Sony Cellphone

Paper Summary:

In late 1999, following a year that was characterized by a number of damaging product introduction delays, the residual effects of an earlier recall of 60,000 phones, reduced sales and increasing levels of intense competition in the marketplace, Sony closed down its cellphone production operation in North America. The paper shows that in order to remain competitive, Sony took a realistic look at the market, divested itself of operations in an area where it could no longer profitably compete, took advantage of outsourcing some of its manufacturing needs by means of the vehicle of utilizing outside contract manufacturing operations and further reduced costs associated with development by entering into a joint development agreement with Ericsson of Sweden. The paper looks at Sony's move in the context of the cellphone market in the United States, provides a product description and uses the Porter Five Forces Model to explain the forces that shape competition within an industry.

From the Paper:

"The Japanese digital cellular telephone market clearly foretells what cell phones, service and technology will look like in the future?worldwide. Whereas a few short years ago, when a cellular telephone rang in Japan, people would have to speak very loudly in order to be properly understood. Such is no longer the case. Today, instead of speaking on the phones, users are reading email, checking calendars, reviewing weather forecasts (and baseball scores), playing games, downloading text and sending messages. With the music-related innovation detailed above, users will soon be able to also have the strains of their favorite music with them as well. In essence, at least as far as Japan is concerned, this new phone has become the equivalent of the personal computer with wireless connectivity but with much more stringent design constraints (Yoshida, 2000)."

More papers on Sony Cellphone:

• Essay # 24110 : "Sony Cellphone"
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• Business Plan # 32625 : "The SONY Corporation"

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