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IT Sony to Cut 8,000 Jobs
Michael Barkoviak - December 9, 2008 7:09 AM
Print E-mail del.icio.us 54 comment(s) - last by RoberTx.. on Dec 11 at 2:45 AM
Sony is the latest company to announce job reductions to help save money

Sony announced it will cut its electronics workforce by 8,000 over the next two years while also shutting 10 percent of its worldwide manufacturing sites.

The Japanese company hopes to trim $1.1 billion in costs while cutting the jobs from now until April 2010.  It's uncertain which countries would be hardest hit, though it is likely locations in the United States and Japan will suffer high job reductions.

Sony has 57 production facilities spread across the world, and additional shutdowns could take place in the future, analysts warn.

Analysts are unsure if the job reductions will be enough, as the company still has 186,000 employees worldwide.  Furthermore, Sony will hold off expanding a LCD TV manufacturing plant located in Slovakia.

"Going forward, Sony intends to adjust product pricing to mitigate the impact of the appreciation of the yen, curtail or delay part of its investment plans, and downsize or withdraw from unprofitable or non-core businesses," Sony said in an official statement.

Sony will have to reduce investments, outsource production on certain consumer products, and eliminate unprofitable businesses while it tries to save that $1.1 billion.

Sony will outline additional plans next month, when it will also announce 3Q fiscal results.

Sony CEO Howard Stringer and his executives thought they had things under control after a company restructuring in 2005 when Stringer took control of the company.

Similar to Samsung and other consumer companies, Sony faces an unsure Christmas, due to a slumping global economy that has forced many consumers to be more frugal with their spending.

Other Japanese companies are expected to announce similar job reductions, as the Japanese economy continues to struggle and shrink, according to Japanese media reports.  In fact, the economy shrank 1.8 percent in the quarter, which is higher than the 0.4 percent analysts predicted.

Sony's stock value has dropped 70 percent on the Japanese market since the start of fiscal 2008.  Due to the struggling Japanese economy, its stock values are expected to continue to drop further before the year is over. 

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Sony is hit by the economy because it is sony
By tastyratz on 12/9/2008 8:20:26 AM , Rating: 5
Barring the playstation 3, Does anyone feel that a new Sony product is good value for the product provided anymore?
They have gotten greedy and they are paying for it, maybe this will be a realization that they are in fact getting far too greedy. They used to have a much larger die hard dedicated loyalty which has recently faded significantly as the brand of choice in Japan. The products - while still good - are no longer great and not built with the same longevity and quality in mind.

They charge 30-40% more for their tv's that spec out the same as most others on the market, and expect people to pay it? Thanks, I will stick to my Panasonic

(source http://www.digitalworldtokyo.com/index.php/digital... )




RE: Sony is hit by the economy because it is sony
By SunAngel on 12/9/2008 8:31:07 AM , Rating: 4
still refusing to accept economies all across the globe are slowing down, especially in the U.S.A.?

sony is doing what it does best, and that is being sony. i would bet that 5/8 of their revenue is because of brand loyalty.

if any company is going to weather the global economic slowdown it surely will be sony. their breakeven point (in customers) is truely their brand loyal customers. how many companies have that statistic?


By ebakke on 12/9/2008 7:38:07 PM , Rating: 2
quote:
still refusing to accept economies all across the globe are slowing down, especially in the U.S.A.?
Yes, but slowing economies help weed out the struggling businesses. Companies like GM, Sears/Kmart, AMD, .... , and Sony that have been struggling for months/years can't weather economic downturns as easily as companies that have been doing well for years. A company with consistently poor quarterly numbers clearly has issues that need to be addressed, and fixing them when the economy dips is near impossible.


By RoberTx on 12/11/2008 2:45:55 AM , Rating: 2
Business in Texas is doing quite well. I know, I live here. If you don't have a job in Texas, you don't want a job. I'm not saying some places aren't hurting but Texas isn't one of them. Most all the conservatively governed states are doing quite well. Mark Twain said, " If you don't read the news you'll be uninformed, if you do read it you'll be misinformed."


