In the face of a massive $6.4 billion net loss in the last year, Sony is making big changes to turn the tide. Their latest press release has laid out a plan for the next year, refocusing efforts on profitable businesses and trying to turn around or streamline sinking businesses. The broad initiatives of their new strategy are as follows:
1. Strengthening core businesses (Digital Imaging, Game, Mobile)
2. Turning around the television business
3. Expanding business in emerging markets
4. Creating new businesses and accelerating innovation
5. Realigning the business portfolio and optimizing resources
The first two points are clear, showing a shift in focus from the floundering television market to the digital camera, gaming, and smartphone markets. Expanding in emerging markets is a common strategy for large technology companies such as Sony, considering the fact that Asian and South/Central American markets simply aren’t dominated by one single player.
The fourth point in part doubles down on the promise to turn around the TV business, considering the fact that Sony is planning to back 4K resolution televisions in the near future. Finally, the fifth point is the one to blame for a good percentage of the 10K layoffs planned in this transition, as products like small televisions and raw materials like chemicals that go into LCD panels can simply be more efficiently produced by a third-party.
This announcement is the first overarching strategy change since the promotion of Kazuo Hirai to CEO, which many believed to be foreshadowing for a shift in culture for Sony. Whether or not these Sony can spring back from these setbacks remains to be seen, but re-prioritizing more modern products like DSLRs and smartphones is sure to be a positive move.