Sony on brink of upheaval as analysts back British chief

So it looks like Sony might be in for some rough times, Analysts are predicting a complete restructuring of the entire company with many divisions being completely cut.

[Nathan Drake]

How's about you use the full original title ;) ?

[Parapraxis]

http://www.thestreet.com/st...
lol

[Bird Dawg]

You are about to lose your job Nathan.

[Israfel]

I certainly feel like SCE has been making stupid decisions, especially regarding European prospects. I really hope the Restructure the gaming division. And put in people, that actually have an Eye for business.

[Bird Dawg]

A restructuring is a must, and it's also a big red flag. When a company is forced to abandon the things that made their legacy is never a good sign. I don't know their plan, but the fate of the current Playstation brands are likely in the hands of Microsoft and Nintendo. A few chess moves and it could be checkmate for every Playstation brand platform on the market.

[TrustyBrew]

get ready to avoid 3 stories from separate amateur websites claiming this a conspiracy, and or not true.

On topic, something about the ps3 will be on the chopping block. There are alot more hdtv,movie goers, and blu-ray owners than ps3 owners. Sales for the playstation brand are down across the board. I just wonder what it will be, a hardware revision, loss of exclusives and 3rd party support, or just canning the ps3 all together?

[gaffyh]

Lol at the doom and gloom article. I seriously doubt things are as bad as these guys are making out.

[godofthunder10]

I have a 360 and i wouldn't trade it for a ps3 for anything.The fact is that sony wont drop the ps3,i'll admitt it because it's the truth.I'm not a childish fanboy.

Fact is fact.Some ps3 fanboys are saying that the ps3 sold more then the 360 did in the first year they both came out.The truth is that they are right.On the other hand the 360 sales been picking up big time and the ps3 droped off a little.

Some ps3 fanboys are saying that the ps3 is selling more software in some countries then the 360 and they might be right i don't know.The fact is that overall sells count not just 1 or 2 countries.the fact is that over all the 360 is selling a lot more software then sony and nintendo.The ps3 comes in 2nd and the wii comes in last in software sells and this is fact.

Some ps3 fanboys are saying that the ps3 is really selling more then the 360 and it's not true.The fact is that sony is loseing a lot more money then microsoft ever lost on the 360 on each sell.If it wasn't for the ps2 selling like it is they wouldn't be a ps3 today and that's a fact.Ps3 fanboys don't want to admitt it but the ps3 is doing the worse out of the 3 and that's a fact.

[gw4k]

Is in serious trouble. With Sony going in the red and their games not selling well, a lot of money is being lost.

MS 360 is looking better and better!

[liquidsnake]

Full of BS. People seems to not understand what the hell they are talking about. First of all, the Playstation division is making money. The PS division is also the most profitable devision of Sony so I have a hard time seeing that they will can this all together. Second, Sony does not contain only of the PS division, they are involved in movies, music, telephones, cameras, TV's you name it. Has anyone ever thought that perhaps any of these companies, like columbia pictures is getting canned? No you haven't.

[BoBo33]

Like someone mentioned above, there are alot more hdtv owners, and movie goers than PS3 owners. I doubt they will touch those divisions. I would say their camera and playstation divisions will take the brunt of this restructuring. The PS3 would seem like a likely target, due to it's smaller install base and the fact that it isn't profitable.

[Mozilla89]

Whatever makes Sony more efficient and ruthless. Communication between Sony's different branches is non existent. Like Sony Pictures made movies appearing on Live and not on the PSN and crap like that. They obviously didn't handle the launch of the PS3 very well either.

But if you think that they're gonna abandon the PS3 you're wrong. Launching a console is a huge investment and it would be a waste to just stop supporting it. Its not like the gaming division is killing them anyways. Saying that Sony won't make another console (they will just not soon) would make more sense than saying they'll stop supporting the PS3.

[acedoh]

and totally misinterpret it. It's unfortunate that the poor economy will probably have a determental effect on companies like SONY. Although trying to act like they are going to let their gaming division go shows ignorance. The Playstation division is one of the most succesful divisons for SONY. If they were in a desperate situation we have already seen a price drop which is always a sign of a console failing. SONY is banking on 2009 being a great year for the Playstation brand. SONY has invested a lot into some major games. Despite high profile games like Resistance 2 and Little Big Planet not exploding with sales does not mean they are not profitable. Although game development is more expensive than it was in the past it can still me more profitable that other entertainment divsions... I think this is only the beginning for the PS3

[fenix1300]

how everyone and their grandmother thinks they know whats best for sony!!!! has anyone ever stopped to think and asked themselves how they know better than Multi billion dollar company which can hire enough analysts to decided whats good or bad for them?!?!?

