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TOKYO : Sony Corp. president Ryoji Chubachi has admitted the company should have taken swifter action in a crisis over defective batteries as the firm moves to trim losses elsewhere by shaking up its games unit.
"The company should have investigated the cause of the battery problem more quickly," Chubachi said in an interview with the Mainichi Shimbun daily published on Friday.
"The worries over the batteries spread as a result," he said.
As many as 9.6 million Sony-made lithium-ion batteries are being recalled by computer makers including Dell, Apple, Toshiba as well as Sony itself because of fears they could overheat and catch fire.
The company was forced to set aside 51.2 billion yen (448 million dollars) to pay for the battery recalls in a heavy blow to efforts by its first foreign chief executive Howard Stringer to get the iconic company back on its feet.
Sony's bottom line was also hit by losses in its games unit due to the cost of rolling out the new PlayStation 3 which has been hit by production shortages and stiff competition that forced the company to slash the price in Japan.
But Chubachi rejected the view that the company's technical prowess was on the decline, saying: "That's not the case at all."
"We had troubles as we tried to meet the demands for larger battery capacity and also to develop a new production scheme to cut the cost of PS3," he said.
"Either way, it was a process of challenges, still showing the Sony spirit."
Sony on Thursday said that Ken Kutaragi, known as the "father of the PlayStation," would give up the day-to-day running of the games unit which is sliding deeper into the red.
Kutaragi, 58, will remain chief executive of Sony Computer Entertainment (SCE) and also become its chairman.
Market players welcomed the reshuffle, with Sony's share price gaining 40 yen or 0.9 percent to 4,620, outperforming a 0.29 percent rise on the Tokyo Stock Exchange's benchmark Nikkei-225 index.
"Sony has long treated SCE as a kind of non-profit organization ... because of the strategically important position of the game business," Societe Generale Asset Management analyst Akio Yoshino said.
"And at this point, it remains to be seen if the management changes can make SCE an ordinary company, with its emphasis on making profits rather than continuing to treat it as a cost centre," he said.
The electronics giant expects its game division to make a loss of about 200 billion yen (1.7 billion dollars) this fiscal year to March.
Sony refuses to say exactly how much it has spent on the PS3 but admits that it will initially lose money on each console after spending hundreds of millions of dollars on new technologies used in it.
- AFP /ls
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