There is no question that Sony is suffering badly. With natural disasters, manmade disasters, and cut throat competiton hitting the bottom line at Sony. It isn't all that shocking that the stock has plummeted over six dollars in the past few months. Investor confidence has been severely shaken. This could mean that there is the potential for another asset sell off in the near future. To return the company to a profitable state. Well at least that is what 24/7 Wall St. thinks about this situation. They recently released their top ten list of brands that will disappear this year, and Sony Pictures is right there in the number one position. They are betting that Sony is going to sell, and bring in some needed cash.

Which brings me to seeing the good in a bad situation. Having to sell off chunks of a company is always a bad sign. However when something is sold there is a lot of something gained. That being a good amount of discretionary income. Which can be used to reinvest into electronics development. There is some precedent for Sony doing this historically, and needless to say the PS3 has been a major beneficiary of sell off booty. So that brings me to a quandry about if there is a selloff, and Sony pours most of the money into the gaming. Where would that money most likely be spent.

Lets say that for the sake of debate that Sony sells off Sony Entertainment a couple months from now, and Sony Computer Entertainment gets a two billion dollar allowance to spend on their product line. They can spend that money any way they like on any product they like. Were you them what would you spend that money on, and be mindful this isn't about how to win a ficticious console war. This is about making a division healthier so it can make more money for the parent company.

Please do not attack the premise this is purely theoretical, and it isn't even remotely out of the realm of possibility anyway. Sony sells off a number of assets just about every year. So it isn't even out of character for the company. Just share your ideas as to what would be the best use of a two billion dollar windfall, and please back up your idea with some kind of explanation. I kind of want to see where the thinking is leaning, and here is a link to the inspiration for this thread.

http://247wallst.com/2011/06/22/247-wall-st-ten-brands-that-will-disappear-in-2012/2/

@ClassicGamingWizzz

Unfortunately it will probably be written off as such. That most certainly was not my intent. Sadly the community is probably still too shell shocked to tolerate anything that is moderate. Either it must be overly negative or it has to be overly positive. Which is leaving the important things to fall right into the chasm unnoticed. We are in a generational pause at the moment. This generation isn't over just yet, but the consensus is that the next generation will be fully unveiled in a years time. So this is the period where manufacturers are putting together their future plans. What will dictate those plans is largely a question of bank. It is fundamentally the most relevant question.

Prior to this generation Sony had serious bank. With loans, and sales of assets they were able to generate probably in excess of four billion dollars. Beyond that they had the previous console generating serious income. The result however was still severe financial losses. Right now Sony needs to be building a nest egg if it intends to compete at the same level as Microsoft next generation pound for pound, and to overcome Nintendo with its head start, and new found willingness to court hardcore gamers.

Right now it is a problem without an answer. Sony cannot repeat this generation again, and not just due to losses they incurred on the front end. They do not have the cash up front that it would require. This always brings the discussion to an impasse. There are optimists who insist anything is possible, and then there are rationalists who insist that the numbers aren't adding up. That is what this thread is about.

The potential for Sony to have a windfall that will allow for significant up front investment, or current investment, or any number of things changes the equation. I am not talking about a worst case scenario. I am talking about a best case scenario. How is it Sony is doomed if I am talking about Sony getting a shitload of cash to spend which will allow them to improve their game.

I can't imagine Sony selling off Sony Pictures anytime soon, given their involvement in the creation of Sony's 3D cinema cameras and with Spider-man coming next year.

"and then there are rationalists who insist that the numbers aren't adding up. That is what this thread is about" "Sony cannot repeat this generation again" its about stating the obvious? "numbers aren't adding up" for what another playstation? sony have already confirmed it to be in development

"Sadly the community is probably still too shell shocked to tolerate anything that is moderate" im not really sure thats the reason looking at it i'm not really sure what the point of this thread is and i suppose other people are having the same problem... we already know that sony can't repeat the ps3 again ( in the same way that microsoft themselves cannot release a console for $600 ) they already confirmed that but we also know that playstation 4 is in development so it stands to reason their strategy has changed 

@Makingmusic476

I would like to wholeheartedly agree with you. However the speculation is fairly consistent with past behavior on the part of Sony. The company is electronics centric to a fault. This wouldn't be the first profitable division that would have been sold for the sin of not being part of the core business. Most of them have actually been fairly profitable for Sony. Absolutely it flies in the face of logic to invest in unprofitable divisions by selling off profitable divisions.

