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SonyEricsson In Trouble?


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Old 24-03-2009, 18:24
prking
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Interesting article in Mobile Industry Review. SonyEricsson's own figures show a predicted loss for the first quarter of $450m and a drastic drop in sales to 14m handsets for the quarter. (This is very much worse than Nokia, LG, Samsung and even Motorola). Reported as being caused by buggy handsets and a top heavy range featuring more expensive models.

Sony was reported last week to be seeking underwriters to back a buyout of Ericsson, if it fails then its likely that SE will close.

So are we seeing the end of SonyEricsson or will they rise triumphant?
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Old 24-03-2009, 19:55
jammers
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Their product mix is all wrong as they have chased market share over profitability. SE made some fantastic phones like the T68, T610, the original cyber shot phones like k750. However more and more phones launched are just repackaged stuff that they already sell - a Nokia strategy if ever there was one.

Before the iPhone I only owned Ericsson or Sony Ericsson phones but in the last 18 months their product launches have been basically crap. Average selling price of SE phones has plummeted to £110 per phone because they now chase the low end where margins are thin - the Dell of the phone world.

They need to re-evaluate and go back to what they did best - high end, feature packed phones ahead of the competition. Stop worrying about market share and start worrying about making money.

Such a shame - the Ericsson T39 is still one of the best phones I ever had.
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Old 24-03-2009, 20:27
prking
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One point picked out is that whilst the selling price of SE phones have dropped the cost price hasn't (Due to overheads like the high return rate). To the extent that each handset sold is costing them a $36 loss.
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Old 25-03-2009, 07:13
blueacid
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Well, I had 5 Sony Ericsson phones in a row; T68, P800, K750i, K850i... but now moving on to get a Blackberry instead.

...Why? Well, the K850i's been disappointing, and the C-series now looks basically just to be the same as the K850i before. Just the same phone software with an ever so slightly better camera bolted on, but nothing much else new. Plus the constant freezing and crashing of the K850i has made me decide to move away.


I would suggest that considering also the iPhone and other smartphones that are released, their higher end customers see no reason to remain.
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Old 25-03-2009, 18:28
simonb65
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Many moons ago I used to work in the Ericsson factory in Worksop. Saw many good phones in production there (GH388, T18 & T20 amongst others). Since they moved manufacturing overseas I stuck with Sony Ericsson phones, K750i, K810i. However when I upgraded last month the only one that tempted me was the C905 but I ended up going for the T mobile G1.
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Old 25-03-2009, 19:16
magikmax
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I had a disastrous experience with a K800i. There was clearly something corrupted within the internal memory that kept causing the errors, but all SE were prepared to do was reinstall the software. The joystick went faulty several times, as did the loudspeaker. Three seperate faults on one phone, not good.

I currently have a SE W880i, which I have had for 1 year so far, and I've had one corruption problem, in that I tried to switch themes on the phone, it wouldn't let me, then things started disappearing on the existing theme, until I could not access the menu at all. At this point, I lost all my games, phone numbers, texts etc.

A software refresh fixed the problem, and nothing funny has happened since, but given all the problems with their latest range of handsets, I'm not getting another one. Going for a Blackberry next, which will better suit my requirements. It's a pity, because personally, I think the W880i is a lovely phone, nicely crafted and feature packed for its size, but there's just nothing in their range that interests me at the moment.
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Old 26-03-2009, 16:00
linkinpark875
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Sony Ericsson's use to suffer minor joystick problems but now it's screen and ear piece failures. Just poor build quality handsets the last two years. The C905 feels cheap and mine has broke three times plus long waiting times on repairs.

If the phone doesn't work I have to look at Samsung or LG which offer far more advanced and reliable phones.

Sony Ericsson has lost it's cutting edge. There new touch screen will fail bad as the Samsung Omnia HD is out on the market before it and a better phone. LG have a range of cheap touch screen models so people will go with them. The 12MP thing I can't see taking off people know now pixels mean nothing.
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Old 26-03-2009, 16:09
iRuss
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SE made some fantastic phones like the T68, T610,


Surely some mistake!!!
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Old 26-03-2009, 16:13
Gazz380
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In a period when bad earnings news and guidance warnings have become commonplace, some releases are worse than others.

