The figures behind Sony’s decision to remove the Ericsson name from its new mobile phones has been released as it is revealed Sony Ericsson lost £173 million during the final quarter of 2011. A net loss combined with a fall in revenue has led some analysts to put the blame at Android’s door.
Sony has unveiled its first smartphone after it dropped the Ericsson name. The Xperia S was revealed at the Consumer Electronics Show in Las Vegas. It’s the first of their new NXT Xperia range and is an impressive and powerful device marking a statement of intent for Sony as they seek to extend their position in the smartphone market. While Sony Ericsson’s Xperia range was impressive it was not able to compete at the top level of smartphones, those like the Samsung Galaxy s2 and iPhone 4S. Increased competition hit their sales figures as they were down 16% year on year. They shipped nine million phones which was a 20% decrease and they blamed competition and price erosion.
It is a common argument amongst mobile manufacturers as while more companies want to secure their position and be all things to all consumers, and the market continues to grow in the UK, it hits firms hard if they can’t keep up. HTC and Motorola Mobility both say that during the fourth quarter they found it difficult to compete. The success story was Samsung whose Galaxy range remains to keep them on top. A strong franchise along with numerous licensing and technology patents helps them to keep creating top of the range devices. Samsung also has a close relationship with Google. Its last device of 2011, the Samsung Galaxy Nexus, was the first to run Ice Cream Sandwich, Android 4.0, highlighting how much each rely on each other.
Samsung is, however, developing a new operating system along with Intel. Google has taken over Motorola which could have an influence on Samsung and Google’s relationship.
For mobile manufacturers struggling, the continued dominance of Apple continues to hit hard. After the launch of the iPhone 4S Apple embarked on a staggered global launch of the device and, when Apple releases their sales figures in the coming week, is expected to reveal 30 million devices have been sold.
Sony announced at the end of October that it would buy out Ericsson’s 50% share in Sony Ericsson. The deal will be finalised later this month which explains why the Xperia S handset bears simply the Sony name on its front. Competition in the smartphone is set to continue as popularity grows, particularly in the UK. While high street shoppers have become used to seeing famous store names disappear in difficult times as mobile manufacturers get more savvy and have a greater understanding of what consumers want, perhaps people shopping for new mobile phone contracts will start to see the same thing in 2012.