They won’t ever desert you
After a brutal financial year in 2014, rumors ran wild that Sony was thinking of selling its smartphone arm and exiting the business of making phones to cut costs. Even up till now, there are still persistent rumors that Sony is looking to unload its unprofitable smartphone arm and stop making phones entirely.
Apparently, that’s not true. Sony Mobile CEO Hiroki Totoki quashed these rumors once and for all during an interview with Arabian Business, saying that they won’t ever be exiting the smartphone business, and that the company is committed in making mobile devices.
Smartphones are completely connected to other devices, also connected to people’s lives — deeply. And the opportunity for diversification is huge. We’re heading to the IoT (Internet of Things) era and have to produce a number of new categories of products in this world, otherwise we could lose out on a very important business domain. In that sense we will never ever sell or exit from the current mobile business.
He also took the opportunity to address why those rumors started floating around in the first place.
The speculations arose because in 2014 we made a huge loss as a mobile business. It mainly came from the write-off of the goodwill of our impairment asset. When we bought back Ericsson’s share [in 2012], we bought back 100 percent of it. And obviously that price was high. We had to write it down and it made a substantial loss for the company. But this was an accounting loss and did not impact our cash flow. Our cash flow is very healthy. But the accounting loss was so huge — that’s why people have speculated like this. Before that rumour, we exited the VAIO business, which was the PC business. That led people to think that Sony would exit the smartphone business, as well. But the smartphone business is very different from PCs.
That’s good news for Sony faithful. There’s a reason why Sony has a cult following in the Philippines and around the world – their devices are solid, well engineered and usually last longer than the competition. We’re hoping that 2014 was a small bump in the road and that the company recovers quickly and starts making awesome phones again.