RE: Sony is hit by the economy because it is sony
By Hiawa23 on 12/9/2008 8:33:16 AM , Rating: 1
I really don't think it has as much to do with greed as the financial crisis which has cut spending by consumers globally. SONY to me still stands for quality infact when I buy electronic devices, the first name I look for is Sony as darn near all my electronics bear their name, & many products I have enjoyed years of great service, so to say Sony is any more greedy than say Sharp or anyone else is crazy.

Companies are in business to make money, period. I own a PS3, & this isn't good news at all, as they already taking losses on the console as is, & not sure a price cut which many want is feasible right now.

Sony is no more greedy than Microsoft, Nintendo, Ford, GM, & any other company who is business to make as much money as possible. What this tells me is almost all sectors will be hit by the global recession, which might be a good thing if it gets alot of companies to run more leaner & efficient going forward.


By tastyratz on 12/9/2008 9:16:20 AM , Rating: 1
My house and home theater use to be filled almost entirely with Sony equipment and Sony only.
They are in the business to make money, just as Apple is in the business to make money. Their biggest issue is that they overcharge. The prices do not reflect product quality as much as they used to so Sony is no longer as much of a good value in comparison to their competition.

Sure they make a good (not stellar) product but if another company with a good recognized name makes one just as nice or a little nicer for $200 cheaper you will find yourself opting for the other product. Other brands such as Sharp, Samsung, pioneer, and Panasonic have built themselves a far better reputation since Sony's good days. This really detracts from the appeal of Sony as they are not the "only sheriff in town" anymore.

The global economy is suffering and people cant afford to pay for overpriced goods just for a name brand which holds no benefit anymore.


RE: Sony is hit by the economy because it is sony
By FITCamaro on 12/9/2008 9:40:57 AM , Rating: 5
Other than gaming devices and baring some kind of fire sale pricing, it will be a cold day in hell before I ever buy another Sony product. They do not stand for quality any more than any other major competitor and their pricing is always higher. Plus they still refuse to use industry standard formats for media and always create their own which is more expensive. UMD, Memory Stick, Blu-ray.

We were told once HD-DVD was gone Blu-ray prices would come down. So where is the price drop? Blu-ray prices are $20 for movies most don't want up to $35 for those people do. It will likely be years before Blu-ray prices drop. While DVD prices dropped pretty quick once it was established, it wasn't run by Sony. I mean look at memory stick prices. The format has been out for years and a 4GB stick is still around $40. A 4GB SD card or 2x2GB Micro-SD pack card is less than $10.


RE: Sony is hit by the economy because it is sony
By tastyratz on 12/9/2008 9:55:47 AM , Rating: 2
While we are in the same boat as far as a view on Sony products, I disagree with you on the optical front. All of the other Sony specific media formats were really losers from the start, and I hate how proprietary they try to be. Blu-ray was a good idea.

DVD's have come down yes - but they were popularized by the ps2 EIGHT years ago. Inflation alone since 2000 accounts for 26%

New DVD movies were usually 25 dollars or so. That's just under $32 adjusted for now. New BR seems to be launching at similar pricing schedules... You are just spoiled by all of the cheap pricing just as the VHS crowd when the dvd came out.
Blu-rays when the ps3 first came out were commonly $40 and used on ebay even $20-25. Walmart sells 9.99 BR's now. I would call that prices coming down.
Hell I buy many blurays for 15-20 dollars on average -and if you buy them online its much cheaper. The new batman dark knight movie can be preordered for 24dollars online. A far cry CHEAPER from DVD at launch.
This argument applies to any and all new technology.


RE: Sony is hit by the economy because it is sony
By The0ne on 12/9/2008 1:30:50 PM , Rating: 2
CD and DVD's had a much easier time transition due to many factuors such as manufacturing cost, wide support for the hardware and software side, competition, PC adoption, an actual requirement for the amount of space on the CD/DVD, etc.

Just with those listed above, BD and HD had little in common. BD manufacturing cost is high and will be high for a while, support isn't really there for hardware and software, there's hardly any competition on the hardware side which is bad on various points, PC adoption is very small, and the amount of space needed by most applications doesn't use that much....yet. Sure you can fill the disc with junk but I'm talking about actual quality materials, same for games. Loading a game with crappy CG's is not a good thing.

