Ailing Sony to Spin Off Audio and Video Business

In speaking to investors last week, Sony has announced that it will be making changes to return the ailing electronics giant to profitability. Changes in the three year plan include spinning off Sony’s audio and video business into a wholly owned subsidiary. Additionally, Sony mentioned the possibility of selling off their smartphone and television business entirely, but clarified that there are no plans for that move just yet.

With spinning off these properties, Sony is left with a core business that focuses on their far more profitable products: Gaming, entertainment, and image sensors.

The moves are an effort to help Sony return to profitability, and their projections are ambitious. CEO Kazuo Hirai projects “a 25 fold increase in profit over three years,” adding that the spinoffs will help the company grow to see annual profits of 500 billion yen by the end of 2018, vastly improving over the 20 billion yen Sony hopes to hit by March of this year.

While these moves are a departure from Hirai’s vision of “One Sony” he put forth upon being appointed CEO in 2012, the projections are promising. The focus on image sensors is a direct result of Sony’s Devices segment performing incredibly well, particularly over the last three quarters. The Devices segment is responsible for the creation of CMOS sensors for mobile devices.  Mobile shooters of the Apple, LG and Samsung variety should be able to breath a collective sigh of relief, as Sony's fine sensors should continue to help these devices perform.

Sony's technology in the area of mobile imaging has been some of the strongest for quite some time. As Sony puts it:

“Stacked CMOS image sensors deliver superior image quality and advanced functionality in a compact size. Demand for these image sensors is anticipated to further increase, particularly within the expanding market for mobile devices such as smartphones and tablets. Sony is striving to bolster its production capacity for stacked CMOS image sensors and further strengthen its integrated supply operations in order to reinforce its leading position in the image sensor market.”

So, as they see it, their products are better than the competition, demand is increasing, and Sony will continue to seek to strengthen their position as leader of the mobile image sensor segment. With over three decades in the image sensor business, Sony imaging should have a bright future, even as other parts of the company work to regain their foothold in the industry.

Russ Fairley
Russ Fairley
Russ Fairley is a producer, editor and motion graphic designer. He also writes for Videomaker and several other publications.

Related Content