One thing that always confused me is whether it is ‘Sony Ericcsson’
or ‘Sony Ericsson’? Well, it doesn’t matter anymore. Because there will be no
Sony Ericsson mobile phones in the market anymore. The Swedish company Ericsson
has sold its 50 percent stake in Sony Ericsson to Sony for $1.46 billion. The
deal is expected to close in 2012. The move was very much anticipated as the
mobile manufacturer was reeling under recession and declining sales. Now, Sony
Ericsson will become a wholly owned subsidiary of Sony and integrated into Sony’s
platform of network-connected consumer electronics. Single ownership enables
Sony to integrate their smartphones with their consumer electronics products.
You might see an integration of Sony smartphones with PlayStation, tablets,
laptops, televisions and other Sony platforms.
Under the deal, Sony
will gain ownership of five patent families relating to mobile handset
technology and a broad intellectual property cross-licensing agreement.
Industry experts say that the move is going to help Sony Ericsson to become
more competitive in the smartphone market. Sony Ericsson adopted android in
2008 and has 11 percent control over the smartphone market worldwide. In the 11
percent, Xperia smartphones account for 80 percent sales.
The shareholders of
both the companies have taken the deal positively. Ericsson shares went up by
5.1% and Sony stock rose by 5.4%. The move will now enable Ericsson to focus on
its core wireless equipment business. Ericsson and Sony started the joint
venture ten years ago on 1 October 2001 combining their expertise in respective
fields. The venture was a huge success in the beginning but fell short in the
competition with smartphone manufacturers like Samsung and Apple.
Now, what can we
expect? I think we will get to see far better smartphones from Sony, which will
be integrated with their other platforms. Sony has pulled their socks up and
decided to give it a fight. Sony is going to come out with all guns firing and
they have decided to stop the production of normal 3G phones by 2012 and focus
entirely on smartphones.
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