Sony pays Ericsson $1.47B, takes over phone business

With the Sony Ericsson partnership becoming a Sony subsidiary, expect a tighter integration between phones and other Sony electronics and services.

Sony CEO Howard Stringer
Sony CEO Howard Stringer speaking at IFA in Berlin Stephen Shankland/CNET

Sony is ending a 10-year mobile-phone joint venture with Ericsson, buying out its business partner's 50 percent stake for 1.05 billion euros, or about $1.47 billion.

Through the deal, which had been rumored earlier this month, Sony Ericsson will become a wholly-owned Sony subsidiary, Sony said today. In addition, Sony will assume ownership for mobile phone patents and get other patent rights through a cross-license deal with Ericsson.

Consumers can expect a tighter integration between Sony's phones and the other main devices in the company's "four-screen strategy," said Sony Chief Executive Howard Stringer in a statement today.

"We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment," Stringer said.

The partnership linked Sony's electronics experience with Ericsson's telecommunications technology. Sony Ericsson, late to recognize the rise of a new generation of smartphones, now is a fervent Android partners with its Xperia line.

The two companies will continue to be partners through a new effort, though. Sony and Ericsson are "setting up a wireless connectivity initiative...to drive and develop the market's adoption of connectivity across multiple platforms," Sony said.

The patent deal, while not a surprise, could be helpful for Sony. A storm of patent-infringement suits sweeping the mobile marketplace right now, perhaps most notably pitting Apple, with iOS, against Samsung, a major user of Google's Android operating system.

Of this aspect of the partnership, Sony said, "The transaction also provides Sony with a broad intellectual property (IP) cross-licensing agreement covering all products and services of Sony as well as ownership of five essential patent families relating to wireless handset technology."

 

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