Home / Tech News / Electronics companies in Japan are starting to turn themselves around, but they are a shadow of their former selves (Economist)

Electronics companies in Japan are starting to turn themselves around, but they are a shadow of their former selves (Economist)

FOR Sony it was a bittersweet moment. On July 1st the firm bid a final farewell to its Vaio personal computers, a global brand which won such a devoted following after its launch in 1996 that the late Steve Jobs, a fan of Sony in its glory days, once asked to equip it with his Apple Mac operating system. Cut off from its parent, Vaio is floundering. Since Sony announced its sale to a Japanese private-equity fund, in February, it has suffered a slump in its market share in Japan to just 2%, down from 10% at the start of 2014. The vertiginous drop will have dismayed Sony, which had kept a tiny stake in the business. However, investors have put Sony’s bosses under pressure to do something about the company’s chronically poor performance. It has lost money in five of the past six years and is forecasting a further loss in the year to March 2015. Vaio is the most significant business Sony has quit in recent times. Cutting it adrift may be the start of a far-reaching reorganisation. On the same day the firm shifted its loss-making televisions arm, once the core of its profits and brand image, into a separate legal entity. For now, Sony’s chief executive, Kazuo Hirai, rules out an outright sale, and many people criticise him for not acting more drastically. Yet the firm admits that an alliance with another television-maker could be an option. After years of denial that surgery was needed, optimism is rising that Japan’s consumer-electronics firms are facing up to their steady loss of global market share (see chart 1). In 1982 we published a briefing on how “The giants in Japanese electronics” were set to keep conquering the world with all manner of exciting new gadgets: Video cameras! Fax machines! CD players! And they did, for a while

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Electronics companies in Japan are starting to turn themselves around, but they are a shadow of their former selves (Economist)

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