Specifically for me, I'm waiting for the prices to fall on the hardware and software (both for PC and stand-alone), more selection in BD movies and prices of the media to drop.


By tastyratz on 12/9/2008 2:05:09 PM , Rating: 2
There really was no viable competition and "wars" for cd's and dvd's however. They were an evolutionary product with nothing for sale on par. Sure there was the dvd-/+ R write medium war for awhile but that was minimal and only applied to burners.

Are you saying that 50gb or more of portable optical storage is something of which no demand exists even though 1tb hard drives are commonplace now? If so I sorely disagree. I just think it has not hit the consumers price thresh-hold to become commonplace yet. I predict fairly fast adoption at $150 per burner and $1 per blank (the real inhibitor)

more space always has a need in the enterprise and business market. Movies utilize a lot more space now than they used to and have less compression resulting in obvious quality increases. Whether or not you personally value any additional content which may or may not be available has nothing to do with consumer demand.

I think of bluray vs hddvd as less of a competitive nature and more of an unstable market with enough volatility holding consumers from purchasing. Ever since the "war" was over sales have flourished. While the format is the same many manufacturers now produce and sell bluray media players.

Blu ray disks did require retooling to make movies just as any other optical format (just to a greater degree compared to hddvd) but manufacturing costs are lowering as tooling has paid for itself over time. LICENSING costs are probably what you should be referring to... however those are STILL trivial in big production for big companies. Large quantity sales range from 4 cents to less than 1 cent per disc paid to aacs (the macrovision security) which costs a lot more than the $3500 a year paid to Sony
http://www.emedialive.com/Articles/ReadArticle.asp...

Movies have cut cost at least 50% yet nobody recognizes this because it costs more than dvd's do? Do we all so quickly forget the vhs to dvd days?


RE: Sony is hit by the economy because it is sony
By akugami on 12/9/2008 8:40:27 PM , Rating: 2
The PS2 did not popularize DVD's. If anything DVD's helped popularize the PS2 since it provided a cheap (if crappy) DVD player that can double as a gaming console.

It is the DVD format's superiority over VHS (and Beta) tapes that made it such an in instant hit. While initial encoding quality on early DVD's weren't great, there were substantial advantages in using DVD's over VHS tapes. One was there was no need to rewind. Two, you can almost instantly get to where you want in a movie where VHS tapes required a lot of fast forwarding or rewinding. Three, they were cheaper to manufacture than VHS tapes, meaning cheaper prices for consumers AND increased profits for publishers.

Fitcamaro is right. Sony, while not bad, does not stand for the same high quality as it once did in the 80's. There has been a steady increase in product quality from Sony's leading competitors while Sony has actually dropped in product quality over the years. The lower end Sony stuff is no better than Pioneer and Samsung, among others depending on market. The higher quality stuff in the "prosumer" category is grossly overpriced.

Sony is just lucky it has such blind and loyal followers to keep it afloat.


RE: Sony is hit by the economy because it is sony
By tastyratz on 12/10/2008 12:44:46 AM , Rating: 2
I think your blurring the benefits of the technology with adoption. While dvd was clearly superior than VHS for many obvious reasons, the ps2 played a large role in its early adoption. Obviously other players existed but it certainly bolstered it.

(side note: blu ray capable player adoption is triple the adoption rate of dvd at launch http://www.videobusiness.com/article/CA6572676.htm... )


By akugami on 12/10/2008 1:56:41 AM , Rating: 2
Blu-Ray adoption rate has zero to do with DVD adoption rate nor does it prove the PS2 was the main reason DVD's were adopted at the rate they were. The PS2's may have helped but in no way was the PS2 the main or even major reason that DVD's succeeded the way it did. The technological superiority of the format compared to VHS as well as the fact that aside from higher (at the time) remastering and encoding costs, the actual format was cheaper to produce.

