Robots were once an emblem of Sony’s technological prowess. But now the electronics giant is putting its robodog to sleep and firing its “ambassador” humanoid in a bid to return to financial health.
Sony, which has been struggling in the face of stiff competition at home and abroad, announced it would stop making entertainment robots just as it reported record profit for the December quarter in a sign of a possible turnaround.
A day after saying the Walkman, the iconic gadget launched in 1979, will no longer be made in Japan as production shifts to China and Malaysia, Sony said on Thursday it will stop producing the Aibo robodog at the end of March.
The Sony group has sold 150 000 of the beagle-looking high-tech pets since its debut in 1999. The latest line costs roughly $1 700 a dog.
Sony will also stop developing its two-legged, 60cm “ambassador” robot, which was first unveiled in 2000 and was rechristened in October 2003 as QRIO after the phrase “quest for curiosity”.
QRIO, which the company has described as the “Sony Dream Robot” to promote the brand, is Japan’s highest-profile humanoid along with Honda Motor’s walking and talking Asimo although neither is for sale to consumers.
Sony said it was refocusing and would use the artificial intelligence technology gained from the robots in its core business.
The robots were “a brand of Sony, a poster product appealing to consumers”, said Mitsuhiro Osawa, analyst at Mizuho Investors Securities.
“We may miss them, as they have made consumers sense the cutting edge of technology which cannot be seen in daily-use household appliances,” he said.
“The stock market is feeling differently, though. Investors are convinced that [Sony] is serious enough to push ahead with restructuring.”
Sony’s surprisingly strong results heartened investors on Friday, helping the key Nikkei-225 index of the Tokyo Stock Exchange post its biggest gain in nearly four years. Sony shares jumped 14,2% to 5 800.
Last September, Howard Stringer, a Welsh-born former television journalist who is Sony’s first foreign boss in its six-decade history, announced a major overhaul of the business including 10 000 job cuts by March 2008.
Sony said last week its restructuring programme was on schedule, confirming that it will have cut 4 500 employees and closed down seven plants by the end of March out of a plan to sell or close 11 plants by 2008.
Howard’s predecessor Nobuyuki Idei had mused about networking personal computers, television and game consoles in future homes.
“There are moves to turn around from that path towards something like Matsushita,” Osawa said, pointing to rival Matsushita Electric Industrial, the maker of the Panasonic brand reputed for a no-nonsense way of business.
“They are returning to a realistic approach,” he said.
Kazumasa Hirose, analyst at Tokai Tokyo Research Centre, said Sony had “no room” for operations that were unlikely to contribute to immediate profit.
“I think they dropped the operations as employees question why the group is maintaining them” at a time it is cutting payrolls and closing down plants, he said.
Sony will also shut down domestic production and sales of navigation systems and other car equipment at the end of March, and eventually cease those of the Qualia brand of high-end consumer products.
It will withdraw from development and production of plasma-display television by itself while focusing on cathode-ray tubes manufactured in other Asian nations.
The withdrawal from the entertainment robots sector is “no blow” to Sony’s business operations as its top priority should be a comeback in selling televisions, Hirose said.
Sony dominated the television market in the late 1990s with its popular “WEGA” cathode-ray tube televisions.
But the firm failed to shift its television business to next-generation flat-screen televisions while rivals such as Matsushita, Sharp and South Korea’s Samsung overtook it in the lucrative market.
Sony joined hands with Samsung, the arch-rival to Japanese companies, in making liquid crystal displays for flat-screen televisions in 2004.
“The next thing Sony should do is to boost profitability in electronic components and semiconductors,” Hirose said.
Sony is to use its Cell processor in the PlayStation 3, expected to make its debut early this year to succeed the hugely successful PlayStation 2 video game console.
Sony attributed its stronger than expected profit in the quarter to December to robust shipments of core items such as its Bravia brand of liquid crystal display TVs, along with its games business.
Analysts said the third quarter results showed that Sony was starting to turn around from a long slump.
“We can say Sony is on a steady recovery track,” said Kazuharu Miura, an analyst in the information technology sector at the Daiwa Institute of Research. – AFP