Sony, who in Australia is struggling to hold onto market share, is set to announce a record $1.3 billion dollar quarter loss on Friday. This is tipped to be worse than the record loss recorded for the previous fiscal year.

The Company whose executives still believe that Sony is a premium brand, are now having to face up to the stark reality that consumers have a different view and are deserting the brand in droves, in favour of products from Apple, Panasonic Sony and LG.

In Australia the Company has had to contend with falling market share in the HD TV, digital camera and camcorder markets as well as in the portable music, Blu ray and up untill last month in the gaming market.
Sony also has to change their marketing strategies as more and more of their products are no longer made in Japan, instead the Japanese Company that built its name on the back of the “Made In Japan” quality statement is now having to move to third party manufacturers in China, Taiwan and Malaysia in an effort to cut costs.

 Sony who was already been struggling to turn itself around when the global financial crisis hit has seen market share eroded around the world. Earlier this week in the US it was revealed that their market share if the flat panel TV had slipped from 19.6% to 14.3% while both LG and Samsung have seen their market share at the expense of Sony.

In recent weeks there have been a few bright spots, such as the recent price cut for the PlayStation 3 that boosted the console’s sales to a million globally in just three weeks. In Japan, government-backed discounts for energy-saving gadgets, including flat-panel TVs, could help them lift sales, while in Australia the Company has resorted to giving away PS3 gaming consoles and three year warranties in an effort to compete with BMW cars, TV and free home theatre kits from their competitors.

Sony is projecting a 120 billion yen ($1.28 billion) loss for the fiscal year through March 2010. That would be worse than the 98.9 billion yen fiscal loss recorded for the previous fiscal year, the company’s first red ink in 14 years.


Kazuharu Miura, analyst at Daiwa Securities SMBC Co. in Tokyo, expects Sony to do better than its own forecast for the full year, although it will continue to stay in the red. Recent price drops on flat-panel TVs have been lower than expected, although unit sales may be falling short, he said in a recent report. “Closely being watched are Sony’s views on its flat-panel TV, digital imaging and gaming businesses,” he said. “It has been difficult to gauge its medium-term growth scenario.”

Recently Chief Executive Sir, Howard Stringer announced a new management team in an effort to fix his Companies problems.

If Stringer fails to deliver within 12 months, several leading analysts are tipping that he will be dumped.

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