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?
“Sony’s not in a position to halt all domestic production but it has to do something that drastic,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. “If it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.” (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?
Hi guys.
Thanks for the episode 🙂
I have not been playing a lot, because i am more into wathcing movies and TV shows instead of gaming. But i played some Magic the Gathering Arena at least:)
Plaguetale: this looks really nice, lets see when it will come out and if i will find time for it 🙂
Minecraft Legends: i could not think of much things, which interest me less than this 😀
Sonic: i was never into all the sonic games … its too chaotic and fast for me .. dont like games like that 🙂
german language: it´s even harder if you are native speaker, to hear and feel how our language is goind down more and more. More slang and english words. Its sad that the youth does not even want to talk “real” german, they have their own language 🙁
Smart TVs: i really love all this functionality, not even the TVs. I made a lot automated in my home. I love my harmony, and i did a lot with Alexa and some routines. Sure its all just for fun, but i love it 🙂 I have a LG 4k 3d HDR Smart TV … it was freakin expensive .. but the quality is awwesome 🙂 Connected is a new Denon AVR receiver and a 5.1 Teufel Sound system 🙂
Please stay healthy and keep on with the interesting work 🙂
Greetings,
Ralf