@EaglesEye379:

Yes, Samsung is in a good position to put the hurt on Sony now. Check out the Korean Won vs USD / Euro charts, the USD and Euro have strengthened against the Won so they're able to cut or at least maintain prices. Not to mention Yen to Won (it has doubled), which means Samsung can perhaps even gain market share in Sony's home turf.

As for OLED, it will probably remain in the background for many more years.

8000 jobs = 5% of workforce

Sony's problems can hardly be attritubed to currency,...not to say currency doesn't have a negative impact on their current problems, but it is riddiculous to say it's currency causing a comapny to slash 8000 jobs and cut production by 10%. The problem is a poor margins on products being produced, and I'm surprised Stringer hasn't been sacked yet. Sony is getting beating in every sector of the high end electronics market, and brd was susposed to be it's golden goose laying those eggs. Walkman is torched by Ipod, PS torched ny Wii and 360, brd won, but is stalled, hdtv's are flooded by a host of other brands, cameras are crowded...so sony doesn't have a core business. The Spider-Man franchise really boosted Sony's bottomline this entire decade, but the next film is too far away.

@heruamon:

Say you were making $1 profit on each $100 of revenue. Suddenly you start receiving $80 for the same products (replace $ with your favorite currency). Where do your margins go?

Profit margins and currency fluctuations go hand in hand as EaglesEye379 said.

PS: Yes, I know there are mitigating factors in that some expenses are paid in $/€ too, but still...

Gaming division is certainly safe - it's a core of sony together with movie division and tv/audio ones.

And with PS3 costs projected to break even in 2009 SCE will be profitable again.

But yeah they are not going to sell underpriced consoles anytime soon. So we might say good bye to price cuts till they can significantly drop cost of making ps3 and share them with consumer.

I was also under the impression this is a longer term benefit, that the commodities are often bought on longer term contracts not enabling a quick response to market changes.

Now bloomberg is saying 16,000 job cuts instead (including 8,000 contract workers).

http://www.bloomberg.com/apps/news?pid=20601087&sid=aiP0oocLk1KY&refer=home

All the job cuts are still confined to the electronics division though.

Well, not all the foreign currency expenses are commodities, Sony also has plenty of workers abroad. Besides if the commodities are paid in dollars, the savings in Yen terms will be immediate in that area...

awh man :(

I hope this doesn't mean no more Sony Rolly, that little thing is awesome

@heruamon

Foreign exchange changes are playing a big part in Sonys books right now due to the nature of their business. These usually can be weathered through but its the last thing Sony needs right now so it certainly adds to why downsizing is happening.

If you have time, check out their presentation on their recent earnings releases, particularly pages 6 and 8
http://www.sony.net/SonyInfo/IR/financial/fr/08q2_sonypre.pdf. A big reason of decreasing income is due to foreign exchange changes.

The gaming division carried SONY for 12 years....now it can't do that.

I think they should just release like 5 Spiderman's at 1 time n get this problem over with/...lol