Since 1997, Sony has been selling desktops, laptops and notebooks under the VAIO brand of computers. The company met with some early success during the PC boom of the early 2000s, but the company's line of PCs have been met with slumping sales thanks to the rise of tablets and smartphones.
Now, Sony could try to reinvent the VAIO brand for a new era of personal computing, or it could just sell the division and focus on other products. It has chosen the latter.
Sony announced this morning that it intends to sell its VAIO PC business to Japan Industrial Partners this year. Sony says selling its PC business was the "optimal solution" as it allows the company to put more of its resources towards its smartphone and tablet lineup.
So, what happens to Sony's current lineup of PCs? The company says its expects the sale to go through in March, and that it will discontinue all manufacturing and sales after this time. At that time, the Japan Industrial Partners will create a new PC company that will service the consumer and enterprise industries exclusively in Japan, but expansion is not ruled out at this time.
As for the employees working on its VAIO products, Sony says 250 to 300 will be transferred to the new company being founded by Japan Industrial Partners. The rest will either be reassigned to elsewhere in Sony or be offered an early retirement package.
Sony also announced that it would be spinning off its TV business into a wholly owned subsidiary. The company notes that its TV business is still losing money and doesn't expect a return to profitability this fiscal year. It does, however, believe that its reductions and restructuring has put its TV business back on track for a comeback in the future.
To achieve this miracle comeback, Sony has three strategies in place. For starters, the aforementioned spin off will allow Sony to "transform this business into a more efficient and dynamic organization, optimized in size and structure for the current competitive business environment." Second, it will focus on high-end 4K TVs for mature markets and lower end sets for emerging markets that are "tailored to specific needs." Third, Sony will continue to "accelerate and broaden its on-going cost reduction and operational improvement measures."
With these latest moves, Sony can continue to focus on its most profitable businesses - like PlayStation and home electronics. Selling its PC business was probably the right move as its unlikely to pick up again in the future. As for its TV business, spinning it off into its own subsidiary should help the division to remain nimble in the face of any future shakeups.
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