Seriously, I wouldn't touch a Sony device with a 10ft pole and I fully expect all the good things SE have started to do with the Xperia brand to vanish overnight.
... maybe Sony is just trying to get out of the phone market quickly. 1.47B in cash looks more like a "I'm out" operation, and buying Ericsson's portion was the easiest way to pull the plug. But they could make one hell of a comeback, though.
I don't think that makes any sense. If Sony wanted to get out of the phone business, they could have just sold their share of SE. Or simply decide to stop is Ericsson was ready to do the same (looks like they did since they sold their share, at least in some degree).
That would mean losing rights, tech and patents for hard cash. If Sony buys Ericsson out, Sony can stop making phones and start making money from licenses. I'm sure that someone like HTC or other phone maker would be interested in a "powered by Sony" device. Even with the PSN fiasco, Sony is still one hell of a brand with a lot of presence in audio and video. Or maybe they are just paving the way for another partner. Sony-"something"?
Just the patents they got is worth far more then 1.47 billions.
Google bought Motorola mobile for 10 times the money and they don't have a better patent portfolio then Ericsson.
Its just incompetent people who have been bosses at Ericsson/Sony Ericsson.
(one small example: to "save" money so could Ericsson not hire anybody. So when the interns quit, we could not hire them for 2K a month. Instead we hired them as consultants for 20K a month. Or the Rolf Skoglund that threw out all Unix workstations and deployed 40K PCs. They wanted us to develop new products in Excel.IT costs went up 10 times and productivity down.)
Sony purchases 50% of Sony Ericsson for ~$1.5b ... Currently, SE has ~2% market share. They get hardware and design technology exclusivity (rather than sharing), with a little bit of software customization.
HP purchased 100% of Palm for ~$1.2b ... in 2009, Palm had ~1.5% worldwide market share. They got new hardware and design technology, and a completely independent OS environment.
Either Sony is way overpaying for this, or HP picked up Palm for a steal. Or a combination of both.
Sure, but Sony already had access to those patents, since they owned 50% of Sony Ericsson. Granted, yes, it was a separate subsidiary, needing to license the patents, etc., but I still can't account for the differences in price.
The yen is very strong, the euro is very weak, and Ericsson wants to get to focusing on its network infrastructure, so this is a great time for Sony to make that purchase. Palm had some brand power and patents, but hindsight is 20/20 and it was a costly investment.
Sony is hoping to concentrate on the very profitable mobile, consumer electronics space when the large consumer electronics, like HDTVs, are losing money for every company.
Besides, the sale also includes cross-licensing agreements on five core patent portfolios from Ericsson along with all the ones that SE had. Most analysts believe it a good deal.
I worked for Ericsson prior to and after Sony getting involved in Ericsson's handset development.
Prior to Sony, consumer focus was something Ericsson just couldn't get it's head around. In fact, handset sales were seen only as a way to get network equipment sales. This was to the extent that Ericsson's handset business was allowed to make a loss, provided new network features were utilised fast. As an engineer in the company, it was incredibly frustrating to see opportunities to make great products killed time and again.
Once Sony got involved, consumer focus improved, but Ericsson still considered the network the priority for handsets.
With a bit of luck, now that Sony has ditched the network focused retard, interesting products may appear.
I guess you worked after 1997-98? I remember when Ericsson where Nr1. They had by far the best specced phones but lacked design.
Everybody laughed at Nokia: They make gummy boots and tires.
The internal politics at Ericsson was a mess. Ericsson could not hire people. We had Ericsson Data that hired out "consultants" internal at Ericsson. (they in their turn hired people outside Ericsson data. But Ericsson data put 30% extra on the tab to Ericsson. Ericsson data made a huge profit. All other parts of Ericsson had insane costs. We had 17 year old consultants that had not even quit high school! People who earned 10 times as much as we employees did.) Most highly qualified people at Ericsson quit. Some came back as consultants the day after with 10 times the salary.