While no one questions that the PS2 helped DVD sales, it was in no way a major reason for the success of DVD's. Sure, DVD's were slower on the uptake than Blu-Ray but if one thinks it through, it is quite logical that this is so. We were shifting from an old analogue format to a new digital format. The shift from DVD to Blu-Ray, while full of difficulties, is in many ways easier. VHS to DVD would be a revolutionary change while DVD to Blu-Ray is evolutionary.

We should also note that PS2's were absolutely crap for playing DVD's. PS2's were also not vastly cheaper (they were roughly the same in cost) compared to available set top DVD players that were much easier to use. There are a lot of factors that went into the success of the DVD's but to argue that a major reason for this was the PS2 is IMHO baseless. Yes, the PS2 helped but you're going to have to bring a lot more to the table than you've done so far to convince me that the PS2 was a major reason for the success of DVD's.

As for Blu-Ray adoption rate, Blu-Ray movie sales will say that while Blu-Ray capable players (in one form or another) may be selling well, Blu-Ray movie sales themselves are not exactly setting the world on fire. The problem also with the article you linked to is the fact that while a lot of people bought PS3's for their Blu-Ray capability, many bought it with no intention of buying Blu-Ray movies or at least not until they drop to the $10-20 range on average. The article you linked to is misleading because many bought the PS3 for games first and foremost and not for movies. With the current size of the video game market (thanks to the PS2), the PS3 was guaranteed to sell millions easily. If anything, PS3 sales have been lackluster and should be better.

I have nothing against Blu-Ray movies. I own an LG Blu-Ray / DVD burner for my main CPU rig. I also have a PS3 and have had four PS2's (for one reason or another) over the years. I bought my GF a Sony Ericson phone for a gift last year. But I don't drink the Sony kool-aid.


RE: Sony is hit by the economy because it is sony
By Hiawa23 on 12/9/2008 10:24:44 AM , Rating: 2
You said you were told when HD DVD was put to rest Blu ray prices would come down. Are you kidding me? When has there been a time for any product when you have no competition prices actually come down. HD DVD was the reason Blu ray prices dropped so fast. competition keeps prices down.


By FITCamaro on 12/9/2008 10:35:37 AM , Rating: 3
That's kind of my point.


By BansheeX on 12/9/2008 2:05:34 PM , Rating: 2
HD-DVD was the physical battle, the content battle still rages on. As the library of blu-ray expands, studios will be competing with each other more and more. But there's also the popularity of the previous format to overcome. If you're a movie studio, why wouldn't you position your HD titles for premiums over the DVD versions? If you drop the BDs too fast, you cannibalize instead of milk. So in a way, people who are buying DVDs are to blame, because they're seen as double-dipping opportunities.

Anyway, I just bought 6 Bond movies on blu-ray for $7 a piece on Amazon's black Friday sale, so it's not like I'm not finding any deals.


RE: Sony is hit by the economy because it is sony
By BansheeX on 12/9/2008 1:51:15 PM , Rating: 2
quote:
Plus they still refuse to use industry standard formats for media and always create their own which is more expensive. UMD, Memory Stick, Blu-ray.


Trying to play favorites in the market is retarded. Every company lays its eggs or tries to be the format winner. Are you boycotting Warner movies since they tried to convince the DVD forum of a red laser successor that was only marginally better than DVD? Are you boycotting Microsoft for the largest failure rate of any console in the history of gaming, or for selling a proprietary OS with proprietary APIs? Why didn't you boycott the horrible consumer format CD-ROM, that was licensed out by Sony and Philips? 3.5" floppies? Surprise, it was Sony, better go wash your hands in retroactive revilement for having used them. The fact is, the world functions on competition between propriety, the winner of which the consumer chooses based on value, not price.

Memory Stick is insignificant, it's a storage medium, not a content format. It cost a little more, but was more compact. And UMD is not a proposed replacement for anything, it's a proprietary mobile format for the PSP no different than TV shows Nintendo released on GBA cartridges. How in the world was Sony trying to "force their hand" on that one? Let's see, they should have... released a computer tool that would allow you to rip only Sony DVDs into a format that you could watch on your PSP? But wait, what would be small enough to get them on there? In your world, memory stick doesn't exist. Okay, so maybe we can bulk it up a little for a sandisk card. Still got a problem... no other studios would have been on board with that, and if the tool ever got hacked to do it with non Sony-movies, they'd be sued into oblivion by the MPAA. Even Sony has to play ball.

quote:
and their pricing is always higher.


