Sony Mobile CEO and President, Hiroki Totoki, has given an illuminating interview to Arabian Business touching on a range of topics, including the company’s position in the mobile space. When addressing rumours about Sony potentially selling its mobile division, Totoki says that Sony “will never ever sell or exit from the current mobile business.”
Totoki talks about 2015 being a “year of big transformation” with hopefully an improved performance in 2016. Remember Totoki has only been in the Sony Mobile CEO hot-seat for nine months. He goes on to refer to an industry with “severe” competition, but believes Sony can come on top through new technology and high quality products to drive the user experience. Check out some choice quotes below and the source link for the full interview.
Totoki on Sony Mobile’s turnaround
“I’ve had to work very hard and I have been busy, but people are very cooperative and have shown a lot of energy to turn around the position, which is a good thing. I’m confident that things will continue to get better. We are trying to decrease our costs by 30 percent to the end of 2016, and reduce our headcount by 20 percent. We are trying to streamline the organisation as well as our product portfolio to maximise our profitability and improve our ROI”.
“We have set out our plan already and are just starting to execute it. This year, 2015, is a year of big transformation, and we will try to complete this transformation by the end of the year, and hopefully see an improvement in financial performance in 2016.”
Totoki: Sony has no plans to ever exit from mobile
“The speculations arose because in 2014 we made a huge loss as a mobile business. It mainly came from the write-off of the goodwill of our impairment asset. When we bought back Ericsson’s share [in 2012], we bought back 100 percent of it. And obviously that price was high. We had to write it down and it made a substantial loss for the company.
“But this was an accounting loss and did not impact our cash flow. Our cash flow is very healthy. But the accounting loss was so huge — that’s why people have speculated like this. Before that rumour, we exited the VAIO business, which was the PC business. That led people to think that Sony would exit the smartphone business, as well. But the smartphone business is very different from PCs.
“Smartphones are completely connected to other devices, also connected to people’s lives — deeply. And the opportunity for diversification is huge. We’re heading to the IoT (Internet of Things) era and have to produce a number of new categories of products in this world, otherwise we could lose out on a very important business domain. In that sense we will never ever sell or exit from the current mobile business.”
Totoki on the competition
“When we introduced the Z3 to the market it was very well accepted. But now we see a lot of emerging players, including Chinese manufacturers trying to make good quality smartphones, so the competition has become severe. We’re trying to introduce new technology in the future and diversify our product even more. The quality and strength of the product is always the starting point as far as strategy goes for the company.”
Totoki: Better technology will bring a better customer experience
“In the morning when people wake up, they look at their smartphone. When they go to bed, they look at their smartphone. Smartphones are part of life today and people now have high demands. They prefer a good quality of camera, a good quality of screen, and also good picture and audio quality. These are basic demands that people want now — they want high quality. And it’s in this area that we try to install new technology to give a better user experience, and a better feeling for the customers.”
“Yes, the competition has become severe. The smartphone device consists of a battery and a screen and chips. These are the main parts of a smartphone, and people can easily make them now. But it is the user experience that is not the same. Even if the device is the same, the user experience is different. And this is a very important point. People are not buying a smartphone because of the device and the way it looks — they are buying it because of the experience.”
“Of course we are using a very good quality of image sensor that our colleagues at Sony created. That’s the craftsmanship in technology that we have to install to provide the best user experience. That sort of craftsmanship in technology is very important — it’s key to becoming more than just a mere smartphone. It takes the quality higher, improves the brand image, and the user experience.”
Totoki on wearables
“We’ve got a good feel for the technology and we’re not limited to the smartwatch. We include smart wear, smart products, and smart devices, and there are many more things now being made for the IoT (Internet of Things) era.”
“Those types of devices, and that side of the industry have become huge, and not limited to a smartphone device. Now we try to develop smart devices that are connected to the smartphone. In the future there will be categories of products that will connect to the network, connect machine to machine, connect machine to human, and connect human to human. That sort of connectivity will expand and we will try to develop even more categories in the future. That’s one major focus for this company. It’s a big future strategy.”
Via Arabian Business.