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Sony Attempts to Chart New Course

Morningstar: Addressing serious issues at Sony SNE has been like altering the course of a supertanker with an undersize rudder. However, recent changes are beginning to create some positive momentum for the firm. First, the company announced that Bert Nordberg will take over the president role at the Sony Ericsson joint venture and that Sony CEO Howard Stringer will become chairman of the board of Sony Ericsson. Innovation has been lacking in recent years, as Sony Ericsson's product line has failed to keep pace with fully featured smartphones from competitors like Apple AAPL . We are pleased to see new leadership step in, bringing stronger ties to Sony and hopefully providing a much-needed boost to phone design.

The second development from Sony was the long-overdue reduction in price of the PlayStation 3 to $299 from $399. The console remains more expensive than key rivals, with Microsoft's MSFT Xbox at $199 and Nintendo's Wii at $249. However, reducing the premium between the consoles should be a key driver of sales leading into the critical holiday season. Ultimately, we believe success in the console war is driven by exclusive games, but having a reasonably priced platform is essential just to have a chance. PS3 sales are down 32% year over year, so the rest of 2009 will be a critical test of Sony's pricing strategy.

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chaosatom3561d ago (Edited 3561d ago )

It's good to see articles that recognize the effort that Sony is putting in their business.

Chris3993561d ago

It wasn't filled with either praise or scorn and was a relatively detached, arbitrary look at Sony and their business portfolio.

Much better than: "It still haz no PS2 BC = FAIL", and the like that we've seen around here the past few days.

This was a refreshing read.

sunil3561d ago

Article says its more expensive than the 360 (comparing the arcade) = bull

RememberThe3573561d ago

A real article... It's like a breath of fresh air.

"The challenges facing Sony remain severe, and it has taken one the firm's darkest hours to create an atmosphere where change is possible to achieve politically."

That is how change occurs on nearly every level of life. You change when you need to - they needed to.

mastiffchild3561d ago

Well yes and no. Necessity is indeed the mother of invention and would bear out what you say almost perfectly with Sony re"inventing" themselves after a decade of growing corporately flabby. The changes were in Sony's case entirely driven by the dark days of the past two years.

However, as is the Japanese way in these things we see little panic and an emphasis on evolution over revolution and little risk of the drastic kneejerk cuts that have sunk many a troubled western company in similar straights.

Anyway, while you're pretty much on the money for how Sony have been forced to change it's surely better, though as it's less spectacular you notice it less and it garners fewer reports if you pre-empt the changes as , say Bowie did with his personality progression in the 70's to reinvent himself BEFORE sales began to pall. This is also a business model in the art world used by the likes of Madonna to this day whereas Britney would encapsulate EXACTLY what you suggest 357, no?

All I guess I'm saying is it's better if you can manage the change without the necessity arriving and fully landing on your plate! The end result is the same change but with much less pain and I suppose drastic change is more often brought on by hard times and Sony's relative restraint in their restructuring could be prudent even if it is only a result of their Japanese heritage.

cmrbe3561d ago

so it will take a while for things to get better.

SCEI on the other hand i believe will do very well for Sony. The fact that they brought manufacturing cost down by 70% and are proably making a profit from the PS3 HW now is a really good boost for them.

I agree with them completely. Success will always be driven by exclusives first and foremost because in the end people buy console for the software and exclusives software is what really gives you the edge in this console bussiness however the HW must be affordable for people first to buy in order to buy the SW and this new 299 price point is that affordable price.

Its s two step process. Even if you have an affordable HW if you don't have the software and more importantly exclsuive ones there is little or no point for consumers to by said console. This is why MS is trying really hard to pint multi-plats as exclsuives because they know they will always be behind Sony when it comes to exclusives.