Sony to open its first new smartphone factory in 20 years, selling off mobile business clearly not in the plans

Sony to open its first new smartphone factory in 20 years, selling off mobile business clearly not in the plans
Despite being stuck with a small market share as it struggles to drive profits, Sony Mobile is adamant about fighting to stay alive in the business. Perhaps a little background is in order, so there you go — by the end of the company's first fiscal quarter, June 30, Sony Mobile suffered an operating loss of $188 million and revenue decline by 16.3%, caused by "significant decrease in smartphone unit sales", among other problems. Sony actually considered the option of selling its unprofitable mobile business, like it did with the VAIO line of laptops.

But, following the storm of "Sony Mobile may call it quits" headlines, CEO Hiroki Totoki affirmed that Sony Mobile won't ever sell or exit the current mobile business, which is very much what fans of Xperia handsets wanted to hear. Yet, nothing says "yeah, we're doing this!" like opening up the company's first smartphone factory in 20 years!

Asian business publication Nikkei reports that Sony is investing "several billion yen" in equipping an existing site in the Pathum Thani province, Thailand, with an end-to-end production system covering chip mounting through assembly. Its gears will be set in motion in fiscal 2016, with initial output set to reach several million units a year.

The last time Sony built a mobile communications factory was in 1995 in Beijing, China, with Sony owning a 51% share and the reast spread between three local partners. The new Thai factory is fully owned by Sony, which will allow for faster decision making.

While Sony will be enjoying its new stronghold in Thailand, competitor HTC sold off its smartphone factory in Shanghai this year. The site was built in 2009, costing about $32.2 million. The factory, which has a working area of around 147 square meters, used to operate at double capacity back in 2010, when HTC was riding a wave of success. It went on to be acquired by an undisclosed Chinese manufacturer.

Hopefully, Sony will also consider upping its marketing efforts. Although the company does enjoy the kind of brand recognition its rivals Samsung, LG, and Apple boast, thanks to its historical presence in the consumer technology sector, not that many of the folks that know about Sony TVs and Walkman players also know about its Xperia smartphones. With the kind of entertainment assets the company owns, one would expect Sony to leverage movie and music content exclusivity, while spending more on advertising in general, to propel its smartphones futher into the market.

Yet, as many as five generations of Xperia Z smartphones later, Sony still has weak ties with US carriers other than T-Mobile, and mostly limits its advertising to television campaigns. While having secured the Japanese market and having an audible presence in the United Kingdom, Sony Mobile still has much work ahead in establishing the Xperia brand globally. What's clear is that the company isn't giving up on its ambitions anytime soon.

source: Nikkei via Xperia Blog

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50 Comments

3. sip1995

Posts: 1771; Member since: Feb 07, 2014

Don't know whay but Sony somehow became the new "Nokia".

8. Omarion07

Posts: 34; Member since: Jan 13, 2015

I don't think so.. Nokia was a telecommunications company and all its revenue is generated from telecommunications.. Sony on the other hand have invested in loads of businesses.. So if their mobile department f**ks up it can receive some back up from the cash flow generated by the excellent ps4 and imaging sensor sales.. That's my assumption

13. tacarat

Posts: 850; Member since: Apr 22, 2013

9. Omarion07

Posts: 34; Member since: Jan 13, 2015

I don't think so.. Nokia was a telecommunications company and all its revenue is generated from telecommunications.. Sony on the other hand have invested in loads of businesses.. So if their mobile department f**ks up it can receive some back up from the cash flow generated by the excellent ps4 and imaging sensor sales.. That's my assumption

22. maherk

Posts: 6637; Member since: Feb 10, 2012

They ll be the new Nokia if they decided to ditch Android for Windows, until then, they aren't even close. Sony is heading towards the right direction with the new Z5 lineup, they got almost everything you want in a phone, and probably in one of the best designs in the market. They just need to release it in more markets and cut the 6 months cycle. After my horrible experience with the Xperia S, I never considered giving any Sony phone a try, but the Z5 is really tempting for me to pass

39. Omarion07

Posts: 34; Member since: Jan 13, 2015

I have the z5, and before that I had z3 compact.. To me the z5 is just awesome and an improvement over the z5 in literally everything apart from the battery life.. It's still great like compared to other flagships but it's not as good as the z3 lineup.. Hopefully battery life will improve with a new software update.. I'd definitely recommend it!

40. maherk

Posts: 6637; Member since: Feb 10, 2012

I am curious about the sot you're getting?

43. Omarion07

Posts: 34; Member since: Jan 13, 2015

I'm getting that good good stuff

4. obsidyen

Posts: 37; Member since: Feb 18, 2015

They need to make their own SoCs and also develop their own OS. Android is not the future.

