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Sony’s Nishida Marks 1st 6 Months With Positive Sales And Tech Talk

NEW YORK -Fujio Nishida marked his half-year anniversary as Sony Electronics president by discussing his company’s increased market share, the marketplace in general and new technologies, during his biannual meeting at the Sony Building, here, last Tuesday.

In his first press conference since becoming president in the spring, Nishida covered the waterfront, and then some: Sony’s CE sales were excellent during its fiscal first half; Thanksgiving weekend retail sales were good for the industry; DVR-Blue recordable decks should be on the market “in two years”; and Sony would not introduce HDTVs it planned to ship until the 8VSB/COFDM format battle is settled.

Nishida said retailers had “overall strong sales which met expectations” during Thanksgiving weekend. While acknowledging they were worried prior to the launch of the holiday season, he said retailers seemed “not extremely happy, but satisfied.” Retailers Sony surveyed had sales increases from 4 to 14 percent, which was a good sign due to retail concerns about a possible slowing economy, sagging stock prices on Wall Street and the ongoing battle for the White House.

He noted that for the weekend sales of projection TVs and big-screen sets 32-inches and above were “very strong” for the industry, but hi-fi components suffered a 5 to 10 percent downturn. On the audio front, the only real strength was from home theater products.

DVD deck sales were up 35 to 45 percent, but he cautioned that much of it was due to entry-level products that were priced from $79 to $99. VHS decks were also strong due to the same reason. Promotions also helped home satellite sales, digital cameras and personal audio products during the weekend. Camcorder sales were still strong, up over 10 percent, driven by some entry-level pricing, although Nishida did indicate that 8mm and D8 camcorders did very well.

Nishida was also buoyant about Sony Electronics’ first half, which showed a 35 percent increase in CE sales during the first half, which outpaced the industry. “In the first half our incremental sales volume is $1 billion, just in consumer business.” Sony Electronics’ CE sales now represent 30 percent of Sony’s global consumer electronics sales, Nishida said.

Sony Personal Network Solutions Company, which is responsible for computers, PDA and digital imaging products, had a 50 percent increase in sales during the period. Sony Home Network Products had a 35 percent increase in sales. In the PC market Sony’s sales are up 70 percent for the half, with Nishida reporting that during October, for the first time, its Vaio notebook PC line became the No. 1 brand at retail. Digital imaging sales for Sony was up 40 percent during the half, with the company having No. 1 shares in digital camcorders and digital still cameras. Due to the popularity of DVD players, the home audio/video category was up 25 percent during the half. Car stereo sales were up 50 percent, personal audio sales were up 15 percent, and MiniDisc sales were up 40 percent.

And the Wega line of flat-screen direct-view TVs continues its success story, Nishida said, with TV sales up 45 percent due to the line. Sony claims a No. 1 share in dollars for projection TVs and big screens combined, and an 80 percent market share of the 36-inch and above market for flat-screen sets, Nishida said.

Concerning technology, Nishida made the following pronouncements and observations:

  • HDTV-The HD100 tuner will be available “very soon,” according to Nishida. When asked if Sony would again show its HDTV line at CES in January, which it debuted at this year’s show and decided not to ship this year, Nishida said, “We will not show them at CES. We will be ready to ship once [the standards] are decided” between the battling 8VSB and COFDM formats.
  • Recordable DVD-Sony will show DVR-Blue prototype, which it had showed at the CEATEC in Japan during October. About 22 gigabyte deck which can record two hours of high definition video is the goal. Nishida said that DVR-Blue would be the “ultimate application.” He added that DVD recordable formats are a “transition” until DVR-Blue is available and affordable. When asked about a format battle and the chances for the various factions to unify behind one approach, Nishida said, “My personal opinion is there will eventually be one the foreseeable future.” When asked later about consumer confusion next year, he noted, “That is regrettable, but we [Sony] cannot set policy” for the entire industry.
  • PS2-The microprocessor yield for PS2s has improved, according to Nishida, so shipments to the United States have increased to 100,000 a week since its introduction on October 26. With the initial shipment amount of 500,000, plus 800,000 units that will be shipped to the United States by December 25, Nishida predicts 1.3 million PS2s will have reach consumers by Christmas. While not commenting on how many orders PS2 retailers have received from consumers, he did say that Sony will catch up with demand during the first quarter.
  • Memory Stick-One hundred and seventeen manufacturers now support the flash memory format in 20 different product categories. New configurations of the format, a dual Memory Stick which is half the size of the original and be introduced next year, will make it more adaptable for cellular phones, PDAs, and other small devices. In two years he predicts a 1 gigabyte Memory Stick. The current size of the memory card is 128 megabytes.
  • TiVo-Nishida quoted research study showing that 20 million TiVo set-top boxes will be sold by 2003. “This is a significant number because currently there are 10 million DirecTV boxes” being used by consumers, he said. The Ultimate TV, which is a combined WebTV unit and personal video recorder, will be out “in a couple of months.”
  • Super Audio CD-He expects the first deck “below $1,000 very soon” and is hopeful that more software from companies such as EMI will be available soon.