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Thursday, 25 May 2017 09:21

'It’s a Sony' to go upmarket

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Sony has announced it will focus its smartphone efforts on the premium mid-range and flagship arena where it can add unique Sony value. It is part of Sony group’s new strategy for survival and growth.

Sony, once a shining light of Japanese ingenuity, design style, and an aspirational brand, has experienced a torrid decade of decline.

Sony HiraiFive years ago, chief executive Kazuo Hirai, was appointed to lead this once iconic company out of the wilderness. It was plagued with losses from computers, consumer electronics, TV, components (batteries that were subject to recalls), games console market erosion, and its movie/music division was on its knees after backing some monumental flops.

Add to that the Sony pictures 2014 hack of the century and analysts had Sony on the way out. But a new Sony is emerging and its philosophy is to concentrate on products it can add unique value and as Hirai said, “We changed our strategy to go after profitability rather than focus on the size of the business." How does that relate to smartphones?

In an Xperia Blog it has announced that its “premium standard” range — read lower cost Xperia X and Xperia X Compact (both selling for under $300) — were finished. It’s even lower cost XA ultra, XA and E5 are also at end of life. Expect some amazing sales prices in June as Sony needs to clear lots of inventory.

In 2017, it has announced that its flagship range will be the XZ Premium and XZs (phablet) and its mid-range will be the XA1 and XA1 Ultra (phablet). There may be an L1 low-cost handset in some markets.

Sony product portfolio

I suspect the problem here was that Sony was putting too much technology into a smartphone that sold in a market purely driven by price. Teardown analysis revealed that it was losing money on this range. This market did not care about aspirational brands – it just had to do the job and last as long as it could. Global sales were reportedly only 43% of target, most of which came from Japan where Japanese brands are well supported.

But its woes don’t end there. The flagship X Performance and XZ, both of which are excellent handsets, globally achieved 88% of sales targets, thanks only to selling 104% of that in Japan – to the rest of the world “It’s a Sony” did not matter. The fact is that Sony managed to sell only 14.6 million units over its core models.

So, what are the technologies that only Sony can deliver and at what cost?

First, let’s be honest even if Sony succeeds it will continue to be a bit player. It appears Hirai is happy with that as long as it is a profitable bit player and most of that will come from the domestic market.

Its strengths include camera technology, but it seems to be willing to sell its CMOS sensors and lenses to anyone who will buy them. There are suggestions of a memory stacked CMOS image sensor, motion eye predictive capture system, and super slow motion video at 960 fps. But what the people want is idiot proof day and night shots and I suspect it will not get the highest DxoMark camera score ever.

It can borrow from its TV technology and make Triluminous 4K, HDR a standard screen and its movie business for 4K content. It has announced OLED TVs – why not OLED smartphone screens?

And its Qnovo adaptive charging is unique to Sony at present. In theory, this should give better battery life.

But above all, it needs to take leadership – not just make another glass slab. That leadership needs to realise that it is up against the might and budgets of Apple, Samsung, LG and recently Huawei, Motorola (Lenovo), OPPO/vivo all of which have a commanding lead. That leadership needs to spend a fortune re-establishing “It’s a Sony” as an aspirational brand.

As a long-term Sony user, I wish them luck. 

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Ray Shaw

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Ray Shaw [email protected]  has a passion for IT ever since building his first computer in 1980. He is a qualified journalist, hosted a consumer IT based radio program on ABC radio for 10 years, has developed world leading software for the events industry and is smart enough to no longer own a retail computer store!

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