[acedoh]

http://en.wikipedia.org/wik...

The criticism of Pete Carroll became louder when Carroll's first USC team opened the 2001 season going 2–5, with some sportswriters writing off the once-dominant Trojans, who were the only Pac-10 football team to never finish in the national top 10 during the previous decade, as a dying program.[21][16] However, after the slow start, Carroll's teams proceeded to go 67–7 over the next 74 games, winning two national championships and bringing USC back to college football prominence.

So I can only think that naysayers are not always correct...

[Saint Sony]

PS3 could have been great, but Sony made so many mistakes in so many levels that it's doomed now and current situation of the world economy does not help at all...

Well, there's always other choices for gamers.

[Marty8370]

Most companies restructure from time to time. Getting rid of old production lines too make way for new lines/expansion, eg VHS to DVD/Blu-ray.

[GiantEnemyLobster]

Sorry droids, but the cell isn't any good when the PS3 is dead.

[DragonSoul]

Why do people still think the PS3 is going somewhere?

[happyface]

Sony has completely fallen apart it seems

ps3 needs to start doing a lot better or else the money counters over at sony may decide enough is enough

NEWSFLASH disagrees: this article is by the LONDON FKING TIMES, this isn't a fanboy blog

[xwabbit]

Y does it need to be doing a lot better, im sorry but i have to say that you are one of those people who dk about the history of hardware sales. Xbox had 13mil in 23 months while PS3 got 17 mil in 23 months so ? How can it be doing bad ? Its even selling more software than xbox is in many companies and u don't have to take my word for it. Google it and you'll see it.

[GrandTheftZamboni]

...oh, wait...

[ultimolu]

Maybe they should put you in charge...since Sony is on the verge of collasping. You could probably save it from teh impending doom and gloomz.

[ultimolu]

First of all, know your damn facts. Sony did not lay off 15,000 people...from what I read. They laid off 8,000 workers. I wish I could use a capitalization thing here but I can't so let me point to an article.

http://www.belfasttelegraph...

They could lay off more because of the economic turndown but let's just see what happens.

Second of all, this article is reiterating what the other articles JUST MENTIONED about Sony's restructuring plans. This is not new. People know about this already and there HAS been some restructuring going on.

http://www.reuters.com/arti...

This was reported on December 9, 2008. Your article was late in delivering the news. No one knows which divisions would be cut but I HIGHLY doubt Sony would cut the gaming division, especially when it's being profitable.

360 fans want the PS3 to fail so badly and for Sony to drop out of the gaming industry that they hold on to every single negative thread tightly.

It's basic common sense to see what you people actually want to occur.

And as usual, the cowards bark the loudest as they slam the disagree buttons repeatedly.

[GrandTheftZamboni]

This smells of FUD: the only named analysts talk about what Sony DID and what Sony SHOULD do:

"Koya Tabata, a Credit Suisse analyst, recently warned investors that the restructuring of Sony is perilously overdue and must be radical."
"Deutsche Bank analysts described the restructuring plans as “insufficient in scope and scale”"

Apart from that it's "Company sources" or "many analysts" that tell what Sony WILL do ("job cuts and sweeping changes", "to be announced early next month"). Can we have names?

Anyway the article gives some time frame:

"The restructuring is expected to be unveiled after this month's Consumer Electronics Show in Las Vegas."

Let's wait and see.

[LeonSKennedy4Life]

His new avatar is Hancock.

Do we really have to acknowledge that he still exists? Hancock was, quite possibly, Will Smith's worst movie. It took old premises', unmemorable music, and "meh" special effects...blended them up...and it came out looking like Hancock.

I don't think you should be able to talk anymore.

[GrandTheftZamboni]

Where did you get that Sony lost 15 billion in one quarter? I just checked Wikipedia they say Sony's profit for 2008 is 3.694 Billion.

[Bird Dawg]

The Playstation brand is about to go under. I just wonder if it will immediately be cut, or if it will linger on for a couple more years. I guess it will be up to Nintendo and Microsoft whether or not they want to strike the fatal blow.

[JD_Shadow]

Why would you WANT something like that to happen?

[Bird Dawg]

I didn't say I wanted that to happen. But I'm not a fanboy in denial either. Sony is in trouble. And in their weakened state, Nintendo or Microsoft could end Sony's run in the console war if they chose to do so. It's not want or wish, it's truth.

