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Sony Facing Corporate Upheaval?

According to the UK's TimesOnline, Sony company sources have said to expect a series of "sacred cow-slaying" procedures that will be radical enough to "abolish or fundamentally alter many of Sony's long-established business practices."

This restructuring is expected to be announced after the Consumer Electronics Show in Las Vegas, and not a moment too soon as far as most analysts and investors are concerned. The majority of these major changes will be "imposed on Sony's domestic Japanese operations in the form of factory closures and the abolition of several major divisions," and investors have asked president Sir Howard Stringer to really take charge. A Credit Suisse analyst, Koya Tabata, recently said that the focus of the company's research and development must be on software, and the important thing is to "improve organizational strength in the areas of development [and] purchasing and marketing." Evidently, a lot of the problem centers on an internal clash between the Japanese branch of Sony and its U.S. and European divisions, perhaps fueled by their non-Japanese president in Stringer. Sometimes, massively large companies like Sony really need to get back on the same page, and if that means laying waste to certain aspects of your business, than so be it.

Sony, on the other hand, has denied that any such drastic changes will be taking place. They told Reuters they have "no such plans," so perhaps all of this is just more so-called journalistic hearsay. But either way, they do need to resolve a few things and it'll be interesting to see what happens. By the way, in case you're wondering: no, the PS3 and PSP isn't going to be canceled; they're not shutting down PlayStation. That's the kind of bizarre, illogical reaction you might see online, but people with brains won't really pay any attention.

1/5/2009 Ben Dutka

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Comments (45 posts)

Buckeyestar
Monday, January 05, 2009 @ 11:04:31 AM
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This is the sort of story that leads the Xbots to claim that Sony will pull the plug on the PS3.

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WaR_HaWk
Monday, January 05, 2009 @ 11:20:41 AM
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they need to close Walkman division imo, cuz iPod owns the market!!!

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ZubraZap
Monday, January 05, 2009 @ 11:22:29 AM
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oh, the woes (and cost) of a electronics mega-corp...

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xtreme
Monday, January 05, 2009 @ 11:26:58 AM
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"they need to close Walkman division imo, cuz iPod owns the market!!! "

I semi-disagree, walkmans that are built into the sony erricson mobiles should stay 100% but any standalone walkmans players should go. Apple firmly has that market now.

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Phoelix
Monday, January 05, 2009 @ 11:31:53 AM

Yeah, I have one of those phones. It's nice.

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Troy Powers
Monday, January 05, 2009 @ 2:47:54 PM

That would have been like Microsoft saying, "Oh, we won't release the Xbox. Playstation 2 has the market wrapped up."

That's crazy. Just make better walkmen (walkmans?). I personally can't stand iPods because they're so proprietary. I've had 3 different mp3 players: 2 Cowons, 1 Iriver, and they've all been much better than any of the iPods.

Just make a better product.

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robinhood2010
Tuesday, January 06, 2009 @ 4:49:17 PM

i had a sony mp3 player, and cd player before that, as they both used the atrac compression system. i have a 20gb sony hdd mp3 player, and i still havnt used up a quarter of the space, considering i have put maybe 400 cds on there.

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ec0li
Monday, January 05, 2009 @ 11:53:46 AM
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I think I read something about Msft doing their own cuts. What can you do? It's a bad economy for everyone.

You know what...forget what I said. Nintendo is actually laughing all the way to the bank.

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MetalHead09
Monday, January 05, 2009 @ 2:37:11 PM

lol no kidding.

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Phoelix
Monday, January 05, 2009 @ 12:08:37 PM
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This is the corporate change where Sony decides to change their PS3 strategy: cut the price and start paying for exclusive games.

I hope.

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VinTheDean
Monday, January 05, 2009 @ 12:30:04 PM

You might have something here. It's the only way it's going to gain lots of ground very qickly.


Or they could realease the PS4 and the offer an official trade in value for like Half of or something like that.

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ec0li
Monday, January 05, 2009 @ 12:47:46 PM

@VinTheDean

Can you let me have some of what you're smoking? I don't wanna sound like an ass but damn, where the hell did you come up with a solution like that? You were just kidding right? Ofcourse you were. You're just effin around and purposely having fun with your crazy-talk. At least I hope you were.

