The smartphone industry at present is one of the most competitive spaces to be working in, with several heavy weights who have already vanished, like Nokia and then there's Sony which has been struggling to stay relevant in this space even though they pioneered most of the camera sensors used in today's smartphones.
So, what went wrong for Sony? The company was just never able to capitalize on its brand cache. Sony just turned a blind eye to the growing competition in the entry-level and mid-range segment where it was always more about pricing than premium features like water-proofing. Then there's the decade long corporate re-structuring that's been underway.
"We will continue with the business as long as we are on track with the scenario of breaking even next year onwards," Kazuo Hirai, Sony Corporation CEO said to reporters. "Otherwise, we haven't eliminated the consideration of alternative options."
The company has already sold off its Vaio PC division, and the next hatchet is going to be on the Mobile division. It not that Sony makes bad phones, its just that even within its own line-up the company isn't offering anything unique. With the Xperia Z5 Premium, Sony pegged its hope on delivering high-end camera performance with the new sensor and a 4K display to prove itself as the industry leader. But the competition isn't lagging behind, there is innovation in the mid-range segment where Sony clearly lacks. Furthermore, Sony hasn't tapped into several upcoming markets where the likes of Xiaomi and other Chinese manufacturers seem to be thriving.
Maybe its time for Sony to cut its losses and give up on its mobile division. Going forward, margins are going to be thinner in this space, profits will shrink and the company would keep losing money with its R&D. But there is one way Sony's Mobile Division can be saved, reducing the number of smartphones launched to just a few models. This shorter portfolio will give Sony space to breathe and establish itself as a premium smartphone manufacturer rather than fighting it out in the entry-level, mid-range segments.
