Sony Corp Turns 60, Looks for Innovation

As the inimitable Sony Corporation turns 60 years old this year, the new CEO, a foreigner named Howard Stringer [ed: Stringer was named CEO a year ago], is trying to reign the company away from esoteric hardware that costs much more than what the average consumer would consider paying for such as the 13,300 audio console which automatically centered the CD as the user tossed it about.  So far, his efforts have been paying off, especially because the primary focus is in growth, while downsizing much of the bloat which has been plaguing the company in recent years.

The first of Stringer’s cuts were to the Qualia line of luxury items, which there was a very very small niche market for, which did not make up for the costs associated with the products, which include the aforementioned audio console and a micro-sized digital camera.  The Japanese corporation has also sold off nearly $1 billion in assets, reduced its stake in a Japanese retail chain that deals in non-electronics, scrapped the Aibo electronic-pet division, and stopped the production of plasma television sets.

More recently, the company has decided to veer away from the traditional Japanese business practice of promoting former executives to advisory positions, and has done away with 45 of these symbolic advisors due to the costs related to their position in the company.  That is to say, of course, they were not really contributing, but were still draining the company dollar, especially with their individually chauffeured cars.

Analysts are optimistic but wary, as Sony tries to grasp at a future of prosperity as it had seen from the 1960s to the ’80s, with the transistor radio, the walkman, color television, and other pioneering products.

This past Thursday, Sony had posted the results of the first fiscal quarter, a $276 million profit which is being credited to strong sales of LCD television Sets, laptops, camcorders, and digital cameras.  This is good news for a company which hasn’t seen a full year profit since 2002.

Sony President, Ryoji Chubachi, has mentioned that TVs and portable music are the areas in which Sony must show itself as a winner, stating “If we lose in either category, it’s inevitable that people are going to have doubts about Sony.”

Sony has been slow to jump onto the portable music boat due to fears that they will be eating their own tail by thieving sales of compact discs.  To complicate this, Sony had at first used the ATRAC3 file format on their portable players to hinder piracy, although they are now seeing the genius behind using MP3 encoding for the basis of their player.

Sony’s new LCD Television sets are commanding the TV market of late, although Sony had to work with the South Korean Samsung Electronics in order to play “Catch Up” on the world market.  It had appeared that Sony had been too confident in the cathode-ray tube paradigm of television sets and had not given much thought to the newer, sleeker sets.

Copyright 2006 Garian Cashman.  All Rights Reserved.  This material may be re-broadcast, re-published, re-written, or re-distrubuted as the user sees fit provided this notice is retained in any and all copies.