Sep 17 AT 10:44 AM Nick Gray 5 Comments

Sony’s smartphone future turns dark as projected profits plummet

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Over the past few years, Sony has made huge strides in the smartphone segment, snatching up vital market share from its competitors. Its Xperia Z line is highly regarded, but Sony has struggled to make a profit.

Sony has released a revision of consolidated forecast which calls for a 180 billion yen ($1.7 billion) in consolidated operating income loss for the year. The company will also be shifting gears for its Mobile Communications division from a “significant sales growth” strategy to focus on reducing volatility and stabilizing profits. Sony mentions that the new strategy will have an impact on its handset lineup by “reducing the number of models in its mid-range lineup” and “concentrating on its premium lineup.”

Sony isn’t hanging up its hat quite yet, but it’s clear that the company is taking a hard look at its Mobile Communications division to find a way back to profitability, which is a growing trend for companies that build smartphones. We’re hoping that Sony’s rapid iteration and refinement of its flagship devices will not slow down due to the new strategy.

The previous MRP was focused principally on achieving significant sales growth. The new MRP was modified to address the significant change in the market and competitive environment of the mobile business. Under the new MRP, the overarching strategy for the MC segment has been revised to reduce risk and volatility, and to deliver more stable profits. This revision includes changing the strategy of the MC segment in certain geographical areas, concentrating on its premium lineup, and reducing the number of models in its mid-range lineup.SONY

What do you think needs to happen for struggling companies like Sony and HTC and turn things around?

Via: Engadget

Source: Sony

Nick is a tech enthusiast who has a soft spot for HTC and its devices. He started HTCsource.com (the first HTC blog) back in 2007 and later joined the Android and Me family in the summer of 2010.

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  • BlazeHN

    They have to quit low-mid range fight, Moto G reigns there so no point on losing sales on that segment. Focus on the premium ones, Z1, Z2, Z3 are too damn good and usually with higher specs than the current Galaxy S, HTC M, etc. New unique features like PS4 compatibility are very strong selling points that can make a current user switch from their mainstream brand to Sony.

    • nosense

      Wrong.

      All manufacturers profits are plummeting, they need to assess the low-mid range for good.

      That’s where the gross market is.

      They will have to ask Mediatek for a good price and taking the hammer to produce better offers that what Chinese manufacturers are offering, Motorola included.

      ;-)

  • Dr. Leitch

    I think consolidation of companies and consolidation of their offerings will happen. A company like Lenovo will ‘roll up’ competitors and be more viable. I think HTC is a gem ready for picking.

  • Bradley

    1. No more exclusives

    2. Focus on 4 models only
    a. High End 5-6 inch with Sony attributes
    b. High End 4.3-4.7 inch with Sony attributes
    c. Mid End 4.7-5.5 inch with cheaper components but good camera or other single gimick
    d. Cheap End 4.0-4.7 with cheaper components but good camera or other single gimick

    3. Marketing

    How many Americans wanted the Z series but they are not available – so no one learns from their friends. We have a short mental span and we want it when it is fresh. So hook us up now, not later.

    HTC always had better phones but never shook the exclusive models which cost more to design and produce. When Samsung hit all US carriers and with the same name along with a huge marketing push…they took the market. LG has set up a better profitability for next model if they call it G4 from the G3 marketing.

    They also did not have good names through the years. (example DROID chanaged too much while Samsung/Apple stayed consistent).

  • Cwalden21

    What they need to do is quit beating around the bush and bring their phones to the U.S. quicker and make them available to all carriers. If AT&T had the Z3 i would pick it up in a heartbeat. Get the product available everywhere and it will sell.