Sony forecasts record annual loss of $6.4bn | Hacker News Reader

Sony forecasts record annual loss of $6.4bn

aljazeera.com

34 pointsnoinput39 comments

Sony used to be a brand associated with quality and good design. It took them a while to build that reputation. But then they stopped being better than their competitors (and not necessarily saying they got a lot worse, maybe their competitors got better faster). So for many years they kept riding the quality and brand recognition train. But the train is slowly coming to a stop I think.

Used to be like Apple is today. I remember shelling an insane amount for Sony Viaos a while back, and they were worth every penny.

Yep. Sony is a lot like Bose (and probably other examples) to me; they continue to make high quality items, but there is almost always a functionally equivalent product to be had for a better price. In a world where it's so easy to read reviews and price shop, they're getting crushed.

> not necessarily saying they got a lot worse

I am. The Sony of now is significantly worse than the Sony of 20 years ago. I think this followed from one primary thing: shift to software, which Sony has been absolutely terrible at forever. I owned a NetMD, and if you think iTunes is terrible you've never had to use OpenMD Jukebox (or its equally horrifyingly terrible successor SonicStage). See also: PSN, or the bloatware they shovel onto their computers.

They've also spread themselves too thin trying to cover low and high ends of the market, making themselves unremarkable at the low end and under-average at the high ends.

And of course lashing out against threats to its outdated business models (Sony BMG XCP) and mis-handling of many properties, riding horses to death (I'm sure I'm not the only one with pretty bad memories of the way Sony Online Entertainment managed pretty much all of its games and relation with players, aside from the PSN fiasco) has likely made them pretty unpopular with the technically savvy crowd.

My gripe with Sony has been their insistence on proprietary technologies. I was happy to hear that the PS3 uses Bluetooth for its controllers, but it seems like they waste time engineering and manufacturing their own solutions for everything they possibly can.

That is a good point, I've always been impressed that Sony could go further than even Apple in its wedding to proprietary techs.

> I think this followed from one primary thing: shift to software, which Sony has been absolutely terrible at forever.

I think this is true for all Japanese companies (all of East Asia, for that matter). I think the issue is a lack of English proficiency, which makes it difficult to keep up-to-date with the latest in the software world, which moves at breakneck pace.

Take a look at any Japanese website - the designs are at least 10 years out of date. The same is probably true for the backend. It's like you really are going back to the 90s.

> I think this followed from one primary thing: shift to software, which Sony has been absolutely terrible at forever.

A very interesting phenomenon (and it has been discussed here as well) is how software has always been seen as inferior to hardware in Japan. Besides Ruby, what other well known software packages or services are coming from Japan? I can't think of one of the top of my head.

There is also a culture of "appliances" there. They are infatuated with appliances and robots where hardware comes through as the main feature rather than with general PCs and laptops where software is at the front stage. I think there is a cultural difference there. But I think at some point Sony realized that that not focusing on software is a problem, and perhaps an order came from the CEO to "start writing more software". But of course you can't change the entrenched company culture easily. So I think they got distracted with that, they wasted resources and ended up with inferior hardware and inferior software as a result.

Carbon emacs also comes from Japan, IIRC.

Maybe this means they will be forced to sell Sony Music. That would mean the music labels would consolidate even further. But that's fine with me. It will be bad in the short term, but the more monopolistic they'll become the sooner artists will quit them, and the big labels will finally die.

How many people in your immediate vicinity do you know who still have a Sony product aside from a Playstation?

I could think of only one and he's got IEMs they do not make anymore...

Are there any popular Sony electronics left out there?

I see Vaio laptops fairly frequently at my university. Is Sony positioned internally in other supply chains too? That is, do we see Sony parts in other products?

Does Sony still make Apple's batteries? I can't find the info anywhere.

Samsung was iSuppli's best guess. It's an "Apple" branded battery usually on the inside.

A lot of Nikon's DSLR use Sony sensors. The recent D800 is using a 36MP Sony sensor for instance.

Consumer-grade video cameras are a large market where Sony is strongly positioned. Walk into a Best Buy and you'll see Canons out front of the digital camera section, and Sony out front of the video camera section.

Consumer-grade video cameras are being replaced by cell phones.

And DSLRs.

Agreed. Although I would call it prosumer, which is just a consumer with a bigger budget :-).

I own a Sony alarm clock. It is very cheap both in price and quality. I plan to replace with an iPhone stand.

That reminded me that the last Sony product I purchased was an expensive, bulky, CD-playing alarm clock. Every morning I woke to the excessive noise of the CD spinning up, rather than to my music. :-)

It's the most common brand of TV I see, at least for larger models.

Their DSLT and mirrorless cameras, while well behind CaNikon in popularity, are becoming more popular and more importantly, gaining respect because they're actually innovating when it comes to cameras rather than the more-megapixel, high-ISO chest-banging that tends to go on.

That's 6.4 Instagrams!

