of a then-little-known start-up company: Apple Computers [sic],” Reynolds reports. “Now Sony is struggling to come up with hit devices and finds itself outmaneuvered in TVs by Samsung and in the booming smartphone market by Apple.”
Read more in the full article here.
MacDailyNews Take: If Apple decides to enter the TV market, Sony’s going be hating life even more than they are today.
And Apple wants to get into the TV set business?
Apple’s best innovations are in its interface designs. To succeed in TV with their usual premium pricing (they won’t be able to compete on specs if they only update one or two models every year and refuse to lower prices), they must blow away the current remote control interface.
How I see it: a TV remote control with only the basics: channel/volume, maybe menu/select and input–anything that requires just one or two button presses to accomplish.
But for more advanced commands, like finding programs, jumping to a specific channel, record to a built-in PVR (cutting out the expensive PVR that comes with cable/satellite boxes), etc, you control it through a Siri button on the remote (the TV itself wouldn’t have Siri, you’d have to shout across the room to be heard).
I thought about just having an app on your iPhone/iPad/iPod touch for the basic controls and Siri voice bridge, but volume and channel you want access to immediately, and leaving the iOS device screen on with those controls up for the entire time the TV is on would drain battery very quickly.
The cell phone business didn’t look all that great in 2006 either.
Not that I’m in favor of Apple making TVs. I’m just saying.
Object lesson for us Apple fans: no company stays on top forever, consumers are too fickle and eventually will turn on you.
Nothing to do with Apple. If the company will continue execute Steven Jobs’ approach, then it will strive as long as it gets even without ever producing another revolutionary product.
Apple just have to continue making innovating smartphones, tablets, Macs, iPods, and consumers will not be able to be “fickle”.
Sony produces too little innovation lately to be as distinctive as the company was, but still has higher prices.
well at least as soon as you stop making amazing products. Sony has been coasting, similar to what apple did after dismissing jobs. But Apple’s rebirth (post jobs return) is a example that all it takes is to return to your roots of bringing out innovative amazing & high quality products.
Sony can pull out of this downward coast, but it will take a shake up and a return to the company they were, not the company they have become.
If you look at a LATTE curve, corrected for PBAJ and BAKE, on a CNDY graph, AAPL has a good 5 years before it has to worry. But no company can be complacent forever. That’s where a BEEF graph comes in handy- AAPL’s rapid ascent indicative of movement, in *any* direction, over 5 years. At one time Sony seemed invincible as well.
Sony was invincible while they were making high quality innovative products. Once they stopped that they were coasting, and you can only coast so long.
Apple’s was led by jobs but the real product innovation has been driven by Ive, Forestall and others for a couple years now.
You are correct Apple COULD easily coast for the next 5 years, but they aren’t coasting (at least not yet)
The dawn of Sony’s downfall was when it started to join the Microsoft’s harem as did HP and the rest of tech titans such as Dell. Here they left their brains behind and hoped that Microsoft would featherbed them forever. But it was not to be as these concubines claw at each other to the bottom of the price heap. Microsoft was laughing to the bank.
Mediocre companies never seems to learn from the Microsoft’s episode. The new harem now is the Android’s.
Panasonic (formerly Matsushita Electric Industrial) announced even bigger losses this quarter.
Samsung Electronics remains hugely profitable, even though their profits significantly lowered due to losses in TV/panel business.
To watch Matsushita, renamed Panasonic, treading water is particularly sad. I have plenty of their gear and love it. These are markets where there is no longer much innovation, allowing price under-cutting from imitators (LG, Samsung, ad nauseam) to gouge away at the former innovative leaders.
If Apple CAN innovate the TV, they could pull another coup and wipe the floor with the usual imitators once again. We shall see.
Sony potentially being undone by the Korean manufacturers over price? Wow. Cry me a river. Didn’t the post war Japanese electronic manufacturers do this to the US makers? Anyone remember Zenith, RCA, Westinghouse, GE, and the last manufacturer here, Curtis Mathis? Different times to be sure, but the only similarity is the race to the bottom on COST. when the only differentiation is cost, lowest price wins. Sony, welcome to the new order. Innovate to stay ahead of others, and make it attractive for folks to spend slightly more for your brand, or be run over. Innovate or die? Hmmm, reminds me of a fruit themed computer company’s unwritten motto…can’t place the name…
Yes indeed, Japan did this. However, what has been remarkable about Japan has been their drive to create and innovate. The world is better off for Japan’s remaking the technology market.
Meanwhile, does anyone seriously expect ANY innovation from the Koreans or Chinese? I sure as shite don’t.
In case you hadn’t noticed:
The entire WORLD is having a “race to the bottom” in everything business. Apple essentially stands alone at this point. That’s bad.
When Sony introduced their post-iPod digital music player, they used their own whacky file format. What was that al about?
Wasn’t so much they used their own whacky file format, it’s that you couldn’t play normal files (mp3s) on it at all, you *had* to use the SONY one, even converting your mp3 files to work in their player. Even Microsoft wasn’t that stupid.
ATRAC, not to mention Sony was accused of placing some form of spyware on your machine too.
A separate issue from their player, but yes the “protected” CD garbage damaged their brand badly for a time.
I love going to the Mall in Woodland Texas, there is a Sony store just a few stores down from the Apple store and every time I go there is 1 maybe 2 customers in the Sony store and the Apple store is packed! That’s got to suck knowing so many people walk right by your store n even though you have all kinds of TVs n computers and all no one stops.
Sony tried to create a family of devices that would create a halo for each other, before Apple did. Unfortunately for Sony, their concept was built around their Memory Stick Take pic with Sony P&S on Mem Stick, move Mem Stick to PC or TV to watch. That sort of thing. It didn’t work. The value add was too low. People went out of their way to avoid the Mem Stick, etc. Besides Mem Sticks were way expensive. Noone wanted to join for obvious reasons.
The bean counters are in charge and they have been coming up with losses for three years now. What agony!
Bean counters in charge – it is what killed GM. However, it took decades.
Marketing-As-Management = corporate death.
I saw this coming years away…
Sony used to be the premium producer of excellence, and I had many of their products right up to about 10 years ago.
Then they sorta lost their mojo…
Actually, all is not lost – the NEX camera range is pretty good.
A few years ago, Sony exited the plasma TV business to concentrate on LCD TVs. Their partner in the business, producing the “glass” as the industry refers to the panel itself ? Samsung. That partnership has certainly served Sony well. Hopefully, Apple won’t learn the same lesson in the same way.