As it stands, Sony Ericsson is the 6th largest mobile phone manufacturer in the world, but Sony may be looking into going it alone. According to a new report from the Wall Street Journal, Sony is close to finalizing a buyout of Ericsson’s stake in their joint venture.
According to the usual unnamed sources, current talks are tenuous at best. That doesn’t seem to have dampened Sony CEO Howard Stringer’s mood: he reportedly wants the deal finalized as soon as possible.
Sony’s big issue seems to stem from control, and specifically the lack thereof when it came to Sony Ericsson’s phone lineup. By bringing phone design and production in-house, the Wall Street Journal believes that Sony could leverage their “technology strengths to develop new innovative handsets more quickly.”
I don’t know how much I agree with that sentiment, but I will say this: it’s worth a shot.
It could be that the Sony Ericsson experiment has run its course. Together, the pair managed to snatch up a considerable portion of the market back when it all took to make a popular phone was to jam multimedia functionality into it. Times have changed, to say nothing of people’s expectations, and now Sony Ericsson finds itself as the perennial also-ran of the smartphone industry.
Let me ask an honest question: when was the last time you looked at a Sony Ericsson phone and felt something stir inside you? Your answers will almost certainly vary from mine, but I’d wager it’s been a while. Mine was the original Xperia X1 — a phone that pushed enough of my buttons that I could overlook the fact that it ran Windows Mobile. That phone came out three years ago — none of the people I posed the question to named a phone newer than that.
The joint venture made all kinds of sense back in 2001, and even for some years after that, but these days it seems like Sony Ericsson has become listless. They slowly churn out smartphone after smartphone to an audience that wants them less and less each year.
I’m trying hard not to throw Ericsson under the bus, because they haven’t really done anything wrong. Still, their main business is developing and rolling out telecommunications networks. It’s not that Ericsson is screwing anything up so much as the fact that the two companies may not share the same priorities or vision. Their 2009 agreement to join up with STMicroelectronics doesn’t really help things, as companies like HTC have recently been making use of their products.
In short, Ericsson doesn’t need the mobile phone business as much as Sony does.
Sony Ericsson CEO Bert Nordberg seems to get it. In an interview from last week, Nordberg mentioned that the company was closer to Sony than it was to Ericsson. Under his guidance, Sony Ericsson is aiming to be a 100% smartphone-focused company by the middle of next year. If a Sony buyout took place, and Nordberg ran Sony Mobile with the full backing of a parent company that would like to control the consumer electronics market end to end, we could be looking at a brand new beast.