[hate_me]

in denial much?

[ultimolu]

...PS3 is doomed! :o

This is a combination of mismanagement and the economy itself taking a toll on Sony. I'm pretty sure they're not the ONLY ones going through this.

They just need to get their priorities straight.

[Dannagar]

Japanese Pride... It helped bring Sega Down. They need to let Sir Howard do what's best for the company. Don't worry, It's not their gaming division that's bringing them down, it's every other division. Though Sony looses money off each PS3, sales of PSP's and PS2's make up that money. So they break in even there. For those that want to support Sony, just buy their games. Those numbers count.

There is always the danger that 1st party games that are in development could get the axe due to poor sales of some of their heavy hitters this past Christmas. I'd imagine that's the only thing to worry about.

[ultimolu]

Yeah, the 1st party could be a major concern. Hopefully it doesn't come down to that.

Reorganization would be the step in the right direction so their company could survive this rollercoaster.

But one should never hope for Sony's demise in the gaming industry.

[Death]

It's not in danger though since losses have been reduced to the point they should start to atleast break even and start profitting soon. I'm a little confused by his call to focus on software though. WHile it's nice to have a robust first party, doing so also alienates third party support to a degree. Sony has always produced great products but they lost their way awhile back. The Walkman was the portable to have. Once cassettes died out they never recaptured their market with CD or MP3 players. They don't even have a line of MP3 players as good as the Zune and that's not exactly saying alot when you compare it to ipod sales.

-Death

[Cyber Gamer]

lol hear we go again

[cherrypie]

"here we go again"

Yes. Another top-flight, world-class news outlet tells you that Sony is in deep trouble.

Next thing you know, Wall Street Journal will tell you the PS3 has failed at market.

Sheesh, wow. Now, lets see if we can find some bottom-basement wordpress, blorge or kombo article to tart-up some BS about MS... boy, who wants news from the UK Times when we can publish some 12-year-old's semi-literate rant about how much "MS suxors1!1one!" eh?

I suppose your going to tell us that the UK Times is a part of the vast anti-Sony consipracy with Gametrailers.com, joystiq.com, 1up.com, gamasutra.com and the rest who've told you the same thing?

PS3 has failed at market. Sony is spiralling down the toilet as better competitors over-take it in every market. It's reality. Accept it.

When the December world-wide numbers arrive, this place is going to need therapy.

[Terabo]

The whimpering from N4G's members homemade websites has already started. It will be a full blown day care center here when Dec numbers are released.

[solideagle1]

new article on how Sony is doomed or whatever. this is insane.
thanks

[macalatus]

Cherrypie, calling N4G members a derogatory name like "retarded" is not allowed in the gamerzone.

To all respectable N4G members, please report Cherrypie's comments as offensive! If he replies to this post, please report it as spam as more than likely he would regurgitate the same thing!

@below,
It's still spelled "retarded", so it doesn't change anything.

[McDaygo]

he did say clinically. Like Brick from Anchorman. Loud noises.

[power of Green]

There is simply not enough of us to work on yours:)

As if that is some sort of privilege when you guys abuse/control the system with numbers three or four times greater lol.

[cherrypie]

Gang-mentality censorship.

"Cherrypie, calling N4G members a derogatory name like "retarded" is not allowed in the gamerzone. To all respectable N4G members, please report Cherrypie's comments as offensive!"

Wonderful.

Clearly, I wasnt calling any individual retarded, I was speaking about a world-view that I elaborated.

No matter. No amount of censorship can change the fact that Sony's mistakes have taken the entire company into a death-spiral.

More 1st party PS3 titles will see the axe to save cash.

[Zeevious]

From posting outdated spec. information as current facts to applying one standard to Sony and ignoring that same standard for Microsoft...your lack of credibility invalidates your opinion.

Sony is reported to lay off 8,000 out of 180,500 or 4.4% *

...and this is what you call a Death spiral & "More 1st party PS3 titles will see the axe to save cash." (NO 1st party titles have been reported getting the axe AT ALL)

So if that's a death spiral...by your own logic, how do we apply this to Microsoft?

Microsoft is reported to lay off 17,000 out of 91,000 or 18.7% *

The truth is both are cutting back due to the economy, but if your calling a 4% cutback a death spiral what do you call a cutback almost 5 times greater? Death itself?

I simply can't recognize you as a credible source until you start posting information that has at least a sliver of credibility.