The announcement this morning by LM Ericcson ADR (ERIC) that its joint venture with Sony (SNE) for the marketing of mobile phones will post significantly lower results for the first quarter than had been expected has been greeted with alarm.

Sony Ericcson has projected that first quarter sales will drop to 14 million units, down from 24 million in the fourth quarter. The joint venture is now projecting a loss of $465 million to $533 million for the quarter.

Sales of the Sony Ericcson mobile phones have been affected by declining consumer demand throughout the world. Company revenues have also been adversely affected by the global financial crisis and the reduction of inventories at wholesalers and retailers.

Of even greater importance, however, has been the decline in market share as competitors Apple (APPL), Research in Motion (RIM) and Samsung have captured more consumer interest with their I-phone systems.

Sony Ericcson is projecting a 42% decline in phone sales for the quarter, double the decline forecast by most analysts. Many analysts are looking at a downgrade of their recommendations as a result of the guidance.

The dismal prospects for the company in 2009 and beyond have given rise to concerns about viability. The joint venture began the year with a cash balance of 1.125 Euros, or about $1.4 billion. Losses for the first quarter and for the balance of the year will likely reduce available cash by half.

If the losses continue at the projected level Ericcson will be faced with a choice of either withdrawing from the partnership or infusing additional cash so that the joint venture can continue to operate.

Stockholm based Ericcson has had greater success competing for wireless communications systems installations in China, where it was recently awarded the contract for the installation of third generation Wireless Code Division Multiple Access System (W-CDMA) in fourteen China provinces. The value of the contract has not been released.

Ericcson is the global leader in the delivery of technology and services to telecom operators. While the difficulties with the joint venture with Sony are irksome, Ericcson's balance sheet is not likely to be adversely affected to any great extent.

At year end, Ericcson had current assets more than twice the size of the current liabilities and long term debt of less than 15% of the company's equity.
So there not in trouble just having a bad spell, they will be fine!
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Old 26-03-2009, 17:49
jammers
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Surely some mistake!!!
Not at the time - they were miles ahead of the competition.
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Old 26-03-2009, 17:50
jammers
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Many moons ago I used to work in the Ericsson factory in Worksop. Saw many good phones in production there (GH388, T18 & T20 amongst others). Since they moved manufacturing overseas I stuck with Sony Ericsson phones, K750i, K810i. However when I upgraded last month the only one that tempted me was the C905 but I ended up going for the T mobile G1.
T18 and T20 were great as well - had both of those.
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Old 26-03-2009, 17:50
jammers
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Well, I had 5 Sony Ericsson phones in a row; T68, P800, K750i, K850i... but now moving on to get a Blackberry instead.

...Why? Well, the K850i's been disappointing, and the C-series now looks basically just to be the same as the K850i before. Just the same phone software with an ever so slightly better camera bolted on, but nothing much else new. Plus the constant freezing and crashing of the K850i has made me decide to move away.


I would suggest that considering also the iPhone and other smartphones that are released, their higher end customers see no reason to remain.
That is spot on.
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Old 26-03-2009, 17:56
iRuss
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Not at the time - they were miles ahead of the competition.
They were NOT!!

The T68i was decent as it had bluetooth but 256 colours on the screen whilst Nokia's handsets at the time had 4,000 AND a built-in camera.

The T610, diabolical camera and a joystick which felt like it was held on with pritt stick.

In fact up until the very good K750i, all SE cameras were terrible and well behind Nokia.
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Old 26-03-2009, 18:01
prking
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So there not in trouble just having a bad spell, they will be fine!
That article you quoted says that Ericsson will survive, not that SonyEricsson will survive. In fact it presents a gloomier portrait of SonyEricsson than previous reports. Things are worse than I imagined. A loss of half a billion dollars in one quarter!
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Old 26-03-2009, 18:09
LTT
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I was waiting for this for a while.

