Sony in financial trouble?

Cub · Post by **Cub** » Thu Sep 22, 2005 5:56 pm

Sony to Trim 10,000 Jobs in Restructuring

By YURI KAGEYAMA, AP Business Writer
Thu Sep 22,11:09 AM ET

TOKYO - Sony Corp (NYSE:SNE - news). said Thursday it will cut about 10,000 jobs, close 11 plants and shrink or terminate 15 unprofitable operations in an ambitious restructuring bid to revive its stumbling electronics business.

The turnaround plan, which will reduce Sony's global work force by 6 percent, comes under the fresh leadership of Chief Executive Howard Stringer, a British-American dual citizen who was named in March as the first foreign head of the Japanese electronics and entertainment company.

But prospects remain uncertain for Sony, which has lost money in its electronics sector for two straight fiscal years. On Thursday, it revised its forecast downward for the fiscal year through March 2006 to a net loss of 10 billion yen ($90 million), far worse than its initial forecast for a 10 billion yen profit, citing restructuring costs for the latest plan.

To cut costs and streamline its sprawling empire, Sony said it would downsize or quit 15 business categories and reduce the number of models by 20 percent. Sony refused to specify which businesses would be trimmed, but the company's president, Ryoji Chubachi, said research costs for its Aibo robot division will be reduced, and no new product development will be carried out in its high-end Qualia brand line

Under the plan that Stringer said will cut costs by 200 billion yen ($1.8 billion) by the end of March 2008, Sony will reduce 4,000 workers in Japan and 6,000 outside the nation, while factories would be cut from the present 65 to 54.

Tokyo-based Sony, which did not give a nation-by-nation breakdown for overseas job cuts, employs more than 151,000 workers worldwide.

Sony denied Japanese media speculation that it was selling off its financial businesses, which include banking and insurance, and did not announce any major spin-offs or sales. The company said it would review real estate, stock holdings and other assets to dispose of some 120 billion yen ($1.1 billion) in assets by March 2008.

John Yang, analyst with Standard & Poor's in Tokyo, wasn't impressed, describing Sony's cost cuts as only a continuation of a plan laid out by Stringer's predecessor, Nobuyuki Idei. Also disturbing was Sony's unchanged mentality of wanting to be an all-around king, instead of focusing on key areas, Yang said.

"If I had to give a grade to Howard Stringer, I'd give him a C-plus," Yang said. "He talks a lot about restructuring in cost reduction. He doesn't really talk about stirring growth."

Stringer acknowledged the "basic strategy" had not changed, but that the difference this time will come with faster decision-making and a more definite commitment to getting things done.

"We have made promises before but we failed to execute them," Stringer said at an afternoon news conference in Tokyo. "We must fight like the Sony warriors that we are."

Sony, known as a pioneer in electronics first with the transistor radio and later the Walkman, has seen some of its glory dimmed by Asian rivals like Samsung Electronics Co. and other lesser known companies that are offering cheaper prices.

It has had to rely on its movie division such as the popular "Spider-Man" series and its successful PlayStation video-game consoles to maintain profits in recent years.

Sony has also been criticized as falling behind in slimmer TV models, such as liquid-crystal and plasma display sets, that are increasing popular around the world, losing market share to relative Japanese newcomer Sharp Corp. as well as old-time rival Matsu ****a Electric Industrial Co., which makes Panasonic brand goods.

Sony also fell behind Apple Computer Inc.'s iPod in what should have been its forte Ã¢â‚¬â€ portable music players Ã¢â‚¬â€ clinging to CD and minidisc formats and its own proprietary but unpopular format for digital music files. The iPod models are proving a big hit in Japan, where Apple began its iTunes store in August to rave reviews.

Over the last five years, Sony shares have lost two-thirds of their value, and are trading at about 4,000 yen ($36).

Chubachi, also head of the electronics division, conceded that his company wasn't making products that people wanted to buy and that Sony's technological prowess had declined.

Sony said it would focus now on so-called "champion products" including the PlayStation 3 next-generation game console, Bravia liquid crystal display televisions and the Walkmans.

Chubachi tried to reassure the crowd that Sony was making headway in winning consumers with new products such as the newly available Bravia flat-panel TVs codeveloped with Samsung.

"We are definitely feeling that the recovery is under way," he said.

http://news.yahoo.com/s/ap/20050922/ap_ ... japan_sony

Post by **Popcorn** » Fri Sep 23, 2005 3:26 am

I think I read somewhere that the PlayStation is responsible for like 60% of Sony's profits. I don't think they're suddenly going to go software only or anything.

