Sony Exits PC Market, Cuts 5,000 Jobs

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Sony is exiting the PC business and plans to sell off its Vaio personal computer division and is cutting 5,000 jobs. Company CEO Kazuo Harai is also splitting off Sony's TV division into a separate business in hopes of turning around a ten year US$7.8 billion loss.

Sony is bailing out of the PC industrySony is bailing out of the PC industry

While Sony is letting its PC business go completely, that isn't the case with its television division. The company's TV business will operate as a wholly owned subsidiary, which will give it enough autonomy to react quicker to the television market.

"I think we are heading in the right direction, and by making it a separate company we will speed decision-making up," Mr. Harai said. "As for the future, there are many possibilities, and not just for our TV business."

Dumping its 17 year old Vaio division underscores just how difficult the PC market has become. Sales have been declining world wide for years while tablet sales are on the rise.

Much of the growing tablet market belongs to Apple and its iPad, and that's eating into PC sales. Android OS-based devices are playing a part in that erosion, too, adding to overall PC sales losses.

For Sony, the PC business has become a losing proposition, and to a degree so has the television market. Considering Sony is revamping its TV business and dumping PCs, it says a lot about where the company sees the future of personal electronics.

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Comments

aardman

How different might have things turned out if Sony had jumped back in ‘01 when Steve Jobs offered to license OS-X.

Though Steve might have thought later on, thank god Sony passed.

geoduck

Sorry to hear that. The Vaio line were not terrible systems.

Substance

The VAIO was a generally reliable line and sometimes best-of-class.  This is just another example of how little profit there are in PCs.  The same reasons why PCs proliferated like bunnies in the mid-80’s and beyond are also the same reasons why so many large PC makers have died and why there has been so little innovation on PC hardware. 

Just off the top-of-my-head, the PC box maker death-knell list is pretty impressive.
- Compaq
- Packard Bell
- IBM
- Gateway
- eMachines
- Micron
- and now Sony

geoduck

Substance:
Let’s not forget AT&T. Back in the early ‘90s where I worked the companies salesman came in happy as a pig in slop. He’s gotten three AT&T computer systems. He’s haggled with the store and got them at a great price, and he let us know it was only because he had a “brilliant head for business”. While he was crowing about the fantastic deal he got, the announcement came over CBC radio that AT&T was dropping their attempt to enter the IBM Clone PC market. Effective immediately the systems were being cleared out at a loss with no warranty or support after that day.

Suddenly this “brilliant salesman” didn’t look so smart after all.

marcsten

I don’t profess to be intimately familiar with all WIndows PC hardware, but my impression has always been that Sony’s was a cut above in quality, form, and price. Given the changes in the market, sadly this move probably is the only one available to Sony unless they wanted to start copying what is largely junk on the market at the low end. I seriously doubt they could ever have sufficient volume to make a go of it at that end.

mrmwebmax

+

Substance,

Don’t forget that in the early 80s there were a number of computers running operating systems other than DOS or Mac:

—TRS-80
—Sinclair
—Atari 400/800
—Commodore VIC-20, Commodore 64
—TI99/4A (my first computer)
—Atari ST
—Commodore Amiga

As for the loss of Sony Vaio, I find it interesting that Sony couldn’t make a go with what were arguably premium Windows machines, while Apple continues to make a go with premium Macs. I think that speaks volumes for what people look for on the Windows side of things (cheap and good enough), compared to what people expect on the Mac side (premium build quality, premium user experience).

Jamie

I have to think that the PC era was a bit of a fluke anyway, in certain terms. Access to the web is what drove computer sales to their highest heights - prior to that they still resided somewhat in a niche - beyond word processing, most people didn’t have much of a practical reason to have them around, and indeed, there were many dedicated word processing machines back in those days so that people didn’t need to have them around.

Really, had there been an alternative like modern day mobile devices available at the time to access web services, I suspect it’s likely there never would have been a boom for many of the companies listed to begin with. PCs are rapidly becoming specialty items for specialized use, and for good reason: the majority of people will never have need of a high end work station. The fact is, they *never did*, but at the time, that was the form factor available. It begs the question: what would the past 15 years have been like if Microsoft hadn’t had their stranglehold on the world? Might the post-PC era have come years sooner?

And incidentally I do work that *does* happen to require a work station class machine, I’m typing from my new Mac Pro. I suspect eventually even this will be replaced by a smaller hub (and really, a hub is what it is).

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