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'Sony Needs a Fresh Hit' (bloomberg.com)
Even as Sony's CEO Kazuo Hirai has done a remarkable job over the past five years -- taking bold decisions on the areas the company should be focusing on, and cutting efforts on those that aren't working -- his company desperately needs a fresh hit to boost its revenue and to become relevant in the mind of most, writes columnist Tim Culpan for Bloomberg. An except from his article: According to a company statement Tuesday for investors' day, the key will be to "remain the 'last one inch' that delivers a sense of 'wow' to customers," expand recurring revenue, and pursue new businesses.Those three strategies are closely linked. With TV sales in decline, its Vaio PC business spun off, and its smartphones barely a blip on the radar, Sony's last inch is heavily dependent on the PlayStation. Sony's Game & Network Services business has grown at both the top and bottom lines over the past five years, but the games console business is stuck in time. [...] Sony needs to build a device that will be far more ubiquitous and can appeal to consumers beyond the current male-skewed slowly aging hard-core gamer base. Amazon and Alphabet, with Echo and Home, are two such examples, and Apple will probably follow suit. With its background in audio, video, sensors and entertainment, Sony has all the right parts to make it happen. For the company that invented the Walkman, dreaming up another hit shouldn't be so hard.
Sony lacks the organizational cohesion to deliver on any product line or strategy that crosses business unit boundaries, and an obsession with proprietary formats that makes economies of scale impossible to achieve. The Playstation brand is succeeding in spite of Sony, not because of them.
Maybe Sony can produce a new Spiderman movie, it would sure to be a hit.
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It's pretty stupid to cite the Walkman when trying to guess where the future of Sony lies. The Walkman was the vision of one man, the co-founder of Sony who was an engineer and a tinkerer at heart. He was also the man responsable for having pushed Sony to produced the smallest world band radio receiver ever. He didn't care wether it was financially feaseble or not, he said do it and his underlings said ok. Sony of the past (ie pre- Columbia acquisition) was a company that had vision. It was a company made by engineers pushing the envelope. Today Sony is competely different. It's a company driven along by marketing people and other pencil pushers. The engineers are relegated to the dark corners of the room. Seriously, the engineers at Sony are top rate, it's just the that every project they work on is sabotaged by their "entertainment aka Mr-DRM division" all the time. So you end up with crappy overpriced products. It's no wonder the Koreans ate Sony's lunch.
Music? Films? Electronics? That's kind of like saying Disney needs a hit.
The Daddy casts sleep on the Baby. The Baby resists!
They are too stuck on vendor lock in and DRM. Instead of relying on consumer loyalty by making good products, they try to rely on forcing customers to only buy Sony stuff whether it meets the needs it not. Back in the day when people built component stereos, people could mix and match and many bought Sony components with others like say a Sony amp and a Dual turntable. If it we're today, Sony would only allow you to use a Sony turntable with a Sony amp. People are sick of that shit.
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OK, so it's not a mass-market product. But their mirrorless camera bodies, in the A7 and new A9 manifestations, should be making Canon and Nikon a little nervous right now.
Don't disappoint your bird dog. Go to the range.
For the company that invented the Walkman, dreaming up another hit shouldn't be so hard.
That's oversimplifying just a smidge, methinks. The Walkman was the evolution of the handheld transistor radio, and depended upon the existence of the audio cassette tape; nobody was carrying around a 'portable' 8-track player.
What the author fails to differentiate is the fact that Sony owned the portable media playback market with the Walkman (and largely the Discman) at a time when things were primarily hardware. Everything is software now - games, apps, music, movies...it's all files/programs on a storage medium somewhere, and at the hardware level,it's basically "things that play software and read files" in one shape or another. Competing in that world is rather difficult as differentiating is almost invariably a detriment to the product.
I'm certain there are niche areas being ignored where Sony could own a few very small markets, but having 80% marketshare of a dozen 20,000 unit markets isn't going to make the accountants happy if their metric of success is the Walkman or the Playstation.
I'm not saying that Sony *can't* do it, but blockbuster products have a whole lot of ingredients, not the least of which are both luck and mass appeal. Finding the new thing everyone wants, and introducing it the right way, at the right time, at the right price, is not something that can be decided in Excel. After all, every company is trying to do it.