Then Rolf Skoglund came with his insane Microsoft ideas. (ex Microsoft VP)
Whole Ericsson got the same computer environment : Ericsson Standard Office environment: ESOE. They were so insane that phones/base stations should be developed in Windows/Excel.
As you now: A phone/base station needs to run simulations. A single simulation took 4-6 weeks with the fastest computers. Back with NT 3.51 - 4: try to not reboot them in that time! We lost YEARS in computer time. Telephones came out 9-12-18 month after schedule. in 5 years with Rolf Skoglund: Ericsson's shares went down from over 250SEK to 3SEK.
It was then that Sony entered the partner ship. And they did not bring anything beside the brand names Walkman, Cybershot and playstation. At least 2 of those brands have zero meaning today.
(BTW. If you remember the SETI at home scandal at Ericsson. I ran seti at home over 500 + sun servers and got 3 place in Sweden in just 3 days. Fun times. It was also in "my" house they found the largest MP3 server. But I had nothing to do with that. )
In 2001 we bought 1.5 terra hard disk space. It cost over 200K dollars. Today you can get it for 70 dollar. Love IT.
Somehow Ericsson is one of the few Android vendors that don't have to pay protection money to MSFT. Probably because they have an extensive patent portfolio.
Lets say Sony manages to sell 5 million phones/year. Just the licensing fees to MSFT would be 25-75 million dollar/year. Somehow they sell Ericsson's part for 1 billion Euro including cross license.
The only thing I can guarantee: Sony will never be successful in Mobile telephony. It was a huge mistake by Ericsson to start the joint venture. (I worked at Ericsson at the time as a consultant. According to "experts" Sony would bring great design to Ericsson. The funny thing is that Sony never have designed a beautiful of good phone in history. Ericsson have at least a track record in being nr1 vendor in the world. Sony have nothing.)
Sweden loves to give away its companies. All people here will work to the state = the government will be in power for ever.
This is a sad day for Sweden.
BTW: Thanks Microsoft. Killed Ericsson with Rolf Skoglund and killed Nokia with their insane CEO who have empty factories and buys Korean made phones with Windows Mobile and brand it "nokia"
200K worker that have lost their jobs thanks to MSFT.
O come on now, Ericsson hired the ex MS guy and Nokia went into the venture with MS willingly, don't place all the blame on MS for taking advantage of what your companies were giving out. Your companies made the decisions that led to what you don't like and they should take a majority of the blame.
I wont touch anything Sony does after the DRM, SCMS, SWG, etc. I owned a SE Mobile, but now I can mark that off my list of possible future cell phones. :-/
Are you talking about the root-kit and star wars mmo? The only interactions I've had with their products has been Bravia TVs and Playstations, so I don't have any aversion to them. I was burnt before by Samsung/LG feature phones, so my next smartphone will probably be another HTC, a Motorola, or a Sony (Ericsson).
Apple wants to enter TV. Sony is already there. Both are in phone, Sony will soon be into tablets. If Sony has a comparable platform based on Android at a competitive price then they at least offer an alternative to the whole Apple-deal, with hopefully the same level of integration.
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dagamer34 - Thursday, October 27, 2011 - link
Hopefully some of the designers at Sony Corp. will be working on phones now too. Piano black looks nice on a phone.Exodite - Thursday, October 27, 2011 - link
Until you touch it, that is.Anyway, I've got one word for this...
Doom!
Seriously, I wouldn't touch a Sony device with a 10ft pole and I fully expect all the good things SE have started to do with the Xperia brand to vanish overnight.
