Another great year for electronics, says Sony president

Forget the mortgage crisis...give me an LCD TV, say American consumers.

Despite intense competition, price cuts and a shaky economy, it's going to be another good year for the electronics industry, predicts Sony's Stan Glasgow.

Glasgow, president of Sony Electronics, said that orders from retailers are strong once again this year. Consumers are snapping up high-definition TVs, but also digital cameras and video cameras. Sony's gaining ground in notebooks too: shipments are up by double digits, he said. Sony lost seven days of production out of its San Diego area factory because of the fires in the region (some right near the factory); the company, however, has already made up for the lost time.

"It could be the best holiday season in the last couple of years," he said. "I'm judging it by the orders we have."

Sales have been strong the last few years too, so what gives? People might be spending more time at home, he theorized, which in turn might be prompting electronics sales. Home improvement projects are up. Movie ticket sales are down. Vacation travel might be down, he speculated.

Consumers also know that regular TV is going away.

"I still think the biggest thing going on is the analog shutdown in 2009," he said.

For its part, Sony is trying to participate more broadly in the market than in the past and is using different engineering tricks to do so. This year, for instance, Sony came out with some less expensive TVs for Wal-Mart Stores and a few other big box retailers. To get these TVs to the price points they wanted, Sony bought off-the-shelf components from third-party suppliers. The LCD screens inside these TVs, for instance, were not from the Samsung-Sony jointly owned LCD factory.

Other notes from Glasgow:

--Sony has released a slim 11-inch OLED TV in Japan, but it will take time for the technology to become a mass market phenomenon. "The yields are difficult. The technology is difficult," he said. Blue light, in particular, can be difficult to control on OLED TVs. "It is going to take a number of years" before OLED TVs become mainstream," he said.

The company is also examining different types of light sources for LCD TVs. A few years ago, the company came out with a somewhat expensive TV illuminated by LEDs. It got removed from the market. Others have since adopted LEDs. Although Sony continues to look at LEDs, Glasgow said there are types of light sources "between" LEDs and traditional florescent light sources.

--Expect the Japanese giant to be more open to outside ideas. Sony has said this for years, but this time they really mean it. The latest Sony Reader and some of its MP3 players come with slots for SD cards as well as cards based around Sony's Memory Stick standard.

"We're going to get away from this proprietary thing and go open format," Glasgow said.

--The U.S. wing of the company will start to have more influence on Sony overall. Recently, Sony's U.S. execs took some of their Tokyo counterparts on a tour of Silicon Valley. They visited venture firm Kleiner, Perkins as well as YouTube. The U.S. divisions will also have more autonomy when it comes to designing products for the American market.

"We're looking to put more engineering power here to technically translate what the marketing people tell us what consumers are looking for," Glasgow said.

--Blu-ray will win. But I guess you expected that. Sony is one of the big backers of the Blu-ray format. The rival format, HD DVD, has given close to $500 million in "incentives" to get studios to back it, he asserted. Executives at Panasonic, however, have said that the studios have been asking the Blu-ray powers to cough up some marketing dollars as well.

 

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