Don't worry. I won't hold my breath.
.

* Employee numbers are as reported by Forbes Financial Services JAN 05, 2009.

[lord_of_balrogs]

So Apple and Nintendo are competitors but MS aren't...........

[Death]

Apple owns the portable MP3 platey market. They are the ones to beat. Nintendo owns the console market with the Wii this gen and the handheld market with the DS. These two are the companies to beat this gen like SOny was the last 2 gens with the Playstation brand. That is why you see so many comparisons with the PS3. It is an achievement to beat the market leader. At the rate things are going next gen it will be the Wii everyone targets for sales goals.

-Death

[Anon1974]

Sony's started a massive restructuring over a year ago and have been implementing it is stages for some time now. This article even refers to it as the "expected restructuring". Must have been a slow news week, this tells us nothing that wasn't known for some time now.

Maybe the Times could also break the big story on the recession while they're at it.

[ultimolu]

Lol, don't you love how the disagree fairies are out on full force too? I remembered this story was first introduced last year. There *has* been some restructuring going on.

They're a bit late.

[frictionini]

fanboy comments are better than some CNN and Whatever London Times that is...

[ThatArtGuy]

Everyone, the article isn't saying the PS3 is doing poorly, it's saying SONY needs restructuring. The gaming division is doing well at Sony right now, I doubt much will be done with it. However, the other divisions... will probably get a lot of tinkering.

[ultimolu]

Dude, give it up man. The gaming division ish doomed! :o

[Chaos Striker]

Finally, it took them long enough to realize that restructuring is absolutely necessary. There has been too many disconnects between the different regional divisions that has caused major issues, especially since one area may feel as though they are dominate over the say of others. I think I remember a quote a while back from Phil Harrison, who said that the Japanese division was the most uncooperative, when he was trying to pitch more casual or creative ideas to the heads their. Now we can only hope that the results of these changes will develop more cooperation between all the different divisions and regions.

**Indeed, its just frustrating to know that many good ideas may have been rejected and not built upon as a result of mismanagement. Hopefully a corporate shakeup with new and fresh people will help with the overall picture.

[ultimolu]

Like I said-mismanagement/economy.

Hopefully whatever they're doing will help them.

[McDaygo]

Have been a leader for many years. I highly doubt the world will crumble under their feet. Not saying they should never worry but just that they too will feel the sting of the current world economy.

[PirateThom]

Sony have been undergoing reorganisation for some time now, but it'll not affect Sony Computer Entertainment.

Likely, it'll be a lot of mergers and closures between local worldwide branches of Sony and downsizing of other research branches.

[OuterHaven]

is Sony gonna die? is it over? Did MS win? Did Blu- Ray suck/fail? Is Times owned by Kotaku? no and no and no...

It is a restructuring thats been going on for a while, no point in bringing this up now. They wont cancel PS3, they are turning profits. And there will be a PS4, b/c it will be beefed up PS3 which will be cheap to produce. Nuff said,

[D3stroy3R]

I myself want the sony brand and the ps3 do well, but as the main hurdle of there obstacle is the pricing of their product and the situation of many family are in with this recession. Like I said, this year has to be termed for sony, "make or break,." I myself have a ps3 and can't wait for future titles that will come out this year, but the dreaded price of this console and lack of marketing to the public is sinking it. The killer titles are comming, but for sony to stand, they must cut price to around 329, or even 299. Although right now they are loosing money with each system sold, and this plan might do worse, it can create demand with so much supply.

[McDaygo]

They're making profits on the PS3 Fo Sho.

[McDaygo]

I'm stoked to see what the OLED brings.

[Killzonegamer83]

Isnt Sony's gaming division one of the most profitable divisions for Sony?! They are making very good profits on the PSP and PS2 consoles on top of blu ray royalties. I doubt they will cut the Gaming branch

[JasonPC360PS3Wii]

The PS2 and PSP is, but the PS3 isn't. If you need to cut a limb, which do you think it will be?

[kosovo]

funny indeed.
how about you change the headline.........
M$ on brink of upheaval as analysts back US chief.
can't we ever hear any other thing apart from Sony haters spamming and annoying the general online population?.

[user3915800]

Tell it like it is Sony sucks and so its the followers of this Bs company full of hypocrites, liars, and corrupted company. The PS3 sucks and so is the blu gay player.And not to live anyone behind, if you follow these liars to hell with you too fanboy. Sorry, but the company sucks just like their barbeque grill.

