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CES 2011: Sony Outlines 2011, Long-Term Strategies

1/06/2011 08:51:38 PM Eastern

Las Vegas - Sony's
top executives detailed the company's extensive 3D and Internet TV plans to
reclaim its leadership position in the U.S. CE market.

During a media
briefing Thursday at International CES, Sir Howard Stringer, chairman,
CEO and president, Sony Corporation; Hiroshi Yoshioka, executive deputy president,
president of consumer, professional and devices Group, Sony Corporation; Phil
Molyneux, president and COO, Sony Electronics; and Kuni Suzuki, corporate
executive, senior VP and deputy president of networked products and services group
(NPSG), president of Vaio and mobile business group, NPSG, deputy president,
Sony Computer Entertainment (SCEI), held court, giving details of their near-term
and long-term strategies.

When Molyneux was
asked about the challenges facing Sony to become No. 1 in CE in the U.S. by
2013, a major company goal, he noted, "One of the key challenges which we're
already working on is collaborating at a different level with retail partners.
We want to collaborate with messages that consumers can understand. We need to
show consumers inside the store the reality of using the 3D camcorder and the
immersive experience they can create for themselves."

He added, "We need
to improve retail execution. Consumers are attracted to our products and we
want to take [that attraction] to another level."

When asked what
role Sony Stores might play in all this, Molyneux said, "We need to improve [the
consumer] experience in our direct channel. We have ample opportunity to
improve there as well. We tend to be cluttered with multiple SKUs [in Sony
Stores]. We need to be more focused. Sony Direct locations should be ‘Sony
Wonderlands' for consumers ... [and] generate walk-ins to see the very best from
Sony and the wonderful things they can do with our products."

The
products that they hope drive the business are 3D and Internet TV.

Stringer
reiterated what he said at Sony's press event Wednesday: "We have 50 million Internet
devices in the hands of consumers -- it's an opportunity for our customers to
connect to Sony well ahead of other devices," with Blu-ray, computers, PlayStation3
and Bravia TVs. He added, "3D gets personal" with the company's Bloggie and
camcorder products, which should boost interest in the format.

Sony's position in
all these consumer hardware categories and from content creation to production
equipment gives it a unique position in 3D, Stringer said, but it is going to
take time.

But Molyneux
pointed out that Sony's 3D sales in the U.S. during the holidays "took No. 1
market share. The market share is widening [and] consumer acceptance is moving
up."

Stringer noted
that 3D "will become a feature. When you start showing shows in 3D ... like ‘Law
& Order' or ‘CSI,' you'll ignite the audience. It is not an overnight
thing. You have to keep pressing it and audiences will grow accustomed to it
and skepticism will die."

Sales training at
the retail level is vital, as are deals for further content, but, again,
Stringer said all of this "will take time."

Some of the same
factors are in play with Internet TV. Sony introduced Google TV during the
holidays, and Stringer described sales as being "solid" but that "a lot of work
has to be done to explain to consumer and retailers," the product's
capabilities.

"Tens of millions
are using the Internet to get content. The public is slow to adopt because it's
another big purchase. We have to be patient, just like with Blu-ray ... which
made 3D possible."

Yoshioka
commented, "The future of TV is integration. TVs will need to be Internet
ready, something like PC. It should be a very portable environment for the
consumer. You should be able to enjoy any content, search any content," with
the new age of TV.

Sony is not
participating in one main product category at CES -- tablet PCs. Stringer said philosophically
at one point: "We won't be first every time, not with this big of a company."

Specifically,
Stringer noted, "If I want to differentiate, do I release it tomorrow, or do I
wait and differentiate? We need to put a tablet on the marketplace that is
differentiated."

Suzuki noted the
iPad "is the king of the tablets now, for sure. But who will be the second
player?" He added that Sony wants to bring something value-added to the marketplace
and wants to be the No. 2 player in the market when it offers its first tablet
in 2012.

When asked if it would
be logical to assume the Sony tablet would have 3D capability, Stringer said,
"We consider all these things," but Suzuki was more expansive.

"Industry
forecasts for 2012 in general -- 500 million units of smartphones, 250 million
units of notebook computers and 50 million tablets." He added that with "any
one" of the categories Sony would have to consider 3D, but the company has to
be "careful approaching that space in customers' point of view."

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