02 September 2008

Crossed lines at Sony Ericsson!??

There is lot of buzz over the past few weeks that venture between Swedish Ericsson and Japanese technology giant is on the end, mainly because of the disappointing product launches and bad financial results.

If Sony CEO Howard Stringer has little faith in the company's joint venture with Ericsson, investors must be concerned about the companies' mobile-phone strategy.

In an interview with German newspaper "Welt Online", Howard Stringer, CEO of Sony suggested that there were difficulties emerging between the two camps.

When Sony and Ericsson merged as Sony Ericsson, Sony brought its design and media competence into the new venture while Ericsson brought is technical know-how and both together created some exciting phones, except the not so successful Symbian-based UIQ smartphone line.

The venture is more important for Ericsson, facing sluggish growth at its core business of supplying wireless network equipment. Sony Ericsson contributed 23 per cent of Ericsson's total operating income last year.

Anyway, it looks like Howard Strigner isn't happy with the current situation of Sony Ericsson and while he hasn't mentioned to either leave the joint venture or to take it over, the interview shows that he's thinking about Sony Ericsson's future:

Welt Online: In some areas you are in joint ventures. With the mobile phone manufacturer Sony Ericsson it does fluctuates downwards. Wouldn't it time to separate from Ericsson ?

Stringer: Certainly it was a difficult year, but it's never easy to buyout a partner.

Welt Online: So you think about it?

Stringer: One of the most important features in the digital age is to be quick, and it's difficult to be as quick in a joint venture like in your own company. You are always in discussions and negotiations. We constantly discuss with Ericsson how to make Sony Ericsson as successful as possible.

Welt Online: Will Sony Ericsson be there in three years?

Stringer: We need to cooperate as we did two years ago. Or the joint venture has to find its own solution.

Welt Online: That was diplomatically.