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Sony buys Ericsson out of mobile phone venture

Sony buys Ericsson out of mobile phone venture
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First Published: Thu, Oct 27 2011. 09 50 PM IST

Photo: Bloomberg
Photo: Bloomberg
Updated: Thu, Oct 27 2011. 09 50 PM IST
London: Sony Corp. is to take over the Sony Ericsson mobile phone joint venture for €1.05 billion ($1.45 billion), as it seeks to catch up with smartphone and tablet makers Apple Inc. and Samsung Electronics Co. Ltd.
Photo: Bloomberg
The deal to buy out its Swedish partner gives Sony ownership of certain handset patents held by Ericsson and will enable it to integrate the joint venture’s output with its own range of products and content.
“Its the beginning of something which I think is quite magical,” said Sony’s chairman and chief executive Sir Howard Stringer.
“We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment”. Until now Sony’s tablets, games and other consumer electronics devices have been kept separate from the phones sold and created by Sony Ericsson.
“Sony is looking to do the same as Apple and meet user’s demands through linking various devices with similar interfaces and operating systems,” said analyst Nobuo Kurahashi of Mizuho Investors’ Securities in Tokyo.
“Since television sales are set to fall smartphones look to become more important products for Sony since their sales are rising globally and they will probably become the main device people use to connect to the Internet.” Smartphone sales have been surging since Apple launched its first iPhone in 2007 and despite a slowdown in the overall consumer electronics market the strong demand for smartphones is expected to continue.
“Sony now has all the components to compete with Samsung and Apple. The big question now is ... can it execute ?,” said Pete Cunningham of industry consultancy Canalys. “Based on history I am sceptical but I would not say it cannot be done,” he added.
Veronica Ek, Olaf Swahnberg and Patrick Lannin in Stockholm and James Topham in Tokyo have contributed to the article.
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First Published: Thu, Oct 27 2011. 09 50 PM IST
More Topics: Sony | Ericsson | Sony Ericsson | Smartphones | Phones |