Last edited by ec0li on 1/5/2009 12:48:45 PM

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kreate
Monday, January 05, 2009 @ 1:22:42 PM

hilarious =)

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Deleted User
Monday, January 05, 2009 @ 2:46:15 PM

So copy Microsoft? Im seeing this more and more..

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Phoelix
Monday, January 05, 2009 @ 2:56:58 PM

Microsoft makes business decisions that are focused on making a profit and selling their console. That's a good strategy, but, in doing so, they've released a console that won't last (it breaks AND it'll be outdated soon enough).

Sony has it the other way around. They've kept their focus on a quality product (blu-ray, the cell, etc.), but they've sacrificed some sell-ability because consumers either a) don't know about the PS3 or b) don't have enough money for one.

If Sony gets the best of both worlds by aggressively marketing a superior product, they won't be copying Microsoft; they'll be beating them at their own game.

Last edited by Phoelix on 1/5/2009 2:58:13 PM

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Advent Child
Monday, January 05, 2009 @ 10:57:04 PM

You know if Sony does start paying for exclusives I will be pretty disappointed in them. I don't agree with that for Microsoft and I could never condone it for Sony.

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www
Monday, January 05, 2009 @ 12:14:26 PM
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What?

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ec0li
Monday, January 05, 2009 @ 12:42:48 PM

que?

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Troy Powers
Monday, January 05, 2009 @ 2:48:47 PM

Was?

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Jed
Monday, January 05, 2009 @ 4:15:42 PM

Quoi?

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Nynja
Monday, January 05, 2009 @ 12:56:28 PM
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IF, and I stress IF, any of the rumors of Sony closing divisions are true the first to go:

- Palm PDA/OS
- Sony Batteries
- memory sticks
- Stand-alone DVD players
- Stand-alone Bluray players
- Desktop/Laptops (?)

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Jed
Monday, January 05, 2009 @ 4:16:14 PM

Memory sticks? no

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ceedot
Monday, January 05, 2009 @ 7:47:58 PM

I doubt all of that, except maybe the phones. Sony has a firm grip on all of those products except for the phones.

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Soral
Monday, January 05, 2009 @ 11:20:26 PM

Edit: Man, I typed so much. @@

Even though I think it is kind of ridiculous to think that major department in the company should close(Unless it obviously is a big lose and doesn't even cover the average variable costs.) Here is a respond to that:

- Palm PDA/OS: They aren't that popular to even give enough info. about it, so if anything would go, it would be this.

- Sony Batteries: No. Sony is a very major maker in this area. Many Laptop makers(Apple, Dell, HP, and Toshiba, mainly) use Sony's batteries.

- memory sticks: No. It lets them avoid having to license SD(or any other type) from other major competitions in this area, which means saving hundred of millions annually. (Example: Samsung was trying to buy San Disk because it will make them save so much money from doing so.)

- Stand-alone DVD players: Doesn't seem as a major big deal here, especially that every PS2 and PS3 that gets sold is a DVD player at the same time. (Although, that would also mean that they are better off without the Stand-alone DVD players.)

- Stand-alone Bluray players: No, they became cheaper than the current PS3 price tag now, and not everyone wants to buy a PS3 to play Blu-ray movies.

- Desktop/Laptops (?): No on laptops. Their Vaio division is making good profits and is a major designer for a lot of their products. As for Desktops, I'd say the same about them as the PDA's.

@ceedot: Sony Ericsson just became the third largest mobile phone manufacturer in the world, right after Nokia and Samsung, so..no. Not sure about the 4th quarter of 2008 though, since that happened in the 3rd quarter.

Last edited by Soral on 1/5/2009 11:21:07 PM

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noshownogo
Monday, January 05, 2009 @ 1:18:32 PM
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Desktop/Laptops division seems plausible as they are significantly more costly than their competitors while not providing anything unique for the difference in price.

How about dropping:

Cameras
Laptops/Desktops
Cell phone partnership with Ericsson

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caliblue15
Monday, January 05, 2009 @ 2:15:20 PM

They would never drop their camera line. It is WAY too good.

The would delete the following:
Walkman
Laptops/Desktops
DVD Players
but everything else is way too entwined.

Though they could scale back their TV's, and other parts.

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CH1N00K
Monday, January 05, 2009 @ 2:18:58 PM

They can't drop the Camera line. They're in Third place against Canon and Nikon. Sure it's not first place but it's not bad enough to justify dropping it. That and their D-SLR Alpha cameras are pretty sweet. They'd be idiots to get rid of it.

