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Sony Fragmented

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For decades, Sony has been synonymous with technology.  From TVs to camcorders and cameras, games consoles to PCs and now entering the tablet Market, Sony has established itself as a prominent player in the electronics and digital entertainment industries.  However, the corporation has seen it’s position slide over the past decade, with massive shifts in almost all of it’s markets.

Sony grew tremendously over two decades, with revolutionary products and technologies like the Walkman, Trinitron TVs and the Playstation games console defining, growing and advancing the industries they sought to conquer.  However the increase in competition and the pace at which new technologies emerge made it difficult for Sony to maintain it’s dominance.  The arrival of the iPod signalled the end of the Walkman, which like every other device has failed to compete with Apple’s digital media devices and Trinitron technology, the heart of Sony’s CRT TVs was made redundant by the advent of LCD HDTVs.  Sony knew it had to adapt and change to meet the diverse needs of an evolving world.

Fragmented Sony

In June 2005, Sony appointed Howard Stringer as CEO, marking the first time a foreigner has been given the position.  At the time, the British-born businessman said he would bring the group together to offer better products and services.  Since then, Sony has seen major changes to some of it’s divisions, but continues to suffer substantial losses and still doesn’t have the kind of prominence it had just a decade ago.  The corporation’s market capitalisation fell behind one of it’s biggest rivals in the games industry in 2007 when Nintendo rose to second place in Japan, adding to the already humbling market conditions Sony experienced.

However, one division has continued to perform strongly and consistently throughout this trying decade.  Sony Computer Entertainment, which is responsible for the highly successful Playstation games consoles, has been very profitable and offset some of the losses of other divisions.  Sony’s entry into the console space solidified a new source of profit and the latest generation, the Playstation 3, is the most forward thinking yet and is now in it’s prime with exclusive titles and the power of the hardware finally paying off.  Yet despite the success these products, Sony is still fragmented, a collection of separate divisions that lack a common focus.  A prime example of this was the distribution of the James Bond films, something under the purview of Sony Pictures and yet they were available on Microsoft’s Xbox 360 Market place before Sony’s own Playstation Network store.  This is exactly what Sir Howard was talking about addressing when he took over Sony in 2005.

Playstation Buttons

What Sony lacks is a common focus and an integrated environment in which consumers can experience it’s products and services.  The Japanese corporation needs to leverage it’s considerable resources to create an unparalleled experience by directing the different divisions to a common goal.  Sony has great influence in consumer electronics, video games, film and music and combining these resources would result in a more cohesive company with focus, direction and a global image that is unique.  If Sony can achieve this coherence, it may once more lead innovation and technological advancement and see a return to prominence.


Written by atalukdar

May 30, 2011 at 1:00 am