“In a windowless room near Sony’s headquarters in the Shinagawa district of Tokyo, shelves hold hundreds of versions of the Walkman – the portable cassette player that turned Sony into a global brand when it hit the market in 1979,” Joel Dreyfuss writes for Bloomberg News.
“Today, the Walkman Room is a shrine to Sony’s past. The world’s No.2 consumer electronics company – creator of the first transistor radio, the compact disc player and the PlayStation game console – is struggling in the digital age,” Dreyfuss writes. “‘A 20th-century business model is no guarantee of success,’ said Nobuyuki Idei, 66, Sony’s chief executive and chairman. ‘This is the biggest challenge, how to change.'”
“Almost two and a half years after Apple Computer unveiled its iPod music player, Sony announced its first iPod competitor, called the Vaio pocket, this month. The delay – and a yearlong lag in starting the Connect online music service after Apple’s iTunes Music Store set up shop – reflects how hard it is for the 58-year-old electronics behemoth to adjust to new rivals,” Dreyfuss writes.
“Howard Stringer, 62, Sony’s vice chairman and head of the company’s U.S. divisions, says executives were so concerned about music piracy that they couldn’t agree with designers on the kind of player to create,” Dreyfuss writes. “‘We didn’t get there, and by that time, Steve Jobs was there,’ said Stringer, referring to Apple’s CEO.
“In April, Apple reported that second-quarter profit had tripled from a year earlier to $46 million, after it sold 807,000 iPods. The plunge in Sony’s stock price (Missteps cost electronics giant $100 billion in market value) shows change is needed, said Nobuaki Murayama, an equities manager at Cigna International Investment Advisors K.K. in Tokyo. ‘The environment has changed,’ he said. ‘It doesn’t take much investment to develop products anymore, and Sony is seeing more and more competition.’
Full article here.