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HUSO
Monday, January 05, 2009 @ 6:28:24 PM

actually i believe they should drop the D-slr line up. the casual cameras are decent enuf, but for the price we pay, the Sony DSLRs just aren't good enuf. sure they got loads of techno stuff and features like all their other electronic stuff, but i've had the Sony A-350 and it just didn't give me the quality i was looking for. moving on to canon now :D

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MetalHead09
Monday, January 05, 2009 @ 2:39:57 PM
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sony can do whatever they need to do to stay on top as long as my video games dont suffer they have my support.

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WorldEndsWithMe
Monday, January 05, 2009 @ 2:41:17 PM
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How about dropping the advertising division, they don't do anything anyway.

Last edited by WorldEndsWithMe on 1/5/2009 2:42:17 PM

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Deleted User
Monday, January 05, 2009 @ 2:46:29 PM

lol

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Zaben
Monday, January 05, 2009 @ 3:10:43 PM

Beat me to it.

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karneli lll
Monday, January 05, 2009 @ 5:38:27 PM

Ben,maybe if you sent an e-mail to Sony or write an article concerning their awful marketing perhaps someone at Sony will see it and do something about it. At this point,putting chimps in Sony's advertising offices would be an upgrade.

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HUSO
Monday, January 05, 2009 @ 6:31:43 PM

if they can't do the job themselves, they should atleast outsource advertising to a third party

Last edited by HUSO on 1/5/2009 6:32:49 PM

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ps92117
Monday, January 05, 2009 @ 8:24:12 PM

i thought it was called marketing division , n adver division is in charge of ad design ,so far i love all there ads especially the old rubics one. but i dont know much bout business so u might b (->)

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QuasarSquirrel
Monday, January 05, 2009 @ 8:50:40 PM

Whatever World, its a movie downloading machine, duh. At least that's the one ad I keep seeing on TV.

Last edited by QuasarSquirrel on 1/5/2009 8:51:51 PM

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Troy Powers
Monday, January 05, 2009 @ 4:01:03 PM
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This could be bad. And just when we've got the 360 on the ropes. Unfortunately, shareholders don't see it that way.

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Phoelix
Monday, January 05, 2009 @ 4:15:46 PM

Shareholders are probably reading all of the "PS3 is a sinking ship" nonsense.

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HUSO
Monday, January 05, 2009 @ 6:35:22 PM
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most probably they are just gonna shuffle some of their staff internally. no biggie. aren't they already done with the lay-offs

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FLYING_APE
Monday, January 05, 2009 @ 7:35:49 PM
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who keeps thumbing down the xbox guy lol.

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Deleted User
Monday, January 05, 2009 @ 9:06:48 PM
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I find it funny that so many people have this "Oh they should close down ______" and another person says "No way, not _______ definitely _________" when I wonder if any of them know what they are talking about.

I'll not pretend to have wisdom I don't. Will just have to wait and see what happens.

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blitz30952
Monday, January 05, 2009 @ 10:34:14 PM
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"people with brains".. theres a general shortage of those around the internet these days....

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Qubex
Monday, January 05, 2009 @ 11:19:38 PM
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I will say this pure and simply; if the PS3 console goes under I will never get another console again; and just move to a PC and that will be that! I doubt Sony will pull the plug on the PS3... its an impossibility...

Q!

"i aM hOMe"

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Wage SLAVES
Monday, January 05, 2009 @ 11:30:37 PM
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It is a monster that has so many heads, arms and languages. Of course they would need to reconfigure to be more efficient. Stuff the xbots love I guess.

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Deleted User
Thursday, January 08, 2009 @ 3:24:15 AM
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Sony will not shut down PS3, or ther gems side - they will, however, probably need to close some devs, and cancel some games that are not delivering what they should.

This will hurt Sony's ability to price cut the PS3, since current data points that they are still losing money on each ps3 sold. If that is true, and games are not selling near as well as sony thinks or needs them to, Sony is in a bad place - games are selling better on the 360 due to market share, and percieved advantages, while ont he PS3, games are selling much worst (looking at teh attach rates shows that).

In the end, Sony will have to pump more ps3's into the market, and the only way to get demand going stronger, after that awful november, might be lowering the price drasticlly. They might need to start cutting out even more functions form the ps3 - remove the wifi, remove card reasers (if they are still there) and so on.

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