It’s tough being skipper on a sinking ship, not least because el capitan is expected to go down with the ship. And, like at any other top position, the buck stops there.
So, when looking at a company like Sony, which is now only worth a quarter of its $100bn market cap peak many years ago, where else would the blame fall but with the head honchos? When you add the fact that Sony’s market cap has shrunk by half during the six year tenure of its first non-Japanese and current CEO Howard Stringer, the list of possible scapegoats narrows.
Sony’s issues are as complex as the company is gigantic.
Analysts still foresee significant revenue growth from its CyberShot digital camera and PlayStation video game segments, according to Bloomberg. In addition, its Blu-Ray media format is gaining traction, unlike some of its previous format missteps (anyone remember Betamax and Minidisk?)
The weak link happens to be its Bravia TV segment, which has lost ground to Korean electronics giant Samsung and discount HDTV maker Vizio, a newer player in the market.
“Flat-panel TVs now are fundamentally a commodity product… The Vizios of the world came in and cut prices so dramatically to where it made it hard to compete,” Tim Bajarin of Creative Strategies told Bloomberg.
Samsung is now worth $118bn and is now the world’s number one TV maker, reports Bloomberg.
Sony has also long been left behind in the portable music industry, which it dominated for decades with its Walkman cassette and CD players. Apple has since ridden the iPod wave to become the third largest company by market cap.
“My generation was willing to pay a premium for that brand… They were innovators. They had quality, and they had consumers. But the rest of the world has caught up to them. I’m not sure what their edge is anymore,” said Jack Ablin of Harris Private Bank.
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As the Turbo Chart shows, the company has underperformed the broad market over the last year:
Wall Street analysts, it seems, aren’t too concerned about the company’s outlook. As a group, they have a “Moderate Buy” rating on the stock.