SONY TO OUTSOURCE 40% OF TV OUTPUT TO REGAIN PROFITABILITY
SNE | Quote | Chart | News | PowerRating -- Sony Corp. (TSE:6758) is seeking
to turn its money-losing television business around by
increasing outsourced production to 40 per cent in fiscal 2010
under a three-year business plan announced Thursday.
Outsourced TV production will likely account for roughly 20
per cent of total in fiscal 2009. By relying more heavily on
outsourcing for development and production, the company aims to
reduce costs. The business plan calls for boosting its LCD TV
global market share to 20 per cent in fiscal 2012 from 13.9 per
cent in 2008.
Sony will cut costs deeper in its game business, which has
also been bleeding red ink. Sony has already reduced the cost
of its PlayStation 3 console, but plans to lower it another 15
per cent in fiscal 2010.
The company will focus more on growth fields, such as
lithium ion batteries and services using the Internet. It will
invest about 100 billion yen in lithium ion battery operations
over the next several years, with an eye toward entering the
automotive battery market.
Sony will launch an online service delivering movie, music
and book content to such devices as TVs and portable music
players, targeting 300 billion yen (US$3.4 billion) in annual
sales by fiscal 2012.
And next year, the firm will introduce TVs and game consoles
compatible with 3-D technology. Including equipment for
broadcasting stations, the goal is to generate more than 1
trillion yen in sales for these products.
In June 2008, Sony unveiled plans to invest 1.8 trillion yen
in strategic areas over a three-year period. But earnings
deteriorated rapidly amid a global economic downturn. The firm
conducted a management shake-up in April, with Chief Executive
Howard Stringer taking over as president to right the
struggling electronics division.
For fiscal 2009, Sony expects to report an operating loss of
60 billion yen, a slight improvement from its initial forecast
and marking its second straight annual loss.
(Nikkei) bl
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