It emerged today that Sony will be undergoing some major restructuring in their business. In addition to selling off Vaio, Sony will be focusing on the smartphone and mobile business and pursuing a “…more efficient and dynamic structure…” for their TV business. The information came in the form of a detailed news release from the Sony website.
Sony also posted a Q3 net profit 257 million USD contributed to, in no small part, by the release of the PS4, which sold 4.2 million units in 2013. The Playstation department continues to rise at a steady rate of 33% each year.
The restructure of the business was originally announced in April 2012, which included an initial reduction of 10000 Sony staff members worldwide. Today’s announcement brings the news that a further 5000 will be made redundant by the end of the financial year 2014; 1500 employees in Japan and a further 3500 overseas.
Staff reduction doesn’t come cheap though as the report explains; Sony will be spending 90 billion Japanese Yen (approx. 846 million USD) over the next year-and-a-half, however they believe that it will “…result in annual fixed cost reductions of more than 100 billion yen…” (approx. 985 million USD) by the end of fiscal year 2015. Gotta spend money to make money, right?
The PC/Vaio arm of Sony is in the process of being sold to Japanese Industry Partners, with the deal expected to come to a “…definitive agreement…” in March. This isn’t just a deal to sell the Vaio name though, Sony will “…cease planning, design and development of PC products. Manufacturing and sales will also be discontinued after the Spring 2014 lineup…”. Have no fear though, Sony Vaio devotees, as they said that customers would continue to receive support; for how long though, remains to be seen. I pity those that work in dedicated Sony retail stores, as their customer-related headaches will most likely rise with Sony’s profits.
As the profitability of Sony’s TV business has been on the decline over the past few years, the department will be shifting its focus to high-end models; specifically, the 4K market, in which Sony is currently the number one in both Japan and the US. 2K won’t be left behind though, as Sony aims to bolster their range by implementing a higher number of models, equipped with the latest in Sony tech, such as their Triluminos display.
Whilst other departments may be suffering, the Playstation department seems stable, which is great news for gamers, as the last thing we need in such early days of this new generation, is problems at Sony HQ.