(Sorry, I saw an editorial talking about a tax proposal and the budget deficit in terms of Instagrams instead of billions. Yay for trendy new units!)

That works out to about 31% of their current market cap. Wow.

Wow indeed. I hope this doesn't affect the development of the Playstation 4.

If they blink, if they hesitate, they've already lost.

Microsoft has mountains of cash to throw at their new XBox project. Apple isn't going to stop making iOS devices. Even Amazon might weasel in.

It would be a mistake for Sony to forget Valve and Steam in that list as well, rumor being they have a console in development as well.

Valve making a console would put them between a rock and a hard place - either force Steam users to use the console and alienate their loyal PC base, or compete head-to-head with the PC market and have a hard uphill battle.

Are you suggesting the console market is always competing head-to-head with the PC market?

I would argue a steam console that played console-oriented games using the steam platform is a great idea to compliment the pc-based service, and not competing head-to-head.

I think Valve's titles are very PC-centric.

I'm guessing that they will continue this route, even if they made a "PC-in-a-box". If I'm a Valve customer interested in 1st party titles (HL3, L4D3, Portal 3, etc.), why would I buy a console (even if it is a Valve one), when I can already play their games on my PC?

> I would argue a steam console that played console-oriented games using the steam platform is a great idea to compliment the pc-based service, and not competing head-to-head.

I think Sony is in a great position to do this (see their partnership with Portal 2), although the PSN team might have something to say about that. Maybe Nintendo can partner with them to flesh out their online story.

All-in-all, it's a tough sell (at least from what I can see). If they do launch it I don't see it being anything more than a niche device.

They can overcome this by pulling off other tricks, like including a subscription to all Valve titles, or making it extremely cheap, or some sort of exclusivity (at the potential cost of their PC fanbase). Otherwise the value proposition is basically a prebuilt PC with the Valve logo on the outside.

> I think Valve's titles are very PC-centric.

They certainly are. But Valve has proven nimble in the past, so I wouldn't pulling off a transition to the console space past them. After all, Microsoft was able to do it successfully.

I think the key difference we'll see between traditional console gaming and the Steam Box (if it materializes) will be a complete elimination of physical media and a corresponding sea change in the pricing models (pretty much the same as what we see on Steam right now). Obviously, existing console makers like Sony, Microsoft, and Nintendo are loathe to cannibalize existing sales by moving online. But Valve has nothing to lose - even if it cannibalizes some PC game sales, they'll still be making the same (or similar) amount of money.

> why would I buy a console (even if it is a Valve one), when I can already play their games on my PC?

Remember, Valve is no longer just a game developer - it's also a content distributor for the PC gaming industry at large. Originally, it had to jumpstart Steam with its own titles, which are definitely PC-centric. But now that Steam is an established player in the PC gaming industry, it will be much easier to convince prominent 3rd party console game developers to develop games in advance of the Steam Box's release. Valve no doubt has clear financial data showing the advantages (for game developers, not for the console makers) of shifting to a digital distribution model.

I don't think they need to compete head-to-head. They'd compliment each other.

This isn't too different from what Steam already does with Windows and a Mac version. Two platforms, one Steam. Users will use whichever they like more, and Steam wins either way.

It's also no different from Microsoft promoting Windows as a gaming platform while also owning x-box. Both are profitable, and both get exclusive content.

Not really. If they came out with a PC that boots to Steam (obviously with Windows behind it) and has solid hardware with a stable configuration, I imagine they could leverage some publishers to build games that would run on that hardware. These same games would run on regular PC hardware without modification to the code just like a normal PC game. The "Steam Box" or whatever they call it would just serve as a "here's what to aim for" for developers and as a stable platform for less hardcore PC gamers.

There'd be no way they would make a traditional console, considering they have no games ready to launch a console yet have a huge library of PC-ready games. This mythical Steam Box I've described would sit between Alienware and Xbox 360.

The funny thing is that a hardware device would literally just be a PC that has a more appliance-like Windows UX.

They should really spin off PS into a separate company.

I wonder how much of this is down to them drinking their own Kool-Aid or believing their own hype. It seems to me that each time they are about to release a new console they make ridiculous claims about how their new processor is going to make the PC obsolete. I know that people have used PSen of various generations to make "supercomputers" but their impact outside of gaming has been close to zero.

OTOH my most recent laptop was a Vaio and I'm very happy with it.

Sony's decision to remove OtherOS functionality, thereby killing the PS3's utility as a supercomputing component, was made in order to staunch losses. The Cell architecture was expensive and every PS3 was sold at a loss, with the idea being to recoup money in game licensing fees. Obviously there weren't many games being played on supercomputers, so once Sony had the feelgood story of the Air Force building supercomputers out of PS3s, they quietly pulled the plug.

This is a long-winded way of saying the PS3' lack of widespread use in supercomputing is not responsible for Sony's losses. Rather, blame their flailing consumer electronics and mobile business.

Sony products have been decent but way overpriced for a long time now.

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