Why sony failed to offer an ipod-like product

Electronics giant Sony vows improvement – and leaves everything the same

Better late than never, Sony board member Ken Kutaragi must have thought when he told the Japanese Foreign Correspondents Club in Tokyo that Sony had been pursuing the wrong business policy for years.

"Because we are involved in the music business, Sony was very reluctant to offer an iPod-like product, but we have learned our lesson," said Kutaragi, head of Sony Computer Entertainment, the Sony subsidiary that developed the Play Station line and made it one of the few remaining cash cows for the Japanese.

Only a few hours later, Sony ied a profit warning, not about profits, as even the Germans burned by the Neuer Markt know by now, but that profits will drop dramatically. By a whopping 31 percent, from a planned 1.19 billion euros (160 billion yen) to 821 million euros (110 billion yen) for the fiscal year ending March 31. March. The reasons: a bad Christmas, in which not only fewer DVD players, TV sets and video cameras were sold than Sony had hoped, but also at sharply lower prices. Japanese Christmas shoppers who bought flat-screen TVs got DVD players for free from the dealers, the Financial Times reports.

It’s interesting to note, however, that Sony is not using this price drop as an excuse, but rather, under the prere of dwindling profits, is admitting for the first time that it has made fundamental mistakes in its business policy. However, Kutaragi, who is sometimes considered to be the successor to Sony CEO Nobuyuki Idei because of his success with the Play Station, is only confirming what has long been obvious to all fans of consumer electronics.

For the company, which had built a legendary reputation and worldwide success with inventions such as the Walkman, the Beta video system and the Trinitron picture tube, had recently attracted attention mainly for products that were characterized by the fact that they simply ignored the wishes of customers. The reason: the battle between Sony’s various divisions for supremacy in the company, as Wired analyzed in detail back in February 2002. Because Sony is the only one among the electronics giants that also owns a significant amount of intellectual property "Content" intellectual property: Music, films, computer games – with Sony Music, Sony Pictures and Sony Computer Entertainment.

These content providers fear nothing so much as the rip, mix and burn of the p2p generation, which happily sells music and movies on file-sharing networks, plumbs around on its computer game consoles until it can use them to control the microwave oven, and generally shows no respect for the so-called "digital world" "intellectual property" lacks.

Sony’s response: MD players that could be played at breakneck speed via the USB port, but from which nothing could get out via the same port (could be used to copy music without permission), the Attrac format for music that completely disregarded the fact that the rest of the world used MP3, and a music download portal that was so user-friendly that the Washington Post called it a "music download portal" "Embarrassment" called.

In all this, however, the management was so self-confident that it rejected Apple’s offer of cooperation and has so far not commented on a similar proposal from Microsoft.

The question remains whether Kutaragi’s harsh criticism will have consequences. A day before answering the Correspondents’ Club, he had announced that he would open up the Universal Media Disc (UMD) format for Sony’s latest hit, the Play Station Portable, to other vendors. But only for music and movies, which are then delivered by the rough studios. Customers can’t record anything on the discs themselves. And even the game format for the console, according to Kutaragi, Sony will not reveal. "It’s just getting started," he told reporters in Tokyo, referring to the mistakes of the past, "we are growing up." However, one can be divided on this.

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