[GrandTheftZamboni]

http://www.georgeforemancoo...

[PirateThom]

Does this site have any age restrictions?

Are you trying to say Microsoft and Nintendo aren't full of hypocrites and liars?

[GiantEnemyLobster]

http://www.bornrich.org/ima...

[ApocalypseShadow]

which is the demise of sony and ps3.

they know ps3 has momentum.they know the games are looking better and better.they know that third parties have stepped up their game.they know that features that ps3 has is second to none.they know that sony continues to innovate.they know that the system is reliable.they know that game companies are making money on ps3.they know that sony has future unannounced games in the pipeline.it just keeps going.

the fear of the 360 fan is that 360,going into third place,will mean that they get left behind with ports.or losses in games because games are going to made on ps3 first.but they shouldn't worry when 360 hits third.

ps3 ports to 360 will mean that 360 fans can look forward to games that will still look great.it will still mean you will get some exclusive DLC.it will still mean that microsoft will buy some exclusives from third parties.those games may not match ps3 exclusives,but at least you will get something being in third.

they know it's coming.the fear propels them to spread as much FUD in the hope to stop the freight train.i predicted that 360 fans would end the year with "INCREASED FUD" with bullsh!t articles.and that in the new year,they would start anew with fud to stop games like killzone2 from selling consoles like MGS4 did.

you can't stop it.posting parts of titles,taking "ONE" story and making it 10 stories,lowering metacritic user ratings.it just won't work.being armchair quarterbacks means you aren't in the driver seat.sony is.they know what they must do in times like this.some parts of sony will get chopped.some employees will get their walking papers.but sony will live on.your wishes will be unfullfilled.

sucks to be you.

post as much FUD as you want as you exchange out your "fourth" xbox 360 console.

apocalypse...................

[Mitch_Cumstein]

http://www.youtube.com/watc...

[JasonPC360PS3Wii]

The PS3 has momentum by declining?

[SaberEdge]

I think the PS3 is going to do just fine, but its talk like this...about the PS3 being a freight train that is going to crush the 360 that gets you into trouble and makes people oppose you.

[Mitch_Cumstein]

Cut funding for HOME. No one will miss it.

[sparta76]

360 sold 13 million in 23 months.. Playstation 3 sold 17 million in 23 months... So who's in trouble? And 360 came out a year before ps3 and the wii. Ps3 is going against 360 and the wii. And still selling better then 360.. And by the way micosoft are giving pink slips to 17 percent of there workers

[Mitch_Cumstein]

What percentage marketshare did Sony have last generation? What % do they have this generation? Yeah, thats what I thought.

[Anon1974]

Last I checked the PS2 was still the most played console in America (based on Neilson data). PS2 games routinely place in top 10 lists in sales all over the world and Sony is still aggressively marketing the PS2 in new markets. You make it sound like Sony lost that marketshare. They have not. Just look at the revenue for their games division, far above what Nintendo brings in. The Wii and PS3 aren't even in the same league sales wise, and the Nintendo DS is hands down the portable leader - so where do you suppose Sony's impressive revenue stream is coming from?

[Mitch_Cumstein]

wrong place

[kosovo]

@Mitch_Cumstein -
Cut funding for HOME. No one will miss it.
''''''''''''''''''''''''''''' '''''''''''''''''''''''''''''
nope, 'HOME' was not meant for only the ps3, it's meant for all Sony products,
when Home evolves completely Sony as a company would be integrated into it, i can also see that many companies are taking a test with the 'HOME' virtual world.
it takes patience to become a man, Sony didn't emerge as an ELECTRONIC
GIANT in one day.
it is a RISK to take a RISK.
cheers
think B3YOUND!

[sparta76]

And your point is? Told you 360 had a year head start.. Ps3 will catch up. 360 keeps loosing ground. That's why they got the price cut, That's why they giving pink slips to 17 percent of there workers. And when the ps3 drops the price this year what do think is gonna happen?

[evrfighter]

uhhh sorry to burst your bubble. but m$ isn't firing 17% of its workers over a game console. M$ is first and foremost a software company. Their main competitor is Apple not Sony. Their losing marketshare to Apple and had to cut jobs to make up for it.

Only a real douche would try and use that to further a stupid console fanboy argument.

[Jihaad_cpt]

I hope this isn't American Analyst they couldn't do anything to help themselves. Credit Crunch anyone?