Post by **Esrever** » Fri Sep 23, 2005 12:03 pm

It's amazing that the company is now using the massive profits from the Playstation to counterbalance the poor performance of the rest of the company. I can remember a time not too long ago when the complete reverse of that was true!

Zaranth · Post by **Zaranth** » Fri Sep 23, 2005 3:04 pm

"We must fight like the Sony warriors that we are."

right......................maybe "Corporate Sony Warriors" can be one of the next games they put for a game system :P

and not to offend anyone who likes Playstation and it's descendents/other Sony products, but...
ha ha ha! yes! it is time those dudes at Sony learned humility! aha ha ha!

(bit of an exaggeration, but c'mon. sony and it's playstation are not all powerful. at least not at the moment).

Post by **Segaholic2** » Fri Sep 23, 2005 3:07 pm

Zaranth wrote:and not to offend anyone who likes Playstation and it's descendents/other Sony products, but...
ha ha ha! yes! it is time those dudes at Sony learned humility! aha ha ha!

(bit of an exaggeration, but c'mon. sony and it's playstation are not all powerful. at least not at the moment).

Actually, the PlayStation2 is the one that's sold over 80 million units worldwide. So I guess they're laughing at you.

EDIT: <A HREF="http://www.scei.co.jp/corporate/release ... 3e.pdf">90 million.</A> Sorry.

PSMad · Post by **PSMad** » Fri Sep 23, 2005 4:05 pm

While I like my PS2 I wouldn't care if Sony died... I'd just play MGS6 on my new X-Box.

Sony's cocky attitude as of late has left a bitter taste in my mouth so I'm with Zaranth. maybe now they'll shut their mouth and get on with what they are good at.

Brazillian Cara · Post by **Brazillian Cara** » Fri Sep 23, 2005 4:32 pm

If I heard this 3 years ago, I would have bought fireworks.

LOUD-TREE · Post by **LOUD-TREE** » Fri Sep 23, 2005 10:39 pm

OH GOD, YES!! This is SO good, it just HAS to be fattening!

Can't wait for Nintendo to hand Sony's ass to 'em. Those bastards.

plasticwingsband · Post by **plasticwingsband** » Fri Sep 23, 2005 11:02 pm

Yeah, fuck Sony for having good business sense. Nintendo's not at fault for their current position at all; the DS and Revolution are "innovative" and anyone who can't appreciate "innovation" is obviously a moron.

srcsm

I've just realized what Nintendo means when they say "innovation". It's code for "No 3rd-Party Support"!

CM August · Post by **CM August** » Fri Sep 23, 2005 11:22 pm

I was thinking along the lines of "shitty gimmick".

LOUD-TREE · Post by **LOUD-TREE** » Fri Sep 23, 2005 11:36 pm

Why do people confuse gimmick with innovation? Sony is nothing BUT gimmicks. They have to pack their systems full of DVD players, burners, CD players, Tivo and a toaster to even so much as compete.

Nintendo brings nothing but innovation and the standard gaming machine; not the multimedia piece o' crap.

Both Sony and Microsoft lose money for every system they sell, because they over produce their shit. And yet, Nintendo is the only company out of the three to make ANY money: http://www.cubed3.com/news/4145

Sony has an aweful business sense, and if there is a just and willing god, Sony will drop out of the console race before PS5 hits.

plasticwingsband · Post by **plasticwingsband** » Fri Sep 23, 2005 11:47 pm

LOUD-TREE wrote:Why do people confuse gimmick with innovation? Sony is nothing BUT gimmicks. They have to pack their systems full of DVD players, burners, CD players, Tivo and a toaster to even so much as compete.

Nintendo brings nothing but innovation and the standard gaming machine; not the multimedia piece o' crap.

Both Sony and Microsoft lose money for every system they sell, because they over produce their shit. And yet, Nintendo is the only company out of the three to make ANY money: http://www.cubed3.com/news/4145

Sony has an aweful business sense, and if there is a just and willing god, Sony will drop out of the console race before PS5 hits.

Did Sony and Microsoft like, run over your dog, or something? I mean, what the hell?

They are all just businesses. Besides, we all know that Jesus loves the PSP so I don't think that God is gonna help bring Sony down any time soon since he likes to keep Jesus in a good mood.

Post by **Esrever** » Sat Sep 24, 2005 12:24 am

Nintendo is the most profitable company of the three, but Sony most certainly does not lose money in the video game arena. In fact, like it says in the article above: Playstation software and accessory sales are one of the few things Sony does make money off of. At the moment, Microsoft is the only one of the big three losing cash in the console world, and that's because they've conciously adopted a short-term deficit strategy in the hopes that it will secure them a larger, more profitable market share in the future.

