Sony targets ‘splitting out’ of video and sound business unit

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Sony Corporation held its ‘Corporate Strategy Meeting’ February 18 and unveiled a mid-term strategy that charts the path forward for the Company over the next three years, including the splitting out of its video and sound unit in October.

As part of its target to ‘realize its transformation into a highly profitable enterprise’, Sony has outlined its intention to focus on ‘business management that emphasizes profitability, without necessarily pursuing volume’, ‘business management that grants each business unit greater autonomy and mandates a focus on shareholder value’ and ‘clearly defined positioning of each business within a broader business portfolio perspective’.

This will include a focus on the profitable sectors of devices, game and network services (its PlayStation offering), pictures, and music as the segments that will drive its profit growth over the next three years, the company says.

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The corporate strategy also includes a move towards stable profit generators. It said: ‘As businesses capable of contributing stable profit, Sony will prioritize the generation of steady profit and positive cash flow for imaging products and solutions and video and sound. While Sony does not anticipate overall market growth in these areas, the Company will target certain areas within each market that are unlikely to experience commoditization by continuing to offer new, high value-added products such as its advanced mirrorless single-lens reflex cameras and high-resolution audio products. By capitalizing on its existing technological expertise in these areas rather than engaging in large-scale investments, and by optimizing fixed costs and enhancing inventory control, Sony will aim to maximize profits and return on investment.’

There will also be further management structure changes, a year on from the split out of its TV business. Sony says it is targeting October 1 2015 to commence the next stage of this reorganization process by splitting out the Video & Sound business unit and launching it as a self-sustained, wholly owned subsidiary. Sony believes this will allow for faster decision making and greater accountability and transparency.

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