Every day we’re hearing of a company running through a round of layoffs or going out of business, it’s really not a happy time. Sony is not immune to the economic troubles either. Sony is talking restructuring and that involves a potential head count reduction of 16,000 jobs due to plant closings.
This leaves Sony with some hard decisions. Restructuring can mean drastic changes that effect all their product lines. The PlayStation 3 isn’t currently a shining example of high profit margins. The console needs time to reduce its overall cost, chip sizes and bring profitability. Is it in danger?
âSonyâs not in a position to halt all domestic production but it has to do something that drastic,â said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. âIf it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.â (gamestooge)
The yen is losing value in our global economy making it more difficult to export the product and build any type of profitability plan. “A source said this month the company will likely suffer an annual operating loss of about $1.1 billion, its first such loss in 14 years” (news.yahoo.com) All this noise is making CEO Howard Stringer contemplate Sony’s involvement as a “software only” company, making us recall the changes at SEGA to this same result.
The Financial Times reported Sony will unveil details of its restructuring steps on Wednesday or Thursday. It said Chief Executive Howard Stringer was meeting with resistance from some executives to shifting the company’s focus to software from hardware and cutting jobs in Japan. (news.yahoo.com)
Is this just a case of a fearful executive trying to lay plans for a more stable future? Software is easier to develop, pays for itself quickly and becomes pure profit as it ages. Hardware requires constant upkeep at manufacturing facilities, chip reductions and a boat load of quality planning for first shipment. Would Sony go full software?
Let’s face it, Sony isn’t SEGA, they’ve been developing hardware for consumers since anyone can remember and they’ve been doing it with quality and market penetration. It seems absurd to think they’d forgo hardware designs in replacement of a full software solution to the problem. In addition, Sony has already invested a large amount of cash into seeing PS3 through it’s 10-year plan and letting that die now is realizing a huge loss on investment.
If Sony pushes through the economic and maintenance course, the PS3 will become highly profitable, much like the PS2 last generation (with a slower ramp up for sales). Even if they break even after ten years it seems a lot better than throwing all the effort away.
Perhaps Howard Stringer is talking “software” for the next generation home console? You think Sony will create a PlayStation 4?
@Street Fighter X Tekken DLC will never come to Xbox 360
I get Dan’s point, placing the DLC on the disk is like dangling a carrot in front. And yes, since the DLC is already distributed, then why not get some money out of it?
@Vivendi finding few buyers for Activision-Blizzard
Thing is, the game industry is quite tough. Spending N billions to buy a piece of it is quite a risky bet. Miss-manage it and you’re never going to recover the investment. So I can understand why nobody is rushing to buy.
As from the potential buyers point of view, Vivendi desperately needs money. Play your cards right and you can get Activision-Blizzard at a nice discount đ
@âWouldnât be surprisedâ if more aggressive PC games start to appear
Hitting a Diablo 3 home run: good luck. It’s hard to do for any platform, not just the PC.
Erm, no cycle detected on my end, always KB and mouse here.
@Grand Theft Auto V will support planes and jets, wonât have beta test
Not a fan. Loved Mafia though.
@ Question of the Week.
I was going to say ‘No’ initially, but I saw the hardware specs, so it’s a ‘maybe yes’ now. Android is hackable, it has a USB port so ….
Gearbox: âWouldnât be surprisedâ if more aggressive PC games start to appear: For the record, I got excited as soon as I heard you say that Borderlands 2 would have drag-and-drop inventory, because Borderlands’ huge number of items and weapons makes it a pain to navigate through the inventory with the consolish setup it had. Other than that, all I got that Gearbox was placing a huge bet on the PC, and telling everyone how great it will be to be a PC gamer.
@OUYA: Good for them for tons of funds, but this can also be the point where a Kickstarter goes horribly wrong. Seriously, from what I understand they pretty much said “we’re going to try these bunch of different ideas together and see if they stick”. Let’s hope they’re successful and manage to create a great platform.
@QOTW: Probably not. I barely play Android games, and I doubt any huge games will be on the system before anyone knows how successful it will be.
And yes, Gearbox are looking for headlines: http://www.ign.com/articles/2012/07/24/randy-pitchford-plagiarism-is-rife-in-the-industry