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Sony needs more than MJ to wow users

(China Daily)
Updated: 2009-07-23 09:58

An innovation slump is what's killing Sony's bottom line. Here, a big anniversary adds insult to injury. It's been 30 years since the 1979 unveiling of the Walkman, the portable music player that revolutionized the electronics world in the 1980s and became emblematic of Japan's economic rise.

More recently, Sony has been a microcosm of what ails Japan. Like Japan, Sony is a behemoth that once set the global standard, but has since lost its primacy and self-confidence. Sony, also like Japan, grew complacent at the worst imaginable time - amid a rapidly changing global environment.

While Sony rested on its laurels, South Korea's Samsung Electronics Co churned out smart products, earned money and surpassed Sony's market capitalization. Samsung isn't about to cream Apple, yet its shares are up 53 percent this year; Sony's are up 20 percent. Of course, Sony's gain is nothing to sniff at in this global environment. The real question is the future.

Stringer is still whittling away at the excesses of the 1980s, a period when many Japanese companies got overextended. It was a time when executives thought they had to be in just about every market. The result was that Japan's corporate giants are involved in everything, but stretched too thin.

On June 19 Stringer told shareholders he is making "steady progress" in cutting costs. There are limits to what Stringer, Sony's first non-Japanese chief, can do, though. Culture is part of the challenge. Within Sony are myriad fiefdoms with proud traditions of autonomy. Change comes slowly. An even more stubborn reality is that fat-trimming is no substitute for killer products.

Even speculation about where Sony goes from here seems underwhelming. The Japanese press is buzzing about Sony developing a portable PlayStation video console with cell-phone features. Given that Apple's iPhone has its own gaming features, let's hope Sony is thinking big here. Very big.

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