Sony actually had a prototype MP3 Walkman at some point but was forced to give up on the project due to fighting with their audio division over concerns of consumer copyright issues which resulted in Apple pretty much stealing their lunch in this area. Otherwise I wouldn't be surprised if mp3 walkmans would have existed instead of Ipods. Sony had an amazing line of VPC-Z series laptops which were actually assembled in the US or Japan. I own one that's almost a decade old and it's still on par with modern laptops in performance, weight and size. (Think Razor like laptop) Sadly after I believe a tsunami wiped out their manufacturing facilities and problems with their overall company forced them to sell away their Vaio line. They were one of the first companies also to experiment with hybrid graphics and external gpu cards on their laptops. They also sold one of the first consumer OLED displays that cost more than common sense too. So it's not that their products were bad, it's a lot of bad execution and decisions.
I'll grant that they've come a long way from the rootkit scandal, such as when they responded to the Xbox One's original, draconian policy of tying discs to consoles so friends couldn't loan games to each other with their own, much better policy for sharing games, but that rootkit debacle destroyed a lot of trust.
I consider myself to be one of the more lenient ones around here, in that I'm fine with owning other products of theirs, provided they're sandboxed or disconnected from anything important, but the notion of running a Sony-developed OS that has the ability to tell them everything about my life? Not until I'm convinced their interests align with mine, which is to say, not a chance in hell as long as they are one of the major players in the media industry.
You could say the same thing to Apple and its stagnating product lineup
Yea Apple needs to invent iResurrect. Love him or hate him, Jobs had a talent for finding and marketing that "next big thing" and he had the influence to make it happen. I don't think Apple is going to die off tomorrow but I don't see any really big, new products coming from them. I don't think they are going to have another Mac, or iPod, or iPhone moment again.
I browse on +1 so AC's need not respond, I won't see it.
Sony (Electronics) has had a long history of being innovative. The problem often has been that they've had a long history towards pushing proprietary formats and devices. Some of those have been successful, many have failed to catch on, and some were spectacular failures (Betamax).
Somewhat ironically, their Android phones are relatively open - the failing there is likely that the devices are bland compared to an iPhone, and sit somewhere between a pure Android (a la Nexus/Fi) and a fully vendor customized setup a la Samsung. They haven't managed to establish a market niche with them, let alone dominate.
As for consoles, I'm not holding my breath on expectations that the Scorpio will be as dominant as you think. 4k gaming takes serious horsepower, and it's not cheap, even today. Past history shows that 'best hardware' doesn't always win, because there's a lot of other factors involved (price being one of them). That's not to say that the PS4 is going to 'win', though it's currently outsold the Xbox1 by about a 2:1 ratio. I find it ironic though that you slam the PS4 over something that is EXACTLY true of the Xbox1 though - they're both (an) "underpowered PC with added DRM".
Now, what would make me look at Sony products again? It doesn't have to be a world-breaking innovation, but there are definitely a few things that they could do, just off the top of my head:
1) Improve quality back to premium level. Sony products today are pretty much the same mediocre quality as everyone else's, because they're largely made in the same Chinese/etc factories, and use the same Chinese/etc parts. I'd pay slightly more for better quality, but I have to know I'm going to get it.
2) Strive for openness. Sony has a bad history, but they can do a lot to get past that. You don't need to choke the market to be a leader, and the downside of a failed proprietary format is way worse than an open one. They need to do more things the way they handled the game-sharing aspects in the runup to PS4 vs Xbox1, where Microsoft started talking about restrictions on sharing games, reselling etc, and Sony came out and mocked them for it (brilliantly), causing Microsoft to have to ditch those plans.
3) Get rid of the film division. Following in part with 2, get rid of the film division so that you're not tied into the entertainment side of things, because the studios/etc are always pushing for anti-consumer things.
Years later, I still refuse to buy any Sony products. They deserve all the misfortune they receive.
> The problem often has been that they've had a long history towards pushing proprietary formats and devices. Some of those have been successful, many have failed to catch on, and some were spectacular failures (Betamax).
I mentioned Sony's long line of failures back in 2014.
Sony's completelyfailed to understand the importance of buying digital music. Apple's iPod and iTunes wasthe digital walkman.
This is why Apple has a market cap of $800 Billion and why Sony only has a market cap $44.85 billion
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The PS4 Pro should have been called the PS4K and played 4K Blu-Ray.
