Sony cannot compete with the market

Sony has been constantly climbing the ladder down as compared to Apple and Samsung. Sony has been a pioneer in the electronic industry but since the past few years its popularity is declining amongst the masses resulting in a decrease in shares. The only popular product that Sony has to offer is their gaming consoles; these consoles can thus be considered their prime source of survival in the industry. Losses have been reported for Sony where the company only managed to make a small profit in fiscal year 2013 whereas 2011, 2012 and the last trimestral only resulted in losses. This has made the structure of the organization weaker resulting in doubts regarding the survival of this organization.

Five year analysis

For the past five years, Sony experienced approximately 5% decline in their revenue whereas the net income is slacking more. The net income dropped 35% annually in these five years whereas Apple grew its revenue by 39% and its net income by about 50%. Moreover Samsung has also been fairly successful by increasing their revenue by 44% and net income by 40%. This indicates that Sony is nowhere near its competitors where both companies (Apple and Samsung) have flourished and captivated Sony’s market to a great extent.

Moreover the miserable performance of Sony can also be judged by comparing the stocks returns with Apple and Samsung. Apple and Samsung stocks have appreciated tremendously over the previous half decade. The stocks of Apple and Samsung appreciated 400% and 200% respectively but Sony’s stocks depreciated by 37%.

Sony's potential in the years to come

As said too many cooks spoil the broth in my opinion Sony can fight back to regain its previous position by dividing their divisions into distinct companies. This would allow them to concentrate on each segment individually giving the attention they deserve. For instance, PlayStation would focus only on gaming consoles; its movie department would limit themselves only to movies and so on and so forth. This would encourage them to concentrate on one thing rather than everything. If Samsung or Apple buys any of these struggling sectors from Sony in might be fruitful for both the organizations.

Conclusion

It will not be wrong to say that Sony itself did not do much to fight back but it is never too late. Accordingly to leaked information Sony will likely go through a break up in the coming year because the worth of its individual sector is far more than the organization as a whole. Sony still has some great projects up its sleeves such as the Spiderman movies or other potential music artists. Considering this it is advisable that investors should look into the matter, analyze and wait for better opportunities that might come their way.

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