Ethaniel - Thursday, October 27, 2011 - link
... maybe Sony is just trying to get out of the phone market quickly. 1.47B in cash looks more like a "I'm out" operation, and buying Ericsson's portion was the easiest way to pull the plug. But they could make one hell of a comeback, though.Kristian Vättö - Thursday, October 27, 2011 - link
I don't think that makes any sense. If Sony wanted to get out of the phone business, they could have just sold their share of SE. Or simply decide to stop is Ericsson was ready to do the same (looks like they did since they sold their share, at least in some degree).Ethaniel - Thursday, October 27, 2011 - link
That would mean losing rights, tech and patents for hard cash. If Sony buys Ericsson out, Sony can stop making phones and start making money from licenses. I'm sure that someone like HTC or other phone maker would be interested in a "powered by Sony" device. Even with the PSN fiasco, Sony is still one hell of a brand with a lot of presence in audio and video. Or maybe they are just paving the way for another partner. Sony-"something"?shompa - Friday, October 28, 2011 - link
Just the patents they got is worth far more then 1.47 billions.Google bought Motorola mobile for 10 times the money and they don't have a better patent portfolio then Ericsson.
Its just incompetent people who have been bosses at Ericsson/Sony Ericsson.
(one small example: to "save" money so could Ericsson not hire anybody. So when the interns quit, we could not hire them for 2K a month. Instead we hired them as consultants for 20K a month. Or the Rolf Skoglund that threw out all Unix workstations and deployed 40K PCs. They wanted us to develop new products in Excel.IT costs went up 10 times and productivity down.)
WeaselITB - Thursday, October 27, 2011 - link
Wait, I'm confused.Sony purchases 50% of Sony Ericsson for ~$1.5b ... Currently, SE has ~2% market share. They get hardware and design technology exclusivity (rather than sharing), with a little bit of software customization.
HP purchased 100% of Palm for ~$1.2b ... in 2009, Palm had ~1.5% worldwide market share. They got new hardware and design technology, and a completely independent OS environment.
Either Sony is way overpaying for this, or HP picked up Palm for a steal. Or a combination of both.
-Weasel
Kristian Vättö - Thursday, October 27, 2011 - link
Remember that there is a lot more than just market share involved. For example patents are a major part of acquisitions.WeaselITB - Thursday, October 27, 2011 - link
Sure, but Sony already had access to those patents, since they owned 50% of Sony Ericsson. Granted, yes, it was a separate subsidiary, needing to license the patents, etc., but I still can't account for the differences in price.And Palm presumably had a pretty decent patent portfolio itself -- http://articles.businessinsider.com/2011-08-18/tec...
-Weasel
Exodite - Thursday, October 27, 2011 - link
Trending is important.SE is 2% and trending up, Palm was 1.5% and trending down.
Having a completely independent OS environment isn't necessarily better either, when it comes to sales price.
WeaselITB - Thursday, October 27, 2011 - link
That's a good point - I hadn't considered that. Thanks.-Weasel
ruibing - Tuesday, November 15, 2011 - link
The yen is very strong, the euro is very weak, and Ericsson wants to get to focusing on its network infrastructure, so this is a great time for Sony to make that purchase. Palm had some brand power and patents, but hindsight is 20/20 and it was a costly investment.Sony is hoping to concentrate on the very profitable mobile, consumer electronics space when the large consumer electronics, like HDTVs, are losing money for every company.
Besides, the sale also includes cross-licensing agreements on five core patent portfolios from Ericsson along with all the ones that SE had. Most analysts believe it a good deal.
gcor - Thursday, October 27, 2011 - link
I worked for Ericsson prior to and after Sony getting involved in Ericsson's handset development.Prior to Sony, consumer focus was something Ericsson just couldn't get it's head around. In fact, handset sales were seen only as a way to get network equipment sales. This was to the extent that Ericsson's handset business was allowed to make a loss, provided new network features were utilised fast. As an engineer in the company, it was incredibly frustrating to see opportunities to make great products killed time and again.
Once Sony got involved, consumer focus improved, but Ericsson still considered the network the priority for handsets.
With a bit of luck, now that Sony has ditched the network focused retard, interesting products may appear.
shompa - Friday, October 28, 2011 - link
I guess you worked after 1997-98?I remember when Ericsson where Nr1. They had by far the best specced phones but lacked design.
Everybody laughed at Nokia: They make gummy boots and tires.
