Sony Scales Back on Smartphones

Posted on March 30, 2019 by Paul Thurrott in Android, Mobile with 11 Comments

With less than 1 percent of the market, Sony is dramatically scaling back its smartphone ambitions and could exit the business altogether.

News of Sony’s smartphone collapse comes courtesy of a Nikkei report which says that the firm is cutting up to 50 percent of the staff in its smartphone business. That business currently employs about 4,000 workers, so Sony hopes to trim it to 2,000 by March 2020.

As a last-ditch effort, Sony will focus its smartphone efforts on Europe and East Asia (read: China), and it will “limit” its efforts in Southeast Asia. Sony is already essentially absent from the United States.

But it may already be too late to fix this wreck. Sony only expects to sell 6.5 million handsets in its fiscal 2018, half the number it sold a year earlier and just one-sixth the number it sold five years ago. The firm hopes it can turn a profit by fiscal 2020 thanks to reduced expenses. But it’s running the business at a loss for now.

Of course, Sony’s been down this road before, having exited the markets for portable music and PCs in the past. And it’s dramatically cut back its TV efforts, thanks to a tsunami of cheap Chinese competition. That leaves smartphones as Sony’s only money-losing business, Nikkei says.

It’s hard not to wonder whether this fall from grace hold any lessons for current market leaders like Apple and Samsung, which are both starting to struggle. Sony never dominated in smartphones, but it was the worldwide consumer electronics leader at one point, and its designs were once widely respected and imitated. Today, increasingly, it is an also-ran.

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Comments (11)

11 responses to “Sony Scales Back on Smartphones”

  1. christian.hvid

    Sony has been winding down its smartphone business since at least 2015. Makes you wonder why they don't just take an axe to the damn thing and be done with it?

  2. SenorGravy

    Sony’s struggles have always been a head scratcher to me. You’d think their phones would have the best cameras and displays on the market. But they don’t. And then throw in some of the blandest designs in mobile. Boo.

    TBH, I’m still pissed they closed down their VAIO laptops (for all intents and purposes).

    What a loss. You coulda been a contender, SONY!!!

  3. Stooks

    Will Sony even be around to make the PS5? All the news about Sony is either "PlayStation This" or "We are closing that".

    • Greg Green

      In reply to Stooks:

      Motley fool says it's anmvoer reaction: "Even if sales are slowing, profits are coming in quite nicely, and look to be up as much as 70% over fiscal 2017 levels."

      Unless there's something bad hidden somewhere Sony seems in better shape than stocks indicate.

  4. Awhispersecho

    They really don't have much left. There's Playstation and.... Playstation. They still make damn good TV's but I'm not sure how far that can carry them anymore. Their in a tough spot. Time for a Vita 2! I know there is no chance of that happening but if Playstation is all they got, maybe now is the time to double down on handheld gaming and release a new Vita, bundle it with a 3 month trial to a couple of their services and go for broke.

  5. RobertJasiek

    On the one hand, I am happy about the decline of a company whose malware destroyed my DVD player. On the other hand, Sony has made quite a few best in category devices. If all that will be left in the market is Lenovo (another malware preinstaller), we will not have choice any more. There are by far too many stupid managements in the IT companies.

  6. Daekar

    As long as they keep making headphones... I'd hate to see them stop making those, they're right up there with Bose.

  7. Informed

    Reminds me of Sony's shuttering in 2016 of their free and highly interactive technology "museum" in New York, Sony Wonder Technology Lab, after being open for what I'd guess was close to 2 decades. I don't know of any venue in the New York metropolitan area that serves even as a remote replacement to what Sony Wonder was.

  8. Tony Barrett

    Sony are actually doing ok, and many of their divisions are making money, but the Android smartphone market is incredibly competitive. Sony make some very good handsets, but they often don't stand out from the competition, and the market only really looks to Samsung for innovations. So, my opinion is that Sony are probably doing the right thing, but they should actually now focus on the growing mid-range market where there's still money to be made. It wouldn't surprise me if LG were thinking about doing the same thing!

  9. harrymyhre

    Sony has a beautiful store in century city (near Beverly Hills) along with the apple and Microsoft stores. Rarely did I see any customers in the store.

    I can remember the glory days of Sony, so it was painful to see the brand fading. They knew how to create excellent hardware, but never got into software afaik.

  10. plettza

    What a shame. I got myself an Xperia XZ Premium in 2017 after moving from Windows Mobile 10 (my old Lumia 950XL). I actually really like the Sony. It has a camera shutter button, the display is OK. and pretty good battery life. I really like the fingerprint reader power button rather than a rear-mounted one. And even it's still getting updates; I just got a system update today in fact.

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