How Sony Fell Behind

by Christopher Paul on April 15, 2012

Hiroko Tabbuchi writing for the NT Times:

“Initially, Sony engineers resisted the power of the company’s media divisions. Then Sony wrestled with how to build devices that let consumers download and copy music without undermining music sales or agreements with its artists. The company went its own way: its early digital music players, for instance, used proprietary files and were incompatible with the fast-growing MP3 format.

By the time the different divisions had been corralled into cooperating, Sony had lost its foothold in two crucial product categories: televisions and portable music devices. It was late to flat-panel displays, as well as to digital music players like the iPod.

The company still makes a confusing catalog of gadgets that overlap or even cannibalize one another. It has also continued to let its product lines mushroom: 10 different consumer-level camcorders and almost 30 different TVs, for instance, crowd and confuse consumers.”

This is very reminiscent of the American car companies in the 70’s and early 00’s, respectively. The big three were slow to respond to smaller, fuel efficient cars from Japan and sales dropped rapidly; by the time they had smaller cars out there, it was too late. And in the early 2000’s, the big three went through it again – but this time it was due to, in part, overlapping models. Ford’s Mercury was an odd hybrid of it’s low cost cars (Ford) and their luxury cars (Lincoln). GM had Pontiac, Oldsmobile, Geo, and Saturn.

It’s really a case of one company getting drunk off their own successes and refusing to see change as it happens let alone predicting it.

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