Which manufacturer will be Sony’s mobile business partner?

Kazuo Hirai, CEO of Sony
 Hirai Kazuo, the president of Sony Corporation, revealed that “Sony will consider collaboration with other companies” in its TV and mobile & communication businesses.
 Although there has been gossip that “Sony will sell its Mobile & Communication business sometime, won’t it?”, we still felt surprised hearing President Hirai himself clearly say “Sony will consider collaborations with other companies”. Ostensibly, he said “we have no specific plans”, however his talk at this phase may be intended to soften the impact by giving notice instead of surprising the world with a sudden release.

 What interests me here is that if the collaboration is true, what kind of company would be appropriate?
 At first, I thought of Xiaomi, a Chinese manufacturer. There is no doubt that it is the manufacturer with the biggest momentum even when seen worldwide. This would be a good combination for Sony not only in China, but also for exploring the worldwide market. However, Sony may view Xiaomi as a presence for which Sony must keep an eye out as its brands and patents maybe cleaned out.

 In this regard, a Japanese manufacturer may become a mutually trusted partner for Sony. What first struck my mind among Japanese manufacturers was Sharp. I could not help thinking of Sharp. The synergy effect in the aspect of development would be expected if they collaborated collectively including the TV and Mobile & Communication businesses.

 Both Sony and Sharp are going to develop TVs and Android, in addition to smart phones. These two companies would be a good match if development efficiency is given priority. However, in terms of the sales aspect, they are in a significant rival relationship with “BRAVIA” and “AQUOS”. Of course, the same relationship exists in the smart phone market with “Xperia” and “AQUOS”. Mutually encroaching may be more likely to occur than synergy. It is very subtle if Sharp is willing to collaborate with Sony. 

 The other possible partner is KYOCERA.
 KYOCERA is quietly performing overseas expansion. However, its brand power is really weak. Although it finally launched the brand “TORQUE”, its recognition is very low. In this regard, it can be expected to have a complementary relationship with “Xperia” that has brand power.
 Also, KYOCERA has strength of manufacturing at a low cost. Mutually encroaching will be less likely to occur between KYOCERA and Xperia which aims for a high price range with a premium brand.

 It contributes to the operation if Xperia can be manufactured at a low price by KYOCERA while being sold with its brand power.
 In addition, KYOCERA has been supplying products to four carriers in the U.S., and on the other hand, Sony is not succeeding in America. Sony is strong in Europe, while KYOCERA has just entered the European market recently.

 Seen in this light, I cannot help feeling these two companies are in a complementary relationship both in the manufacturing & development aspect and the sales aspect.
 The day after the Sony management policy briefing session, as I had an opportunity to meet the cadres of KYOCERA, I directly asked “Will you collaborate with Sony?” and was answered with “the other party’s scale is too big”.

 Indeed, Sony is estimated to have sales of about 1 trillion yen in FY2017 in the mobile communication area. On the other hand, KYOCERA is only about 180 billion yen in the Telecommunications Equipment Group. In this light, KYOCERA is unlikely to become a partner. On the other hand, a perspective is also likely that if Sony reduces its scale the possibility will not be zero.
 In all cases, Sony Mobile has been overtaken by a situation where it has to be prudent and cannot afford failure. If its plan cannot be achieved, it seems to have to face the next step, either “Collaboration” Or “Sale”.

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