Tech 2

How Sony Lost Its Way

Gizmondo is running an interesting article about how Sony has been on the wrong track lately. Looking back at old blog posts over the years, I find this this piece says a lot of the same things I have been thinking about. Its a pretty good read overall, and I suggest checking it out. Some excerpts from the article:

On Proprietary Formats

Sony’s last huge format hit was a product called “Compact Disc”. You might have heard of it. Spinning plastic wheel with pits in the bottom? Read by lasers? Co-developed with Philips?

It took a couple of years for CDs to take hold, but once they did, Sony raked in the cash. Not only by selling players, but by manufacturing CDs for themselves and others. It’s a huge part of their business even today, as Sony DADC produces not just CDs, but DVDs, Blu-ray, and PlayStation discs in facilities around the world.

Sony became spoiled. For decades, a success in a new media format meant that Sony could expect to make money selling the media itself. Through the ’80s and ’90s, they became less inclined to share the market. Sony developed the 3.5-inch floppy disc drive for computers which found wide adoption as blank discs were available from a variety of manufacturers. MiniDisc followed, but with less success. In 1998 as the flash memory market started to warm up, Sony introduced Memory Stick, what eventually became an entire family of expensive flash memory formats that were not compatible with devices from any other manufacturers.

And don’t forget the Blu-ray vs. HD-DVD war. Sony eventually won that one, but the battle continued for such a long time because neither consortium wanted to lose the market to produce media for consumers—consumers who were increasingly getting their content online.

See the problem? Time and again, Sony took an excellently engineered solution and held it tightly, the better to extract big profits. But every generation, every iteration, Sony’s need to control the format became more and more of a liability. Even loyal Sony customers could tell the proprietary formats were a screw job, eroding their happiness with their Sony product every time they had to shell out a premium to buy a Sony-authorized blank.

On Sony’s Arrogance:

There’s no better example of the arrogance of the modern Sony than the launch of the PlayStation 3. It was the last of the current generation of game consoles to market. It cost more than all its competitors. Kaz Hirai, then president and CEO of Sony Computer Entertainment America and now the head of the entire ball of wax worldwide, said infamously, “The next generation doesn’t start until we say it does.”

People were rolling their eyes at Sony even as Hirai and his executive team made those lofty statements—but our eyes flipped all the way into the backs of our skulls after Sony spent the next three years struggling in a videogame market they once dominated.

Why Sony would present this cocky face to the world is impossible to understand, until you realize that it’s the sort of self-delusional bluster, pre-game trash talk, from a team that hasn’t won a championship in years.

It’s clear in their marketing and press relations, too. Sony is always quick to throw a big party, launch some laptop with a silly event like a fashion show, or hand press review units out to lifestyle magazines but not technical publications. Having had one accidental lifestyle product success with the Walkman, Sony mistakenly believes that its products are stylish—when in fact the Walkman became a style icon despite its often garish or pedestrian looks.