[Faztkiller]

@ Grandtheftstreetcar

need a iq test then this site would be alot better because no xbox fanboys would be here

[sparta76]

You my friend are a douche and a a$$. What do you think Sony is my friend. I am just pointing out how micosoft as a company are giving there worker the slips. What you think micro is doing so good when they closing there first party studios?

[evrfighter]

"360 keeps loosing ground. That's why they got the price cut, That's why they giving pink slips to 17 percent of there workers"

come again? Did you read your own comment?

Read your OWN comment again and then read what I wrote above

[DeZimatoR]

Whats more entertaining than the article itself is reading the posts of some low-lifes that are trying to show everyone how the console they own and have fun with has no future and is going to be canned or whatever.

Why are they so desperate for that to happen? Did Sony rape their gramma? Have they become traumatized over the PS1 and PS2 completly destroying their favourite consoles last gen? Is that it, are you bitter?

Damn, thats f*cking sad.

You guys must be going bananas now with Killzone 2 coming up, because you won't be able to play it, and its JUST the type of game you love. It'll hurt you inside when you diss it only because its not on your favourite console.

haha

[Droid Control]

This is looking bad for sony.

Maybe its a good thing though. I mean, if the PS3 isn't selling, it makes se4nse to close some factories. They did similar things before the dreamcast got 'dreamcasted' otherwise they'll fload the market with PS3's that arn't selling.

And when the economy picks up, and hopefully the PS3 is still alive - the sony can continue manufacture...

[Camper]

Sony u should leave console business and leave it to microsoft and nintendo b4 u go bankrupt

[b777conehead]

so because you are a Sony hater. you want to leave the gaming to the wii and the 360. so that would leave you with a choice of a kids console. are a console that breaks at a 33 percent rate. i like having that 3rd choice the ps3 .

[JasonPC360PS3Wii]

At least the 360 and Wii arn't last

[Captain Tuttle]

The mishandling of the PS3 (it's a great machine but has been poorly managed as a product), the deep recession and especially the strong Yen is really binding Sony's hands right now. I don't think they're going anywhere but you will certainly see a slowdown in first party games going into 2010. The budgets for the '09 games were written in '05-early '07 when money was cheap and times were good. I can't imagine they have too much money right now in the budget to fund many future games...this is the danger of 1st Party, exclusive development. Unless you're Nintendo of course and sell a billion consoles a week.

Edit: I should add that I'm speaking primarily of the gaming division.

[dazzalfc]

...aren't Microsoft currently poised to let 15,000 people go and have been constantly restructuring their business? Yet i dont see many news articles on here, and when anyone mentions this, we get the fans of MS ansd Microsoft saying 'well they're more of a software company' like that makes it ok. Last time i checked, Sony had its hand in quite a few other things too.

Face facts people, this is happening everywhere. Whether it be Microsoft, Sony, even at the company i work for, Jaguar or the company i hold shares in, Dixons Group. Sooner some of you kids open your eyes, take the penis out of your favourite console and actually use a small bit of realism and sense, the better.

[Captain Tuttle]

Well it's important because the division that arguably made them the most money in the past (The Gaming Division) is one of their biggest losers right now and has been for the last 2 years. The strong Yen is killing them too. Let's face it, the PS3 isn't exactly doing great in Japan and Sony is primarily an exporting company and Japan's strong currency cuts into Sony's profits.
And you're right, all companies are going through hard times right now and I have no doubt that MS will lay some people off. It's just that analysts aren't talking about MS right now, they're talking about Sony.

And no, it's not a conspiracy.

[TheExodus]

360 is an expensive hobby for MS, but their core business (Windows & Office) isn't collapsing so they can afford to indulge. Sony on the other hand has been getting squeezed out of every segment of the consumer electronics market for nearly 2 decades now. Up until 2 years ago gaming had been an unassailable aerie for Sony in consumer electronics, but that was before consumers turned their backs on PS3 & it's $600 price tag.

Yes, MS is restructuring to save money during tough economic times, but Sony is restructuring to save a company on the verge of collapse.

[Anon1974]

Everyone still acts like the PS2 is a thing of the past but it's really the goose that laid the golden egg. Sony's games division has far more in revenue than Nintendo or Microsoft games brings in. The Wii and PS3 don't even sell in the same league as each other, the Nintendo DS is the champion of portables, how do you guys figure that Sony games division is still bringing
in as many billions as it is? It's because the PS2 is still the most played system in America (probably worldwide as well) PS2 games still are cracking into top 10 lists all the time and Sony is pushing the system into new markets as we speak. Certainly it's not what it used to be but it will still remain a juggernaut for years to come.