When it came to Blu-ray, the movies themselves were no more expensive than HD-DVD ones. The players were what cost more, and that's because (a) it was a more cutting edge format that had worse yields at the time and (b) Toshiba was selling at a loss, which was a risky strategy that alienated other manufacturers in an attempt to make blu-ray look less consumer-friendly.


By Reclaimer77 on 12/9/2008 9:46:30 PM , Rating: 2
quote:
Are you boycotting Microsoft for the largest failure rate of any console in the history of gaming


Microsoft designed and fabricated those motherboards that failed ?? Hmmm... news to me.


By BansheeX on 12/10/2008 8:44:20 AM , Rating: 2
Oh, please. Microsoft is not responsible for overseeing construction of their own product? Of course they are, and they knew about the issues before launch and took no measures to rectify them. They would have rather unleashed a faulty product earlier than a quality one at the same time as the PS3, they wanted to be competition-free for a full year.

http://www.dailytech.com/Xbox+360+Failures+The+Ins...


By Reclaimer77 on 12/9/2008 4:43:46 PM , Rating: 2
quote:
They do not stand for quality any more than any other major competitor and their pricing is always higher.


I agree.

The thing about Sony is they DO make good stuff, but its at such a premium its prohibitive. And even then they don't compete well with lower priced competitors.


By semo on 12/9/2008 5:58:49 PM , Rating: 2
i concur. i hate sony for spewing out all these medium formats.


By afkrotch on 12/10/2008 1:13:30 PM , Rating: 2
quote:
I mean look at memory stick prices. The format has been out for years and a 4GB stick is still around $40. A 4GB SD card or 2x2GB Micro-SD pack card is less than $10.


Huh? The 4 gb memory stick duo pro cost over $100 earlier in the year. Now you can get them for as little as $25.

Memory Stick Pro Duo, speeds from 80 mbps to 180 mbps. They're kind of all over the place on speeds. SD...16 mbps to 48 mbps. They are also all over the place with speeds.

Right now can get a nice 4gb Sandisk Memory Stick Pro Duo for $30. It pushes 120 mbps. I'd rather pay $30 for something with high transfer rates, than a $7 for a 4gb SDHC. It doesn't make sense on prices until you take in the fact that the SDHC is just fcking slow.


RE: Sony is hit by the economy because it is sony
By omnicronx on 12/9/2008 10:06:24 AM , Rating: 2
Amen to that! Worst part is, many of their high priced products were not even that good. Sony receivers come to mind. Never output anything close to what they say, and are well known for dropping off at higher frequencies (most do but Sonys much more so)


By tastyratz on 12/9/2008 10:21:46 AM , Rating: 2
Their receivers were never uber high end when fidelity is concerned, but they always gave you many more features and much more control in comparison to similarly priced competition. As far as my receiver I switched to Yamaha which while bare in features compared to my Sony, the sound quality is far far better.


RE: Sony is hit by the economy because it is sony
By nycromes on 12/9/2008 10:23:58 AM , Rating: 3
I have had horrible experiences recently with Sony. Older Sony products lasted for a very long time and were very high quality products. You paid for that quality, but it was worth it.

This is no longer true, the quality has dropped off considerably, but the prices have stayed the same. They are victims of their own practices of reducing quality and not reducing price. Their LCD tvs look nice, but they are also considerably more expensive than the competition (excepting perhaps Samsung).

The economy doesn't help, but Sony is falling victim to their own practices.


By Gyres01 on 12/9/2008 11:14:23 AM , Rating: 2
I agree, Sony products from 10 or 20 years ago were at the top of the quality list all the way across the board....now days not so much.....I still have a 32" Trinitron TV in my Garage that still has a Great picture, even with an old VCR. It seems that we are all being brainwashed to spend thousands to upgrade equipment that looks and works just fine.....no wonder so many folks are going bankrupt......IMHO.


