Sony cutting Smartphone target again? already? Loeb sells all Sony stock.

[JamaicameCRAZY]

nanarchy said:

JamaicameCRAZY said:
Ok so Sony announced they were going to sell x amount of phones. Then they say we arnt going to hit that mark so we are going to reduce it. Then they say we need to reduce the number of different phones we make so they reduce the number again and this comes as a shock to everyone? Fact is if you reduce the number of different types of things you make odds are your going to have less sales. But the key is (hopefully) you become more profitable. Which is what sony needs to focus on. Synergize the company. Reduce the number of unnessisary products they make. And ensure you are selling all of them for profit.

It isn't that simple, they made investments and estimates based on those reduced product lines (those predictions were insanely high as many here stated at the time they were made), this doesn't magically turn into more profit, it turns into a larger loss as the investments have been made and the returns are far smaller than expected. Sony are woeful when it comes to estimating sales and seem to always go for the most optimistic high end of possibilities, it is a really bad practise as it can make even a relatively good set of numbers look bad and creates business models were over investment occurs.

I dont know where this reply is going. They stated they were reducing the low end phones they make and focus on only higher end phones.

By doing this they can potentially not canabolize the sales of higher end models, they can focus on advertising all of their products because their is less of them (thus they should do better), they wont have the R&D for serveral different types of devices, they can then hopefully then better predict their sales.

Now as i said before the total sales should go down as they wont be selling as much however they should be able to maximize their profits.