I suppose there is a logic that electronics offer greater long term profit potential. However with lower labor costs, and built in almost immediate obsolescence. I am not seeing a large market for premium high end electronic devices. Well at least one where Sony is likely to gain dominance any time soon. What can I say I cannot see it, but that doesn't mean that Sony doesn't see whatever it is.

Anyway the source is citing two reasons for selling Sony Pictures. The first being a result of market pressure, and the second being that the asset is expendable, because it is not a core business for Sony. That isn't necessarily illogical as I pointed out above. I confess to being kind of torn about whether it is just stupid, or so stupid as to be possible. Out of curiosity if you had to council Sony to sell a large asset which one would your recommend as a good sale for Sony.

@o_O.Q

I think you are missing my point entirely. I am not saying that the next console isn't in development. I am saying that at this point in the development cycle choices are being made that reflect the current economic situation. The PS4 design is probably more constrained by limited cash flow then it otherwise might be if more cash was available. This is needless to say problematic depending on what the competition decides to do.

Microsoft is a loss leader like Sony is a loss leader. Lets say for arguments sake that both intend to release a console that is priced at four hundred dollars, but Microsoft intends to sell their console at a hundred dollar loss. While Sony intends to sell their console at a fifty dollar profit. With weak financial backing Sony isn't exactly in a position to do much about the disparity. Microsoft is going to sell a superior machine for the same price.

Now that doesn't mean that Sony only has one option to match the hardware, but they must be competitive. They could sell at a substantially lower price. Perhaps offer features that Microsoft will not. Maybe increase the value of their console by including new games. There are choices here, but only if Sony has the resources to use them.

Right now Sony is financially constrained, and that means technically they have fewer options. I want to know in what way those options would change if the gaming division at Sony received a significant inflow of cash. How would it change the design of their next console. Would they opt to reinforce the current console. Would it be better to invest in software. I am removing the doubt of financial capability with this hypothetical scenario. Sony is getting an even playing field by having more money to spend.

Impressive Dodece, like the old days you still write a university level essay for every response

I like it!

Sony Pictures has been meh really....but recently Bad Teacher has opened very well in the US and Spider-man is coming next year.

That article also included Sony Ericsson. I think they would dump Sony Ericsson sooner than their Pictures.  I am surprised you didn't even mention that in the op.  They have 2 brands in that article.  "Sony Ericsson’s unit sales dropped from 97 million in 2008 to 43 million last year."  -Seems like they are doing pretty piss poor in the phone department.

"Sony Ericsson management expects several more quarters of falling sales and the company has laid off thousands of people. There have been rumors, backed by logic, that Sony will take over the operation, rebrand the handsets with its name, and market them in tandem with its PS3 consoles and VAIO PCs." - I don't even think rebranding the handsets with its name and marketing them in tandem with PS consoles/ Vaio PCs will even do much.  I expect this brand to slowly fade away into oblivion.  Probably best thing for them to do is just sell it off.  Who knows maybe they can make a comeback but if they can't even outsell HTC then good luck.

Uh uh! I'll play along! 2 billion dollars is dumped in SCE's lap for whatever reason, and I think they would try to do something along these lines with them.

1) Acquire an extra development studio (or start a new one from scratch possibly). They would probably try to go for a studio is good at doing games that attract a wider audience, like Mario Kart or Just Dance. That's the most glaring ommission in Sony's lineup I can think of at least, they've got a few games that tries to that, but nothing is really working.

2) Invest some money in the Vita. Maybe by adding more functionality (through software) or doing bigger ad campaings (when it's released of course). Not to mention trying to get it out as fast as possible.

3) Invest in some third party exclusives maybe? Or just throw them at the PS4 R&D?

"This is needless to say problematic" why? having an underpowered console didn't stop sony from winning 2 gens and nintendo from winning this one? you seem to be implying that sony needs to have a console with cmparable power at the same price point to win a gen and that just isn't true of any of the console manufacturers most of the time it has been the underpowered console that sold more although i do admit that things have changed in comparison to those gens

"Microsoft is going to sell a superior machine for the same price. " well i heard people saying the vita because it was so technologically advanced had to cost more yet its going to retail for the same price as the 3ds... although i do agree that the scenario you pointed out is likely for now its simply speculation

"if the gaming division at Sony received a significant inflow of cash" but isn't it obvious? didn't you just say it yourself if they were in a better position they would release a comparable console or a more powerful console than microsoft but obviously at this point in time they may have to cut back... thats common knowledge