Sony has been restructuring for over a year now as they've had to do in the past. I don't see this as being nearly as dire as many would predict. Most analysts are taking the "wait and see" approach to Sony's restructuring because it takes time for these types of changes to have an impact.

[dazzalfc]

@ Exodus

I'm sorry, but i fail to see any company who enters a certain sector 'as a hobby', that'd be extremely bad business as far as i'm concerned, and i certainly hope you don't become a managing director of an important company.

Microsoft entered the video games market because it saw an opportunity to make money, just in the same way Sony did all those years ago and other companies of years gone by. With the Red Ring of Death costing the company upwards of $1billion, its investments in 'buying' 3rd party support ala GTA IV, i'd say it was less of a 'hobby' and more of a 'wanting to seize the market and gain support', as support, whether now or in the future, will give profit.

Sony are in trouble, yes, just like Microsoft are and many thousands of companies globally. If they weren't, they wouldn't look to letting staff go and re-shuffling finances to suit the companies debts and wave the current recession tide. And yes, Microsoft aren't safe from the ol' recession either. Given that there market share in operating systems, Internet Explorer and Office have dived in the past decade (and yes, they have, by a small percentage, but remember, Microsoft is a huge company, and even a 5% shift in market share can really damage the companies revenue), and if they can afford to 'indulge' as you put it, then why plan to let 15,000 members of its staff go? Surely, if your business is booming, you would need more stadd, no? I won't even talk about the failure of the Zune, even though it is a good portable device.

Face it people, what is happening to Sony is only whats happening to the rest of the world at the minute. Those who say otherwise are just wanting, for some very bizarre reason, for the Playstation 3 to fail. Those that do really want to get a grip of themselves and probably get a real life. If a company like Sony was to ever drop out of the video game industry rather suddenly, then it would be a dark day for the whole industry, just as it would if Microsoft or Nintendo where to suddenly drop out. Surely as gamers, you'd want the best for gaming, and the best for gamers would be for more competition, to help improve games and give us more great experiences in gaming.

I'll probably get a disagree or two now because i didn't say any console 'sucked' or 'teh 360 iz da bezt conzole eva!!1!' but whatever, you pricks that do deserve to have a limited life and I.Q (no offence to those who disagree with me for valid reasons)

[Anon1974]

...the whole hardware experiment was a bit of a side project for Microsoft that has yet to make them any money. Just like their little adventure with WebTV which wasn't profitable and went to the wayside. Eventually MS (and their shareholders) need to make money. So far making 400 million each fiscal year, there isn't going to be time to recoup the 3 billion lost before the 360 is due to be replaced. Do they just start down the R&D road again with the 720 and spend a few more billion and hope that this time, after a decade of loss, this time will be different or do they shift their focus, try something new? Or, like the WebTV, is it time to just scrap it and focus efforts elsewhere?

[cow moolester]

The Playstation brand is one of Sony's biggest brands and the Playstation division as a whole is still profitable so if any of you think they will axe the Ps3 then you're sadly mistaken

[Marty8370]

Just look where Microsofts 10,000+ job cuts are coming from. They have a smaller workforce of 90,000 and some of the cuts are in the games division as well.

Sony has over 180,000 workforce, so 15,000 don't seem that many. Games division is'nt affected.

7,000 job cuts were from 1 factory in france shutting that produced blank VHS tapes, which clearly had run it course. The market has moved on to DVD/Blu-rays, who the hell buys blank VHS tapes.
.

[Oner]

@ Marty ~ "Just look where Microsofts 10,000+ job cuts are coming from. They have a smaller workforce of 90,000 and some of the cuts are in the games division as well.

Sony has over 180,000 workforce, so 15,000 don't seem that many. Games division is'nt affected.

7,000 job cuts were from 1 factory in france shutting that produced blank VHS tapes, which clearly had run it course. The market has moved on to DVD/Blu-rays, who the hell buys blank VHS tapes."

You won't see "certain types" commenting on that bit of factual information...I wonder why ;)

[MaximusPrime]

every companies are affected. not just Sony.

This is global economic crisis

[Darkseider]

The PS3 is going nowhere but up and for anyone to think otherwise is a fool. Sony as a whole has already announced job cuts and restructuring so "further restructuring" is a redundant, kinda like "more better". Sony's stock has been doing well and its' rating actually went up over the past two weeks. Now please get a grip on reality.

