Sony Ericsson is to focus solely on making smartphones in 2012

Lee Bell
October 14, 2011
1 Comment

sony-ericssonMobile phone manufacturer Sony Ericsson is to focus solely making smartphones in 2012, the company announced today.

The move might be something to do with their Q3 earnings figures for this year, which in a report reflected a breakeven year-on-year result. Not really what most companies want to hear. Sony Ericsson blamed the outcome on lower profit margins and higher taxes, which rose by $8 million over the course of a year. Well, it could be worse, like Q2 when Sony Ericsson posted a net loss of nearly $70 million. Ouch

There does seem to be a lot of changes going on in the company at late – perhaps it’s giving itself a kick up the butt? There were reports yesterday that the mobile makers were interested in buying out the ‘Ericsson’ to become the ‘Sony’ they once were. Oh Sony and Ericsson; will your 10-year marriage end in the realisation that you’re better off alone after all? This was just speculation however, and if it was true, it was merely doubts Sony was having. Aww, poor Ericsson, how unloved you must feel.

On a more serious note; the company’s Q3 results from 2011 are still an overall loss in profits and sales compared to the same quarter in 2010. It seems something has to be done. But will the move to smartphone-only manufacturing be the right one?

They don’t exactly have the best reputation in the smartphone industry, with competitors such as the iPhone and Android always being that step ahead of the game. According to the BBC, Sony Ericsson was ranked 11th on the list of most profitable phone manufacturers in Q2 this year. You’ve got some catching up to do Sony/Sony Ericsson – what ever you decide your name is.

Sony Ericsson’s CEO, Bert Nordberg, seems to think it’s the right thing to do…obviosuly. With Sony Ericsson’s improvement on this Quarter’s results to last Quarter’s (a break even as opposed to a $70 million loss), Nordberg explained that the company’s smartphone range – Xperia phones – has been the most profiting aspect of their company and was the reason for their change in strategy. They do account for 80% of its sales and it has shipped 22 million of the damn things to date after all.

He said: “We will continue to invest in the smartphone market, shifting the entire portfolio to smartphones during 2012.”

The question is, will this new “strategy” be a match for other competing mobile devices in this iPhone and Android-strong market?

 

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Tags: android, Article, iPhone, Sony Ericsson
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