The Rootkit scandal wasn't even Sony. It was BMG, a company that was later acquired by Sony. There were no Sony executives involved. There were no meetings in Sony headquarters about including a rootkit. Furthermore, there were no computer viruses that used the rootkit as an attack vector, as like nobody listened to CDs in their CD-ROM drive. Plus, this all happened like 15 years ago. I think it's time to let it go.
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I mean as far as consumer facing products go (which is really what this article seems to be looking at) Sony is three things: Media (TV*, movie, music studios), console gaming, and consumer electronics. Unfortunately that last market is a walking corpse right now. TVs are a commodity these days, with the difference between high end brands and low end discount brands being trivial to everyone but the home theater enthusiasts. And speaking of home theater, that's going back to being a niche market after growing rapidly in the late 90's and early 00's due to DVD, and Sony isn't even a strong player in it these days anyway. Even plain ol' TVs are falling out of fashion with younger consumers who prefer watching on phones and laptops. Don't ask me to explain that trend; I can't. I don't get it either but it's a reality that electronics companies are going to have to face. Physical media sales (and Sony's lucrative patent licenses) have also fallen off a cliff. Music players and home audio system markets are beyond dead for the average consumer.
Today smart phones are the media consumption device of choice for a growing number of consumers and between Samsung and Apple, that market is locked up tight on the high end, and Sony can't compete on the crowded middle and low end segments. Everything Sony was know for is being consumed by smart phones.
If it wasn't for the PS4 being a success, mainly due to Microsoft fumbling the XBox One and spending less on exclusive titles, Sony as a brand would be practically invisible to consumers. This generation has worked out well for them so far, but they can not count on out-maneuvering Microsoft forever. Microsoft is already fighting back on pricing and their upcoming Scorpio looks ready to trounce the PS4 Pro performance wise. If Microsoft decides to start throwing money at good exclusives again, they can claw back quite a bit of market.
Their only other bright spot they have is their camera division which is doing some really cool stuff in the mirrorless camera market. However that is mostly a niche pro market. Most consumers are perfectly happy to use their smart phone camera.
Honestly in a decade or so I can see them spinning off their consumer electronics business or outright selling it, keeping the gaming and media companies. I just can't see where they can go from here in the electronics business. Of course they still have commercial business units like their camera sensor business. I have no insight there, but again we're really looking at the consumer facing Sony here.
*They have reason to worry here too. Sony makes a number of TV shows for various networks, however due to the new realities of network TV (lower ratings, dropping viewers, and ad rate pushback from buyers) show ownership is playing a bigger and bigger part in what shows get picked up or renewed. Sony doesn't have its own network to fall back on so their only choice is to either field fewer and fewer shows, cut ludicrous first-run fee deals, or (and this is starting to happen now) give up a slice of their back end syndication and foreign rights money. Sony Television makes all their money on syndication deals, this is why you see shows like "The Rules of Engagement" stay on the air for 100 episodes despite poor ratings and odd timeslots. They practically give those final seasons to the networks to get it over the 88 or 100 episodes they need to create a syndication package.
I browse on +1 so AC's need not respond, I won't see it.
My shelves are replete with PS1 and PS2 games, a few PS3 games. All Sony needs to do to get my money is:
1) Make sure the next console can play them, and
2) Make sure that I can buy game disks that can sit on the shelves next to them that will never, ever require "the cloud" or "authorization" to run.
They're not going to do that, though, because greed has blinded them. And consequently, they're not going to get my money.
Also: Eventually, emulators will appear that can run those games on general purpose hardware. When that happens, Sony's opportunity will be over.
I've fallen off your lawn, and I can't get up.
The worst part about that list is that many of the items on it were superior in many ways to their competitor, but due to Sony's greed failed to catch on.
Sony has come up with some great products, they just need to realize that nobody wants hardware that isn't compatible with anyone else's, and none of the competitors are willing to pay the kind of royalties Sony wants, even if the end product is better.
Beyond that though, Sony did at one point in the past stand for quality. There's a reason people wanted a real Walkman and not a rip-off. The Walkman was simply a better machine. Same with many of their products. Now though the quality of Sony stuff isn't "bad", but it's also no better than any of their competitors, but they often try to charge a premium for the brand. The brand just isn't worth a premium any more.
ROOTKIT.
Haven't forgotten.
- First they ignore you, then they laugh at you, then ???, then profit.