I would think that Sony has had almost nothing but good business sense since they entered the console market. That's why they've managed to get into the position they are in now, even though they entered as the underdog and even though their console is the most technically inferior of the current crop. Lord knows I don't have any personal attachment to Sony or their shoddy-ass hardware, but I have to admit they certainly know how to make money with it.

chriscaffee · Post by **chriscaffee** » Sat Sep 24, 2005 12:58 am

LOUD-TREE wrote:Why do people confuse gimmick with innovation? Sony is nothing BUT gimmicks. They have to pack their systems full of DVD players, burners, CD players, Tivo and a toaster to even so much as compete.

Nintendo brings nothing but innovation and the standard gaming machine; not the multimedia piece o' crap.

Both Sony and Microsoft lose money for every system they sell, because they over produce their shit. And yet, Nintendo is the only company out of the three to make ANY money: http://www.cubed3.com/news/4145

Sony has an aweful business sense, and if there is a just and willing god, Sony will drop out of the console race before PS5 hits.

That website is a load of crap. Everyone knows that companies lose money selling boxes and make it up with royalties on software. It's good business sense because you can attract customers with a low price and still make money.

LOUD-TREE · Post by **LOUD-TREE** » Sat Sep 24, 2005 1:00 am

plasticwingsband wrote:
LOUD-TREE wrote:Why do people confuse gimmick with innovation? Sony is nothing BUT gimmicks. They have to pack their systems full of DVD players, burners, CD players, Tivo and a toaster to even so much as compete.

Nintendo brings nothing but innovation and the standard gaming machine; not the multimedia piece o' crap.

Both Sony and Microsoft lose money for every system they sell, because they over produce their shit. And yet, Nintendo is the only company out of the three to make ANY money: http://www.cubed3.com/news/4145

Sony has an aweful business sense, and if there is a just and willing god, Sony will drop out of the console race before PS5 hits.
Did Sony and Microsoft like, run over your dog, or something? I mean, what the hell?

They are all just businesses. Besides, we all know that Jesus loves the PSP so I don't think that God is gonna help bring Sony down any time soon since he likes to keep Jesus in a good mood.

Microsoft I dont have much of a problem with as I do Sony. For one, I fucking HATE Ken K, the fucking liar. Two, sony does make the most bullshit consoles out of the three, and people, which I will NEVER FUCKING UNDERSTAND WHY, still buy them.

The PSP, to me, is worth as much as a sack of shit. I wouldn't even accept a FREE PSP. When it first launched in japan, it had a great number of defects such as dead pixles, broken sqaure button, busted right button, UMD projectiles, and so on. Did Sony do anything about it? anything at all to replace the defective products? Nope, not a damn thing.

Ken Kutaragi even went on to so much as say this to the consumer:

Ã¢â‚¬Å“This is the design that we came up with. There may be people that complain about its usability, but that's something, which users and game software developers will have to adapt to. The button's location is [architectured] on purpose," Kutaragi added. "It's according to specifications. This is something that we've created, and this is our specification. There was a clear purpose to it, and it wasn't a mistake."

"I believe we made the most beautiful thing in the world. Nobody would criticize a renowned architect's blueprint that the position of a gate is wrong. It's the same as that."

A big fat fuck you to every, pretty much. Also, might I add that anyone who is willing to buy a UMD over a DVD is FUCKING RETARDED. Why the hell wouldn't you just get a normal portable DVD player? The way I see it, good ones are on sale for about a hundred bucks, which is about, oh, I dunno, $150.00 cheaper? Cause look at it this way: THERE ARE MORE MOVIES FOR THE PSP THEN THERE ARE GAMES. It sickens me when people feel they absolutely have to rebuy their entire DVD library on UMD. Lets not forget the battery life of three hours, which'll only get you half way through ultra mega-fuck edition of The Return of the King.

God, I honestly think sony defects their consoles, so that when little billy can't play is launch date PS2 anymore because it can't read new disks, mommy has to go out and buy a brand new one. Money in the bank.

plasticwingsband · Post by **plasticwingsband** » Sat Sep 24, 2005 1:12 am

LOUD-TREE wrote:God, I honestly think sony defects their consoles, so that when little billy can't play is launch date PS2 anymore because it can't read new disks, mommy has to go out and buy a brand new one. Money in the bank.

Sorta like how Nintendo re-releases the GameBoy whenever they need some more "money in the bank," right?