I used to love SE phones, they just had that little extra that other phones didn't seem to offer, themes, a great UI but over time other manufacturers upped their game and SE no longer had that extra 'oomph'.

Add to this, restarting phones, software bugs and faulty hardware and this isn't a surprise at all.
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Old 26-03-2009, 18:58
jammers
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They were NOT!!

The T68i was decent as it had bluetooth but 256 colours on the screen whilst Nokia's handsets at the time had 4,000 AND a built-in camera.

The T610, diabolical camera and a joystick which felt like it was held on with pritt stick.

In fact up until the very good K750i, all SE cameras were terrible and well behind Nokia.
The Ericsson T68i was out well before the Nokia phone.

The T610 was not just about the camera - it was the software, the design, the whole package and was a class leader.

The T610 camera was the same as all the other camera phones at the time

I don't think you know what you are talking about.
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Old 26-03-2009, 19:35
iRuss
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The Ericsson T68i was out well before the Nokia phone.
You don't even know which Nokia I'm talking about.

It was out at the same time as the 7650. I remember because I was offered both.

The T610 was not just about the camera - it was the software, the design, the whole package and was a class leader.
Except if you wanted a phone with a good camera. It was blurry at the best of times and was the reason they changed the internal design and parts for the K700, leading on to the k750.

The T610 camera was the same as all the other camera phones at the time
Seriously, no it wasn't. The 6230 beat it hands down. The 3650 whipped it in to submission. The 7250i threw it to the ropes and clotheslined it the mat before pinning it for the 3,2,1.

I don't think you know what you are talking about.
Pot, kettle, black etc
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Old 26-03-2009, 19:47
jammers
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You don't even know which Nokia I'm talking about.

It was out at the same time as the 7650. I remember because I was offered both.



Except if you wanted a phone with a good camera. It was blurry at the best of times and was the reason they changed the internal design and parts for the K700, leading on to the k750.



Seriously, no it wasn't. The 6230 beat it hands down. The 3650 whipped it in to submission. The 7250i threw it to the ropes and clotheslined it the mat before pinning it for the 3,2,1.



Pot, kettle, black etc
The T68m was launched in the final quarter of 2001. The 7650 arrived in the arse end of the 2nd quarter 2002 - about 6 months behind.....

http://en.wikipedia.org/wiki/Nokia_7650

http://en.wikipedia.org/wiki/Sony_Ericsson_T68i

The phones compared with the T610 all launched well after the T610. The 7250 was out 3 months after, the 6230 was a whole 9 months behind.
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Old 26-03-2009, 19:49
iRuss
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You really think they launched on those dates around the world?

In 2002, after a slight cosmetic redesign and a software upgrade, the T68m was re-released as the Sony Ericsson T68i
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Old 26-03-2009, 19:57
goomba
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It was out at the same time as the 7650. I remember because I was offered both.
I had a T68 a fair old while before the 7650 was available. The was the only colour screen mobile on Orange when I got it.
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Old 26-03-2009, 20:00
iRuss
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I had a T68 a fair old while before the 7650 was available. The was the only colour screen mobile on Orange when I got it.
There's a difference between the T68 and the T68i, which is what he was on about.
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Old 26-03-2009, 20:04
goomba
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There's a difference between the T68 and the T68i, which is what he was on about.
Same phone, different colour case.
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Old 26-03-2009, 20:10
iRuss
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I don't think SE would have done to the trouble or launching a campaign for the T68i based on just a different case.

But if jammers meant the T68 then perhaps he should have said the T68...
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Old 26-03-2009, 21:35
jammers
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I said Ericsson T68 - I mistakenly put the i on the end instead of the m but as I said Ericsson and not Sony Ericsson I thought it would be painstakingly obvious.

The T68 was originally an Ericcson phone but Ericsson and Sony merged not long after - their first phone was the T68i which was identical to the T68 except for Phone case and updated software.
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Old 27-03-2009, 07:30
prking
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That debate shows how far SE have fallen, where is the buzz for a new handset? Its for the IDOU which won't be released until the end of the year. What they going to sale in-between? The T707?
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