Sony's New CEO To Look Beyond Hardware

angry tapir writes "Sony's new CEO says the company needs to move on from its hardware roots. From its inception, the company has defined itself through its gadget lines — Walkman, Vaio, Cyber-shot, PlayStation — but incoming CEO Kazuo Hirai, who will officially lead the company from April, says Sony must now focus more on the software and platforms they access. He said he wants to model the company after its successful PlayStation gaming business, which he helped turn around, where 'hardware drives software, and software drives hardware, and it's all tied in by the network.' Sony is forecasting nearly US$3 billion in losses for the fiscal year through March."

Comments

It's not going to work

[laffer1]

Sony is just too conservative and unwilling to invest to be successful in the software business. 90% of their time will be spent locking down systems and adding DRM. They won't build what the customer wants.

Re:It's not going to work

[Solandri]

No, what you're describing is the public perception. What he's describing is the reality. Most of the big-name "computer manufacturers" aren't really hardware manufacturers. Apple's laptops are designed and made by Quanta. Apple gives them some guidelines and requests some modifications, but the design and manufacturing is done by Quanta. Ever wonder why some of the HP laptops look a lot like MacBooks? It's not because HP is copying Apple. Quanta is also the primary original design manufacturer for HP. Literally the same Taiwanese people who designed and manufactured the Macbooks also designed and manufactured those HPs.

The same goes for other products. The iPod and iPad by now I think most people know are made by Foxconn. Who designs them is still uncertain. The big name sellers and the OEMs/ODMs are very reluctant to publicly discuss who makes what. The CPUs in their mobile devices are made by Samsung, though it looks like Apple is burning that bridge and is trying to design their very own ARM CPU for their next gen products.

So Apple is essentially a middle-man. Someone who comes up with an idea, hires a outside companies to work out the design details and manufacturing, then assembles and imports it, and sells it under their brand name. A parts assembler. A marketing company. Many other companies you may think are hardware companies do this too. IBM used to make their Thinkpads in-house, but as near as I can tell Lenovo has outsourced most of their laptop production to ODMs. A lot of Sony's low-end and mid-grade laptops are made the same way. Dell just orders the different parts of their desktop computers, and assembles them before shipping it off to you.

But some of them do have their own design, fab, and production facilities. Dell designs their own motherboards and cases (and tests them pretty extensively - it's extraordinarily difficult to put together a custom PC that's as quiet as a Dell business desktop). Sony's high-end laptops are designed and built at their facilities in Japan. The same for the sensors for their cameras, which they also sell to other companies (most of the other digital camera "manufacturers" use Sony sensors - a huge opportunity Kodak missed because they didn't have silicon fabbing experience). So they're very much a hardware company.

I'd characterize Apple as a software and online services company first (OS X, iOS, and iTunes are their bread and butter), marketing/assembling second, and hardware a distant third.

Ok

[Anonymous Coward]

Hardware is becoming generic and software is becoming critical. Software should at least be a big part of the plan. Sounds reasonable enough to me.

I'd rage about Sony evilness ... but that would be offtopic (and I'm sure there will be plenty of that anyway by people much more serious about it than me!).

overpriced, underspecced.

[Anonymous Coward]

Maybe Sony hardware used to be worth the premium, way back when, but nowadays they are just trading on their reputation.

I had a Sony Viao laptop for years. It was OK, nothing wrong with it, but equally there was nothing so amazingly right with it that it was worth the huge pricetag - the same spec laptop with another brand label on it would have been just as good at 2/3 the price. It's a shame, because there is room in a market for a gadget manufacturer that sets itself apart from the competition by offering superior reliability / build quality / robustness.

I think customers have been catching on to this the last few years, and Sony's hardware sales have dropped as a result.

Re:overpriced, underspecced.

[unixisc]

The brand name meant something when it actually was made in Japan. Once they started outsourcing to China, like everyone else, there's no reason to pay more for them than anyone else.