[TheExodus]

Sony's stock isn't up because of the 16,000 job cuts previously announced, stock price rises & fall based on where the market believes a company is heading 6 months to a year from now:

"Koya Tabata, a Credit Suisse analyst, recently warned investors that the restructuring of Sony is perilously overdue and must be radical. Sony management needs to make a rapid shift in its business model to one driven by earnings in the content business, he said."

Sony's stock is up because the market expects them to shift focus from unprofitable hardware to content. How relevant is PS3 going to be to a new "content focused" Sony that it's stockholders are clamoring for?

[40cal]

First, yes layoffs can make stocks worth more, I have seen it happen many times because when you are doing less volume like right now (bad global economy) you need less workers, less workers equal less payroll in turn leads to higher profits. Payroll is the easiest overhead to control. WOW!

Second, Sony has been restructuring ever since Howard Stringer took the helm, the problem is not that Sony is not making money it is that they should and most likely can make more money than they are currently making. Yes some more restructuring needs to happen and yes Howard needs to be given more direct control over the corporation.

Third, Right here X-Box fans/ PS3 haters, this has nothing to do with Sony Computer Entertainment. Most of the restructuring is going to take place with older techs, and in manufacturing divisions. I would also suggest that the Sony haters take a look at the market performance for Sony and Microsoft over the last 52 weeks, neither company is doing great but Sony has been weathering the storm better.

Microsoft Corp (MSFT) 20.45
52 Week High 35.65
52 Week Low 17.50

Sony (SNE) 21.60
52 Week High 57.19
52 Week Low 18.09

[dcbronco]

Since when is losing 60% of your stock value better than losing 45% of your stock value. And Sony can't compare to Microsoft. Microsoft has nearly 40 billion in the bank, while Sony has 4 billion as of the last fiscal year. Microsoft has 0 long term debt while Sony has over 12 billion in long term debt. Sony estimated they would make 2 billion profit this fiscal year(pre-20% decline in electronic sales), their estimate. Microsoft has sometimes 3 times that in profit in a quarter. There is no comparison.

The worst part is that Sony's stock price is based on failed expectations. Microsoft's is based on speculative games played by market insiders. Sony needs the PS3 and Blu-ray to live up to expectations and neither has. They've lost billions neither product will ever earn back.

[THELANDOFSAND]

That should save the system.

And no Sony, that doesn't mean a demented advert that doesn't even show the game or make any sense.

[bobdog626]

They are Betting The Farm on KillZone.Everthing else has not Live up to the Hype.They can't Aford This one to Fail.MGS is the only one that did well but KillZone has to be Twice as Good in order for the PS3 to have a chance in this War.

[DJ]

Are getting really old. Come on, it's Sony's most Profitable division. PS2 is still healthy, while PSP and PS3 are experiencing continual sales growth in both hardware and software. Corporate restructuring is definitely necessary, seeing as how SCEE is so disjointed I wouldn't doubt changes being made (yet again).

[Firstkn1ghT]

I been predicting this for some time now. Sony is just not the power house it used to be. The ps3 is just a financial mess and putting Sony deeper in debt. Bad decisions were made at Sony and they need a big change.

[Funky Town_TX]

you should want them around. Even of you hate M$ you should want them around. M$ and Sony has pushed each other this gen. Competition only helps consumers guys. We all know that M$ needs competition to keep them honest. I am put of by Sony's arrogance, but I do want them around, and I will support the PS3 in the near future. Lets spend more time gaming and not worrying if Sony is making money. Let those billionaires at Sony worry about that.

[SaberEdge]

Having Sony drop out of the videogame market would be one of the worst things that could happen to the industry and to gamers.

Luckily, I don't think that is even remotely possible at this time. I predict that all three console makers will weather this economic recession and will be around for years to come. Competition is good.

[IWentBrokeForGaming]

but because they are... it got me a great Sony Bravia 52" for dirt cheap! and I finally can say I've got a tv that does my games justice! not to mention blu-ray, the g/f and I watched Dead Mans Chest on it last night and holy f**k... truely amazing!

[dcbronco]

I wish they hadn't gotten rid of their SXRD line. Those things are beautiful. I'll have to save for one of their SXRD Projectors.

[karlostomy]

there is compounding evidence that the article is correct.

Sony is losing money on too many fronts.

I would prefer to see them concentrate their efforts in areas that have been historically profitable for them, but at the same time they need to reduce their speculative ventures.

isn't that what the gist of the article was?

pretty much spot on, imo.