Sony is just not having a good year. The company is reportedly preparing to post yet another loss from their TV business. In response Sony Corp. announced on Monday that it would split the TV division into three parts. The goal is to make operations more accountable with the hope that it can turn things around.
If Sony does post yet another loss from their TV segment, it will mark the eighth year in a row that division has lost money. In an attempt to avoid another horrendous year, the company has split the business into three parts, one in charge of LCD TVs, one for outsourcing, and the last for next-generation TVs. The split will happen November 1, 2011.
"By dividing into three divisions, we will make clearer the mission and responsibilities of these," said Sony spokeswoman Ayano Iguchi.
The financial results for the TV division during the July-September period should be reported Wednesday, November 2. According to Reuters, analysts are estimating Sony will fall short of its operating profit outlook for the year, which runs until March 2012. What's even worse is news that Sony is looking to sell off its stake in a joint project with Samsung to create an S-LCD.
The Bravia unit already took a massive hit early in October when it was reported that 1.6 million sets were being recalled worldwide due to a defective component, which could cause them to melt. Back in August, Sony's second in command Kaz Hirai was emphatic that the TV business was important and worth fixing. One has to wonder if Hirai is rethinking that position in the wake of the recall, and yet another disappointing sales year.
We'll see if this split makes things any better for Sony TV sales performance. I don't imagine that creating even more complexity within the business will magically bring the TV division back to life or at least keep it from posting a loss next year. What do you think about this business move by Sony?
