Wednesday, November 16, 2011

Sony's Not Dead (yet)

This post is in response to Carl's two excellent sets of graphs depicting Sony's recent decline.

There is no doubt that Sony has faltered in the last several years and is losing ground to more innovative companies such as Apple. However, there is at least some reason not to discount Sony quite yet.

The Wall Street Journal has a great article outlining Sony's intention to innovate internet-based TV. Howard Stringer (Sony's CEO) has also mentioned a innovative new line of television sets, which he claims will claim a premium price, restoring profitability to the ailing line.

Of course, we've heard these claims before. Apple tried and failed to negotiate with content providers over a more integrated set of broadcast channels to provide via the internet. Will Sony succeed where Apple failed?

We've also heard rumors that Apple is creating a Siri-voice recognition powered television set for the 2012 or 2013 market, so will Sony's new television be ground breaking enough? The path is certainly not clear for Sony, but there is at least a couple reasons to believe that they haven't checked out of the race just yet. Of course, going toe-to-toe with Apple in gaming may get even more challenging in years to come, further emphasizing Sony's gaming decline. It should be an interesting show!

1 comment:

  1. Although I agree and also think that Sony is not yet dead, I don't think a TV will be what saves Sony. Manufacturers like Samsung, which also manufacture mobile phones, tablets and computers, have already starting building such platform, so Sony will just play catch-up. Other than eventually having voice-recognition like a possible Apple TV, what else can you bring to a TV set that helps Sony jump to the leading position? The differences between TV sets from different manufacturers nowadays are minimal, you can only have so much contrast, refresh rate and size. You can see TV prices dropping like rocks (and margins as well, I am sure), even for the latest models, hardly any model can command premium prices.

    The difference will be the content for sure. As time goes by, content providers will see it more clearly that cable TV is dying, so they will start re-thinking their strategy, and start making deals with Sony, Apple and the likes. The same way the war between Hulu Plus and Netflix is playing out. There is one difference, customers are used to Hulu and Netflix as content providers, but that took a while. The general public is not yet used to getting their content from TV set manufacturers, so it will take some time for people to decide to buy a Sony TV because it comes with HBO or ESPN.

    So, again, something else will have to save Sony, they cannot wait for a TV to do it.