Post by **Esrever** » Sat Sep 24, 2005 1:21 am

LOUD-TREE wrote:...and people, which I will NEVER FUCKING UNDERSTAND WHY, still buy them.

I think this says more about your own business sense than it does Sony's. You might not see the point in UMDS (and frankly, neither do I) but they're selling spectacularly so obviously there is some kind of demand for them. You can't really fault a company for becoming successful with stupid products. If these things sell, then I suppose the buyers are stupid too, and stupid buyers require -- nay, demand -- stupid products. Time and time again, Sony has given the people what they want, which is apparently shoddily-built game systems that looks pretty and play movies.

Double-S- · Post by **Double-S-** » Sat Sep 24, 2005 2:43 am

PSP is becoming a movie player first, and a handheld system second. Just on account of sales. And the fact that there are only 2 interesting games on it (Lumines and Virtua Tennis).

I'd take a PSP for free. Eh, I'd take mostly anything that didn't hurt me for free.

Post by **Segaholic2** » Sat Sep 24, 2005 1:21 pm

LOUD-TREE, you're an astounding moron. You're going to call Sony's choice to put a DVD player in the PS2 a gimmick (a move that arguably won them the majority market share they have today), while calling everything Nintendo's ever done an innovation? Need I remind you of the Virtual Boy, carts over CDs on the N64, the N64's absolutely retarded "innovative" controller design, the GameBoy and its five hundred iterations, the fact that they port and re-release every first-party game they've ever had to the GBA, the fact that half of the Revolution's appeal is that it can play Nintendo's old games (and the other half is what a lot of people could honestly call a "shitty gimmick"), how there are currently FIVE (count them, five) different devices that all play GBA games on the market right now, and how they whore out Mario more than Sonic and Megaman combined? Wow, that's innovation.

chriscaffee · Post by **chriscaffee** » Sat Sep 24, 2005 1:30 pm

Sega, did you ever consider how wrong you could be? Let's be reasonable. Sony is a newcomer to gaming. Why did they jump into gaming at all? Because they wanted more money. Why did Microsoft? Because they wanted more money. Now Nintendo has been into gaming for a while. They have EXPERIENCE. They make games because the want to make people HAPPY. I mean let's be honest, if Nintendo was in it purely for money wouldn't they make better desicions. It's OBVIOUS that SEGA and Nintendo were in it for the FANS. How else can you explain the horrific FAILURES that they have become? Simple. They put GAMES above BUSINESS unlike greedy SONY and MICROSOFT.

Neo Yi · Post by **Neo Yi** » Sat Sep 24, 2005 1:33 pm

All I know is without wanting to get into an argument is that Sony's consoles are still selling like hot cakes, so even if we ridiculate them, they're still probably laughing down at us cuz' they got lots of money and we don't.

I don't have anything against Nintendo either. Yea, they've made their blunders and all other craps in their past, but considering they're still in the business despite all that is impressive nonetheless, especially with gaming becoming more "mainstream" and Nintendo still putting up with their "kiddy-image". Although are they still doing that for the Revolution or what?
Plus...I really can't hate Nintendo, I really can't.
~Neo

Post by **Crazy Penguin** » Sat Sep 24, 2005 1:37 pm

Ten thousand people have lost their jobs. That's nothing to ridiculate.

Gaz · Post by **Gaz** » Sat Sep 24, 2005 2:32 pm

plasticwingsband wrote:Besides, we all know that Jesus loves the PSP so I don't think that God is gonna help bring Sony down any time soon since he likes to keep Jesus in a good mood.

I thought the PSP was sent by God to find a chosen one who could command an army to defend Heaven from an invasion from Hell.

Oh wait, that was a South Park episode!

Baba O'Reily · Post by **Baba O'Reily** » Sat Sep 24, 2005 3:23 pm

CAPITALIZE all of the LETTERS of certain words for MORE EMPHASIS. Specifically, the names of COMPANIES and the subject of your SENTENCE are good starting points, as well as any POINTS you may be ARGUING.

LOUD-TREE · Post by **LOUD-TREE** » Sat Sep 24, 2005 4:02 pm

plasticwingsband wrote:
LOUD-TREE wrote:God, I honestly think sony defects their consoles, so that when little billy can't play is launch date PS2 anymore because it can't read new disks, mommy has to go out and buy a brand new one. Money in the bank.
Sorta like how Nintendo re-releases the GameBoy whenever they need some more "money in the bank," right?

Nothing like that at all. You dont HAVE to rebuy a GBA SP or a GBM if you already own a GBA, because they wont BREAK ON PURPOSE TO MAKE A QUICK BUCK!