ReadWriteWeb DeathWatch: Sony

Sony has posted losses for four consecutive years, and the company has lost its leadership position in just about every market it used to dominate. Can Sony’s new rock star CEO refocus the company before Apple, Microsoft and Samsung devour everything it has left?

The Basics

Remember the Walkman? The CD? The CD Walkman? Sony created (and co-created) all of them, along with the Trinitron TV, Blu-Ray discs, the PlayStation and dozens of other consumer electronics devices that helped create our modern world. But over the last few years, others have captured Sony’s traditional markets, while very little Sony innovation has made an impact. The result is a bloated workforce, unsold inventory and a stock that’s down more than 90% from its all-time high in 2000.

The Problems

Sony lacks focus. It’s not unusual for large Asian corporations to do a bit of everything (Samsung builds dump trucks and Yamaha makes golf clubs), but Sony’s product line is particularly aging and messy. Because it has tried to do too much for too long, Sony hasn’t done anything particularly well. As the company’s new CEO put it: “It’s one issue after another. I feel like ‘Holy s***, now what?’”

Consumer electronics used to be Sony’s cash cow, but now it’s more of an expensive hobby. Sony’s VAIO line of PCs no longer commands a premium. Improving phone cameras have eroded point-and-shoot camera sales, and Sony’s SLRs have barely dented the market. Sony’s eReader charge died long ago.

But the biggest devastation has come in TVs. While Sony packed its spendy sets with features like Google TV, Samsung made a less expensive, more reliable product that still included the things (like Netflix and Pandora) that customers really wanted. Earlier this year, Sony admitted defeat, hacking its ambitious plan to produce 40 million TV sets per year by 50%.

Gaming also hasn’t gone well. The company that pushed Sega out of the console business has fallen on hard times. The PS Vita handheld has been a flop, even in Japan, where the previous generation PSP continues to outsell it even as tablet and smartphone gaming threatens the entire category. The PlayStation 3, Sony’s gaming bread and butter, is aging poorly. Despite a giant pavilion at the recent Electronic