Sony Looks Set To Lose $1.1 Billion In Fiscal 2008

Illustration for article titled Sony Looks Set To Lose $1.1 Billion In Fiscal 2008

Remember when Howard Stringer said that he "wasn't recession proof" at this CES keynote? Yeah, he wasn't joking. Sony is about to post its first loss in 14 years, and it's a doozy.

Japan's Nikkei and Reuters are both reporting that losses for the fiscal year ending in March could hit $1.1 billion, with Nikkei saying they may even drift closer to $2 billion. This is, as they say, the exact opposite of the $2.2 billion profit forecast Sony previously cited.

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At fault are, well, the financiapocalypse of course, which has resulted in subdued demand for HDTVs in the American market and elsewhere, as well as a booming yen that has driven up the price of exports. Stocks for all of the Japanese tech companies plunged today from the news, with Toshiba, Canon and Panasonic all down in the neighborhood of 7%.

So the idea of Sony shuttering a major division by the end of next month rings a bit more true now, doesn't it? Who will get the axe?

[NYT, Variety]

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DISCUSSION

Four years ago I said Sony has great hardware but they can't write sh*t for software. Still true. Nowadays, you can't just have great hardware. Everyone expects their gadgets to hook up to their computers and mfrs better make sure they have that software infrstructure done right. I love my Sony HD camcorder but I threw out every program disc that came in the box and use Apple's stuff.

And then, on top of this they insist on using their proprietary media. Well, are they in the business of selling electronic gadgets or storage media? How many shoppers looked into a Sony camera and ran away when they found out about memory stick? UMD anyone? MiniDisc? The least they could do is not charge an arm and a leg for the media.

Sony needs to get down on its knees and beg Steve Jobs to let Sony inside the iTunes playground. (That's assuming Jobs sees any value in letting them in in the first place.) That means either selling their non-PS3 consumer electronics division to Apple or accepting a strategic partnership with Apple as senior partner.

Because Sony's consumer electronics is in a death spiral. It's slow but it's happening because the future of consumer electronics belongs to the companies who can tie all their products up in an integrated, user friendly, media-and-device management platform. Apple has iTunes which they continue to build on, everyone else has nothing.