Sony Reorganizes Television Management Again

See the article below - Sony continue to struggle with their TV division. Trying to find a way to be profitable in the industry has been extremely hard. Panasonic just recently complained about how quickly TVs are becoming a commodity.

Still a lot to be said for understanding the Customer (not retail partner, but actual TV purchaser), and getting the right featured product at the right price for them. This is no easy task considering what the BRANDS want to do for their BRAND, as well as the Retailers want to do for their brand. Getting through the Component mess, past the brand marketing stuff, and working with retailers strategy is an incredible challenge to get product to the market a customer WANTS, and is willing to pay a certain price for.

Doing it = PROFIT , not just for the Brand, or the Retailer, but the value the customer receives has everyone win.

Is is time the consumer electronics industry got back to figuring that out. We will only continue to have success around flashy marketing / product of the moment which is not one that can be maintained.

JZ

 

Sony Reorganizes Television Manufacturing Business in Drive to Stem Losses

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By Cliff Edwards and Takashi Amano - Nov 1, 2011 3:32 AM PT

Sony Corp. CEO Howard Stringer

Chris Ratcliffe/Bloomberg

Howard Stringer, chairman and chief executive officer of Sony Corp. said TVs remain vital to Sony’s sale of related products, including Blu-ray players and video cameras.

Howard Stringer, chairman and chief executive officer of Sony Corp. said TVs remain vital to Sony’s sale of related products, including Blu-ray players and video cameras. Photographer: Chris Ratcliffe/Bloomberg

Sony Reorganizes Television Business in Struggle for Profit

Kiyoshi Ota/Bloomberg

Customers look at Sony Corp. Bravia televisions at an electronics store in Tokyo, Japan.

Customers look at Sony Corp. Bravia televisions at an electronics store in Tokyo, Japan. Photographer: Kiyoshi Ota/Bloomberg

Sony Corp. (6758), reeling from seven consecutive annual losses in television manufacturing, plunged the most in more than seven months in Tokyo after announcing a reorganization of the business into three groups.
One group will oversee the liquid-crystal-display operations, another will coordinate contract manufacturing and a third will oversee the development of next-generation sets, Ayano Iguchi, a spokeswoman, said by telephone. The changes take effect today, a day before the company announces earnings.
Sony, which sells products ranging from PlayStation game consoles to life insurance, is trying to compete against Samsung Electronics Co. and low-cost TV set maker Vizio Inc. in an industry where sales have stagnated in developed countries. Chief Executive Officer Howard Stringer has said TVs remain vital to the Tokyo-based company’s sales of related products, including Blu-ray players and video cameras.
The stock slumped 6.3 percent to 1,576 yen at the close of trading in Tokyo. Sony has lost 46 percent of its market value this year, compared with a 16 percent decline for the broader Topix index.
Samsung, the world’s biggest TV maker, has gained 4.3 percent this year and LG Electronics Inc. (066570), the No. 2, has dropped 38 percent.

Smart TVs

Sony makes LCD and LED TVs, sets that connect to the Internet using Google Inc.’s Android operating system and models that let users watch video in 3-D. The company uses other manufacturers, including Taipei-based Hon Hai Precision Industry Co., to produce lower-end sets.
Sony has indicated it will create a separate unit to handle the commodity hardware side of the TV business, said Ben Bajarin, director of consumer technology practice at consulting firm Creative Strategies Inc. in Campbell, California.
The other units would be free to work on so-called smart TVs, which are more expensive sets that can pull content off the Internet, Bajarin said in an interview. These groups also would look at using Sony’s music, movie and video-game assets in high-end TVs, tablets and smartphones.
“They are taking a much harder look at the three pillars of their business,” Bajarin said. “It makes sense for them to have more of the manufacturing side outsourced.”
Investors have been awaiting the company’s turnaround plan after Sony, Japan’s largest exporter of electronics, announced in August that a strategic review of the business was under way.

Panasonic, Toshiba

“Sony needs to focus on the strength of its mobile and set products,” Eiichi Katayama, a Tokyo-based analyst at Bank of America Corp., wrote yesterday.
Other Japanese TV manufacturers also are trying to turn around their business. Panasonic Corp. (6752), the maker of Viera televisions, yesterday forecast its biggest annual loss in 10 years and cut its annual TV sales target to 19 million from 25 million.
Toshiba Corp. (6502), the maker of Regza televisions, said profit fell 19 percent as a strengthening yen eroded overseas sales. The falling prices of TVs and the end of a sales boom triggered by switching to digital broadcasts in July hurt the audiovisual division, the company said in a statement yesterday.
Toshiba’s TV business had an operating loss of at least 10 billion yen in the six months ended Sept. 30, Corporate Executive Vice President Makoto Kubo said.
To contact the reporters on this story: Cliff Edwards in San Francisco at cedwards28@bloomberg.net; Takashi Amano in Tokyo at tamano6@bloomberg.net
To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net; Michael Tighe at mtighe4@bloomberg.net