The internal politics at Ericsson was a mess. Ericsson could not hire people. We had Ericsson Data that hired out "consultants" internal at Ericsson. (they in their turn hired people outside Ericsson data. But Ericsson data put 30% extra on the tab to Ericsson. Ericsson data made a huge profit. All other parts of Ericsson had insane costs. We had 17 year old consultants that had not even quit high school! People who earned 10 times as much as we employees did.) Most highly qualified people at Ericsson quit. Some came back as consultants the day after with 10 times the salary.
Then Rolf Skoglund came with his insane Microsoft ideas. (ex Microsoft VP)
Whole Ericsson got the same computer environment : Ericsson Standard Office environment: ESOE. They were so insane that phones/base stations should be developed in Windows/Excel.
As you now: A phone/base station needs to run simulations. A single simulation took 4-6 weeks with the fastest computers. Back with NT 3.51 - 4: try to not reboot them in that time! We lost YEARS in computer time. Telephones came out 9-12-18 month after schedule. in 5 years with Rolf Skoglund: Ericsson's shares went down from over 250SEK to 3SEK.
It was then that Sony entered the partner ship. And they did not bring anything beside the brand names Walkman, Cybershot and playstation. At least 2 of those brands have zero meaning today.
(BTW. If you remember the SETI at home scandal at Ericsson. I ran seti at home over 500 + sun servers and got 3 place in Sweden in just 3 days. Fun times. It was also in "my" house they found the largest MP3 server. But I had nothing to do with that. )
In 2001 we bought 1.5 terra hard disk space. It cost over 200K dollars. Today you can get it for 70 dollar. Love IT.
Ronakbhai - Friday, October 28, 2011 - link
Basically the big guy on the right ate the small guy on the left.rddtretff - Friday, October 28, 2011 - link
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shompa - Friday, October 28, 2011 - link
Somehow Ericsson is one of the few Android vendors that don't have to pay protection money to MSFT. Probably because they have an extensive patent portfolio.Lets say Sony manages to sell 5 million phones/year. Just the licensing fees to MSFT would be 25-75 million dollar/year. Somehow they sell Ericsson's part for 1 billion Euro including cross license.
The only thing I can guarantee: Sony will never be successful in Mobile telephony. It was a huge mistake by Ericsson to start the joint venture. (I worked at Ericsson at the time as a consultant. According to "experts" Sony would bring great design to Ericsson. The funny thing is that Sony never have designed a beautiful of good phone in history. Ericsson have at least a track record in being nr1 vendor in the world. Sony have nothing.)
Sweden loves to give away its companies. All people here will work to the state = the government will be in power for ever.
This is a sad day for Sweden.
BTW: Thanks Microsoft. Killed Ericsson with Rolf Skoglund and killed Nokia with their insane CEO who have empty factories and buys Korean made phones with Windows Mobile and brand it "nokia"
200K worker that have lost their jobs thanks to MSFT.
Camikazi - Saturday, October 29, 2011 - link
O come on now, Ericsson hired the ex MS guy and Nokia went into the venture with MS willingly, don't place all the blame on MS for taking advantage of what your companies were giving out. Your companies made the decisions that led to what you don't like and they should take a majority of the blame.Valis - Saturday, October 29, 2011 - link
I wont touch anything Sony does after the DRM, SCMS, SWG, etc. I owned a SE Mobile, but now I can mark that off my list of possible future cell phones. :-/ruibing - Tuesday, November 15, 2011 - link
Are you talking about the root-kit and star wars mmo? The only interactions I've had with their products has been Bravia TVs and Playstations, so I don't have any aversion to them. I was burnt before by Samsung/LG feature phones, so my next smartphone will probably be another HTC, a Motorola, or a Sony (Ericsson).cfaalm - Saturday, October 29, 2011 - link
Apple wants to enter TV. Sony is already there. Both are in phone, Sony will soon be into tablets. If Sony has a comparable platform based on Android at a competitive price then they at least offer an alternative to the whole Apple-deal, with hopefully the same level of integration.This will be very interesting.