Rich Fiscus
7 Oct 2011 13:12
Sony's offer to buy Ericsson's stake in the two companies' joint handset operation for a reported $1.3 billion may hint at plans for smartphone content offerings.
Sony Ericsson Mobile Communications was founded 10 years ago as a joint venture between the two companies, combining the handset divisions from both. They are currently engaged in scheduled negotiations over the company's future.
One analyst believes Sony's intent is to create better synergy with their other divisions. According to Reuters, JP Morgan's Yoshiharu Izumi said, "Up to now Sony's products and network services have all been separate. Unifying them would be positive."
Sony is the only company in the world to be a major player in nearly every aspect of movie, television, and music production, as well as selling nearly every type of device you might use to consume their content.
Despite that apparent advantage, they have generally done a poor job of creating synergies between those different divisions for content distribution. For example, Sony lagged significantly behind Microsoft in offering movies and TV shows through their game consoles.
In the case of Sony Ericsson, the problem is compounded by the fact Sony only owns half of the company. Becoming sole owner would likely make it easier to arrange content deals with the various companies in those other divisions.
Both companies have declined to comment on the report.