Sony has always been regarded as a reputable company when it comes to its camera sensor business, and this has been one of its most profitable divisions. And now it seems that the Japanese company wants to coordinate it separately from the rest of its divisions.
A possible reason for this split is the fact that Sony’s mobile and TV businesses haven’t proved to be as fruitful lately, while its imaging sensors are in high demand, being used in top of the line smartphones. Thus, by making its semiconductor division independent from mobile and TV, it will allow them to become even more competitive in this segment. Sony said the following:
“The aim of these measures is to ensure clearly attributable accountability and responsibility from the perspective of shareholders, management policies with an emphasis on sustainable profit generation, and the acceleration of decision-making processes and reinforcement of business competitiveness. The decision to establish Sony Semiconductor Solutions forms part of this strategy.”
And it makes sense when you think about it. The semiconductor division is indeed one of the most profitable departments of its electronics business, and by making it separate from the rest, it will allow Sony to have a broader look at its strengths and weaknesses, thus allowing to come up with even better products for the mobile market.
According to Sony, the divisions that handle semiconductor manufacturing and design, Sony Semiconductor Corporation and Sony LSI Design, will become subsidiaries of the newly formed company. Sony’s storage media operations will fall under manufacturing arm Sony Storage Media and Devices Corporation, and the battery business will fall to Sony Energy Devices Corporation.
Sony will invest a further $374 million this year to increase production capacity and they also have plans to expand into the automotive segment in the near future, as well.
This move seems to be part of CEO Kaz Hirai’s strategy to make Sony more efficient by separating its businesses. We’ve already seen the company take other similar actions, such as the disjunction of the Vaio brand, the split of Bravia TV division and then spin off its audio and video business. And now the company is applying the same strategy in a field where it’s currently market leader.
Sony isn’t a traditional tech company, as it also has a huge business in motion pictures and music and more recently, even financial services. Therefore, it’s no easy job to keep everything arranged, efficient and as profitable as possible. So by making certain divisions operate on their own, inside their own cells, Sony hopes that it will manage to keep its giant business very well structured.