By KamiXkaze on 12/9/2008 11:07:17 PM , Rating: 2
Yep Sony's 55inch xbr8 cost $2000.00 more than there rival Samsung's LN55A950.

AlX


By FITCamaro on 12/9/2008 10:37:19 AM , Rating: 2
Not to mention many Sony systems use proprietary wiring. Instead of the speakers and receivers being able to accept any cabling of your choice, the speakers have wires built into the speakers that you have to use.

Never buy a Sony home theater.


By DEVGRU on 12/9/2008 10:41:37 AM , Rating: 2
"Barring the playstation 3, Does anyone feel that a new Sony product is good value for the product provided anymore?"

No.

I've been watching Sony in a downward spiral (IMHO) for a few years now. Starting with Ken K's statements about the PS3, massive battery recalls, DRM, and rootkit infested CD's, among others. Does Sony make complete crap now? Of course not. Its just that for me, they no longer provide enough quality for the money, never mind the name.

I've recently upgraded my entire home theater system. What once was 100% Sony has been completely replaced in my home with a (superior) Samsung Plasma HDTV, Oppo DVD player, and an Onkyo receiver.

Of course, monetarily-wise it means nothing, but I went from a die-hard Sony fan boi to purposely excluding the brand from anything I buy from now on.


Job cutting
By Chadder007 on 12/9/2008 8:55:25 AM , Rating: 2
These job cuttings have gotten out of hand. Who do the companies expect to buy their products if they all cut everyone's jobs?




RE: Job cutting
By FITCamaro on 12/9/2008 9:42:40 AM , Rating: 3
Welcome to business today. CEOs only care about their year end bonus. They have little time for long term thinking about whats good for their business. It's all about propping up that stock price. Regardless of what the ramifications will be for doing so.


RE: Job cutting
By BZDTemp on 12/9/2008 10:07:12 AM , Rating: 2
Remember that while we are talking thousands of jobs it has only been cuts in the lower single digit percentages of their workforce (I assume you refer to Sony and AT&T).

Of course it all adds up but what can companies do - either they act upon the down turn or hold their breath only to suffer massively unless the tide suddenly turns. And lets be realistic the tide is not likely to do that just now.


RE: Job cutting
By tastyratz on 12/9/2008 2:31:05 PM , Rating: 1
and what products will people buy when the businesses went out of business because they employed more than required?
The same could be argued that all these chapter elevens have "gotten out of hand"

The economy is down and it sucks for the people who get fired but they aren't doing this for fun, they are doing it to remain in business. I don't blame ANY company for layoff's right now. Sometimes you've just got to do what you've got to do.


RE: Job cutting
By KamiXkaze on 12/9/2008 11:11:07 PM , Rating: 2
Agreed you have to do restructuring or it is bye bye company.

AlX


Hopefully not the model job
By phxfreddy on 12/9/2008 7:17:30 AM , Rating: 2
I had a Japanese girl friend. This is the last thing they will cut. She will be tasked with flipping the light switch on the way out.




RE: Hopefully not the model job
By amanojaku on 12/9/2008 7:52:24 AM , Rating: 5
I'm pretty sure the models got "promoted up the ranks" and took "high-pressure" positions in "tight working spaces" with occasional "team interaction."


By AnnihilatorX on 12/9/2008 10:19:23 AM , Rating: 2
Damn give this man a 6


employees being let go
By Dreifort on 12/9/2008 8:46:24 AM , Rating: 3
As long as the girls in the photo (and other scantaly clads women) keep their jobs to promote Sony products, I'll be a sucker and buy the PS4.




RE: employees being let go
By mmntech on 12/9/2008 11:26:35 PM , Rating: 2
If they have to be let go, I'll give the second one from the left a good home. :)


Wow
By foolsgambit11 on 12/9/2008 2:34:01 PM , Rating: 2
I can think of 4 jobs they definitely shouldn't cut.... [looks back to picture]




Sony cuts 9000 jobs
By JonIscream on 12/9/2008 9:15:19 AM , Rating: 1
Sony doesn't manufacture anything in the USA, does it? Do any of the people they will be firing buy US goods or services? If not, ask yourself why we are reading this. What part of your life is this recession fear supposed to take control of?




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