Sony’s Rise and Fall

Doyoung Park, Osaka Gakuin University

Established in 1946 Masaru Ibuta, Akio Morita Representative electronics company of Japan One of the world's largest media conglomerates

Revenue $78.88 billion U.S. (FY2008) Employees: 17,555 Related employees: 180,500

World’s ranking of the brand value: #25 Business Week 2008

Models as Sub Brands

History of Sony

Tokyo Telecommunications Engineering Conpany ,1946

Tape recorder market share 91%, 1950 Developed a transistor radio, 1955 Pocket size radio, 1957 Change the name of the company to SONY,

1957

Sony Rolly in Motion, 2007

The Rise and Fall of Sony

Sony

Sonus (sound, sonic) + Sonny (baby) Identity of the maker of small sound device Easily pronounced in every country Successful naming

Morita’s Choice

Sony attempted to export radios to USA, 1956 US buyer offered OEM order 100,000

Using their brand instead of Sony Headquarter wanted to accept the order Morita decided to decline the order to keep Sony

brand

When Morita retired, “My decision in 1956 which sacrificed short-term

interests but pursued a long-term goal was the best choice that I have ever made for Sony.”

Globalization

Sony USA 1960s Factories in USA and UK 1970s First Japanese company in NASDAQ Went globalization Sony as the global company Avoid the competition with Hitachi,

Matsushita in Japan

Trinitron

Sony’s advanced color TV, 1968

Walkman

1979 Compact tape player Popular in America Created a new life style Meism

Handycam

First personal video camera 1985

Sony Style

Technology + New life style

Into the Entertainment Business

Expanded the territory to Entertainment business

CBS Record 1988 Columbia Picture 1989 Japanese company conquered American

show business!

Beta, Sony’s Lost

VHS VS Beta max 1974-1988 Sony developed Beta video format

Tried to be an industrial standard Matsushita developed VHS

Beta was superior to VHS VHS occupied rental video market

Contents suppliers chose VHS Sony released VHS VCR 1988

Return of Sony

Play Station, 1994 Competed with Sega Saturn and

Nintendo 64 CD-Rom 3D graphics 100,000,000 sold by 2004

Final Fantasy 7

Killer title of PS Open to game companies

PS2, 2000

Conquered the game console market Compatible with PS1 DVD, Enhanced 3D Defeated Xbox and Nintendo Cube 140,000,000 sold

Obsession with Sony Format

Memory Stick Compete with SD card

ATRAC Sound compression technology for Mini Disk Compete with MP3

Lost in Music Device

Stuck to MD players and ATRAC format Late entering the digital music device

market MP3 Walkman defeated by Ipod

Lost in Flat Screen

Stuck to Trinitron Late entering LCD TV market Samsung has #1 market share in LCD TV S-LCD

LCD manufacturing company – Samsung + Sony

Bravia

Lost in Game Console

PS3 Full package of high technology Delayed release Defeated by Nintendo Wii and Xbox360

Sony in Troubles

Deficit 99 billion yen, 2008 120 billion yen deficit projected, 2009 Laid off 16,000 employees to save 100

billion yen 6 factories closed among 57 Questionable Market reading ability Late decision process