Sony Ericsson Idou Phone

There is no question that the Sony Corporation (ADR) is struggling. A recent $1.7 billion impairment charge for the company is the result of a projected overall decline in their mobile phone sector. The current market for mobile phones is quickly developing and Sony simply can’t keep up; their share of the global smartphone market has dropped from 4% to 3.1% in one year. Furthermore, this is the first year since its inception that Sony will not be able to pay their shareholder’s a dividend. Sony is beginning to tear at the seams, and it is time for them to rebuild.

Sony’s current business strategy is to “reduce the size of the division, and concentrate on the fanciest smartphones”. Frankly, this is not the wisest decision for Sony. I would recommend that they completely shut down other mobile phone unit, and look to invest their time and resources elsewhere. Fortunately, Sony is such a large firm with such a wide variety of products that there are many viable alternative sectors for them to invest in. If a sector of a company is damaged to the point of no-recovery, it is only reasonable to “pull the plug”, is it not?

References

“Pouring Cold Water.” The Economist. The Economist Newspaper, 20 Sept. 2014. Web. 24 Sept.                   2014.