10. joey_sfb

Posts: 6794; Member since: Mar 29, 2012

Like a PlayStation Phone and TV? Too little too late. I bought their Sony Android TV and love it. It replaces all my other media streaming boxes. Just turn on the TV and all the contents are available on a single voice activated remote.

18. Djz89

Posts: 420; Member since: Aug 25, 2014

that is a very big risk ATM,

44. boostedDroid unregistered

Please do tell us what IS the future, Miss Cleo!

5. FReDcc

Posts: 73; Member since: Jun 11, 2015

Sony isn't going anywher.Yay!

6. bugsbunny00

Posts: 2251; Member since: Jun 07, 2013

well maybe we'll be seeing z6 next year, who knows.Go Sony,..

15. Chuck007

Posts: 1409; Member since: Mar 02, 2014

Good! If they can match GS7 spec for spec I'd seriously consider the Z6 even if I have to wait a couple more months. Go Sony!

16. Chuck007

Posts: 1409; Member since: Mar 02, 2014

Speaking of Sony mobile, did anyone notice how the Z5 home button gives a significantly cheaper/"flimsy" feedback compared to the Z5 Compact? Doesn't make sense why Sony will drop the ball like that.

19. mixedfish

Posts: 1542; Member since: Nov 17, 2013

How does one virtual on screen button feel more 'flimsy' than another virtual on screen button?

24. kent-gaga

Posts: 609; Member since: Apr 10, 2012

you mean the power button? yes I feel that tooand it's a little too "deep" to comfortably press, especially when you place it on a tablet

28. Chuck007

Posts: 1409; Member since: Mar 02, 2014

Yeah meant the power button/fingerprint scanner.

34. kent-gaga

Posts: 609; Member since: Apr 10, 2012

and taking screenshot by holding down the power button + volume down is a pain in the @ss damn it Sony, there's always something wrong with your Xperia phones

29. buccob

Posts: 2944; Member since: Jun 19, 2012

Sony phones have On Screen Buttons, so the "Home" button is a virtual one, and the feedback would be similarly the same... If you mean the Power button, that's a different thing

17. Djz89

Posts: 420; Member since: Aug 25, 2014

you know what? i am so sick of these rumors, i will just wait and see. I wish them the best of luck in the future. One week : sony is selling it smartphone buisness, next day :ceo rolls back on sony selling it SPB, And then sony is buliding a smartphone factory, i bet 3 days go by and again: sony is planing to close the factory they fought about buliding... Please, if you dont know, dont write....

20. imnotascammer

Posts: 160; Member since: Aug 22, 2012

I really think Sony could make it. As this article said, they have a brand recognition like Samsung and Apple does, they only need to flex their arms a little bit.

25. hanabi

Posts: 177; Member since: Oct 08, 2015

If only Sony gives up their pride from the past, and lower the price to compete with other Chinese phones... They should give up fighting against apple samsung lg and focus on mid-range with huawei xiomi lenovo

36. ogee4life

Posts: 105; Member since: Apr 12, 2014

They don't need to give up fighting apple and samsung when they are better innovators and tech experts. They have just been poor in branding their mobile products. I agree though they should have a few cheaper products to cater for the mass market like the Chinese do, but what is paramount for them is to cut down the number of phones or models they release yearly. They shouldn't have more than 5 models released yearly in mobile, A flagship model i.e The Z5, the compact version and a premium version or phablet. Then a mid budget phone and a low budget phone, that makes it 5 models released yearly which is more than adequate. Sony just need to restructure its business and strategy and then market heavily globally and they'll be back with a bang

26. ninja_master

Posts: 306; Member since: Feb 27, 2015

I think hallyu aka supernova is crying in his basement

30. Djz89

Posts: 420; Member since: Aug 25, 2014

who care what that twat of a troll is doing.... hopefully your right :P

27. luabin

Posts: 36; Member since: Jul 29, 2012

Now shut the fvck off Phonearena. U dont know whats really going on with sony. Sony is here to stay! Thats a fact. Btw how did samsung or other phone manufacturer paid you to say things biased to Sony?. Truth will prevailed.

50. discharge unregistered

You suck and your Sony you pozer douche nozzle!!! Sammy note 5 will eat you and Sony alive and spit you out like vomit of heavy drinking!!

32. ryq24

Posts: 872; Member since: Oct 17, 2011

Maybe sony knows something we don't ? Whatever! Good luck! I am a Sony user and so far they have to improve their quality. buying such an expensive phone only to return it after two weeks make one very disappointed and angry.

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