Moody’s reviews beleaguered Sony for possible ratings downgrade

“Moody’s Investors Service put Sony Corp. on review for a possible ratings downgrade Monday, citing doubts about the troubled Japanese electronics company’s revival plan announced last week,” The Associated Press reports. “The review reflects concern that Sony’s mid-term business plan will be unable “to regain the strong profit and cash flow generation patterns seen in its past,” Moody’s said in a statement, adding that the survey could lead to a downgrade of the A1 ratings of Sony and its supported subsidiaries. That’s four rungs below the top credit rating, Aaa.”

The Associated Press reports, “The shake up calls for slashing 10,000 jobs, or about 6 percent of Sony Corp.’s global work force by the end of March 2008. It will also close 11 of its 65 manufacturing plants and shrinking or eliminating 15 unprofitable electronics operations by the same deadline. Sony refused to say what those businesses were.”

“Aside from the cost cuts, Sony said it would now focus on so-called ‘champion products’ including the PlayStation 3 next-generation video-game console, Bravia liquid crystal display televisions and the Walkman MP3 music players _ which have fallen miserably behind Apple Computer Inc.’s iPod,” The Associated Press reports. “Analysts generally were not impressed by the plan, saying it lacked vision and creativity… investors drove down Sony’s stock 120 yen, or 3.1 percent, to 3,820 yen. The stock has lost about two-thirds of its value over the last five years.”

Full article here.
Walkman MP3 players are “champion products?” No, they’re not. Sony ought to forget it, it’s too little, too late. They lost the portable digital music player market long ago. Focus on TVs and game consoles, Sony, those are markets where you still have a chance to do well. Also, figure out better and more ways to work closely with Apple, instead of petulantly withholding your music label signatures and delaying iTunes Music Store Japan and Australia.

Related articles:
Struggling Sony to cut 10,000 jobs, slash factories – September 22, 2005
Sony to announce turnaround plan on September 22 – September 12, 2005
Sony’s new Windows-only ‘Connect Player’ bears eerie resemblance to Apple iTunes – September 09, 2005
Too little, too late? Sony getting killed by Apple in digital audio – September 09, 2005
Also-ran MP3 player makers miffed by Apple’s impossibly low price for iPod nano – September 09, 2005
Sony and Warner holding out on Apple iTunes Music Store Australia – September 08, 2005
Sony Connect President in wake of iPod nano: ‘we will accelerate our challenge’ to Apple iPod – September 08, 2005
Apple close to deal with Sony for ‘online music download service for Japanese iPod users’ – September 05, 2005
Bad news for Sony: millions worldwide choosing Apple iPods – August 22, 2005
Sony to combat music market ‘maestro’ Apple Computer with ‘Walkman Beans’ – August 18, 2005
Musicians stage mutiny against Sony, defiantly offer music via Apple’s iTunes Music Store – August 10, 2005
Apple’s Japan iTunes Music Store debut more bad news for Sony – August 04, 2005
Sony debuts US$199 1GB iPod shuffle killer, bills it ‘small as a pack of gum’ – July 06, 2005
Sony BMG and EMI try to force Apple to ‘open’ iPod with iPod-incompatible CDs – June 20, 2005


  1. I know some people ridiculed Microsoft for reorganising it’s business model but it actually made sense. Whether it works is another matter.

    However, from the minimalist details in this story (i.e. slashing jobs and outlets) Sony may get the nod from the market but all it says to analysts is: “Sony is in trouble”. I’d like to see more details before I make further comment.

    Oh and a special note to j. So you got the first post. Good for you. Pity you had nothing to relevant to say.

  2. Here we go again.

    I am interested in what Apple competitors are doing. Sony is one of those. MDN does great work. Keep it up guys (gals), you are appreciated!

    300 pound geeks (vegging behind their keyboards… upset because Apple isn’t making enough exciting news to fill their screens when they click on MDN every five minutes) need to get back to work. Those who live for the “first post” need to drag themselves from their computers and get a life.

    Everyone else, have a nice day! ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

  3. Y’know, I can’t help but feel a little sad. I like Sony. Okay, so the Network Walkman is a half-assed, Windows-only iPod competitor. But my wife and our friends are huge PlayStation fans. My Sony Trinitron computer monitor lasted for 8 years and three computers and looked great right up until the end. My parents love their Sony DVD player, and I have a shortwave radio from Sony that is just awesome.

    Hopefully Sony will get it’s act together. I’d really hate to see them go.

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