Feeling Heat, Sony Drops 1,000 Employees As Mobile Division Leaves Sweden
August 23, 2012

Feeling Heat, Sony Drops 1,000 Employees As Mobile Division Leaves Sweden

John Neumann for redOrbit.com - Your Universe Online

As financial results continue their slide into disappointment, Sony Mobile Communications division, currently headquartered in Lund, Sweden, has announced that it will relocate its offices to Tokyo before the year is over in a move that will see 1,000 jobs eliminated at the once-thriving flagship of the Sony empire.

The move back to Japan will, according to a Sony statement, “Enhance operational and development capabilities of Sony Mobile such as time to market efficiency, streamline supply chain management and drive greater integration with the wider Sony group.”

The relocation occurs after Sony Mobile shut down its partnership with the Swedish firm Ericsson last year, reports The Inquirer´s Carly Page. As part of the restructuring, Sony Mobile hints at further cost-saving measures to come as sites and operations are “redefined.” Further details were not forthcoming.

Sony took full control of Sony Mobile with Ericsson in February of this year in hopes of shoring up control of the mobile division when the business was losing ground to Samsung, other Android handset makers, and Apple in the overall smartphone space.

The company has enforced its smartphone commitment to its Xperia brand of devices, but it is fighting against the tide of what is basically a market of Samsung and Apple, with everyone else fighting for a shrinking third-place.

At the end of last year, it was estimated that Sony´s Xperia phones made up 12-percent of all Android phones sold with Samsung enjoying a 41-percent share, reports TG Daily´s Emma Woollacott. Gartner notes however that in Q2 Samsung made up more than half of all Android devices sold, concentrating its lead.

Kunimasa Suzuki, president and CEO of Sony Mobile was quoted as saying: “Sony has identified the mobile business as one of its core businesses and the Xperia smartphone portfolio continues to gain momentum with customers and consumers worldwide.”

“We are accelerating the integration and convergence with the wider Sony group to continue enhancing our offerings, and a more focused and efficient operational structure will help to reduce Sony Mobile´s costs, enhance time to market efficiency and bring the business back to a place of strength.”

These brave-faced comments comes at the same time parent company Sony Corporation is enduring difficult results, posting a $312-million loss for its quarterly earnings.

Ericsson, which became Sony Ericsson, once enjoyed being one of the world´s biggest and most innovative handset makers as early adopters of touchscreen technology in the smartphone space. Sony´s P800 was one of the very first touchscreen devices to hit the market 10-years ago.

One lesson we can take away from the once-proud tech innovator is that past success is just that, in the past. The future market-shapers belong to the innovative and bold.