Sony Computer Entertainment has confirmed that the PlayStation division is currently involved in the review affecting the wider Sony business

Sony announced this morning that it will axe 8000 jobs and reduce investment in manufacturing, although SCE would not detail whether those cuts will have a direct affect on the PlayStation group.

"In order to stay competitive in the accelerating global network environment, we will always carefully review and make structural changes, if necessary, in order to further expand and strengthen the PlayStation business around the world," said Sony Computer Entertainment in a statement.

Sony said today that its electronics division has been affected by the current economic downturn, and it plans to downsize or withdraw from "unprofitable or non-core businesses."

However, some believe the announced measures won't be enough to help the company, with one analyst stating that Sony needs to prove which parts of the company are going to achieve profits in the future, rather than reduce headcount.

"The number sounds big, but this staff reduction won't be enough," said Katsuhiko Mori, fund manager at Daiwa SB Investments, to the BBC.

"Sony doesn't have any core businesses that generate stable profits - the next thing we want to see is what is going to be the business that will drive the company."

http://www.gamesindustry.biz/articles/playstation-division-under-review-as-part-of-corporate-changes

@celine

I think the part where it says "in order to further expand & stregthen Playstation business" CONFIRMS SONY isn't dropping out of PS business or anything crazy like that.

Never said that. However the "revision" could hit Computer Entertainment division too.

@kowenicki

the PS brand is too big to just die like this.

Its sold so many consoles over the year......something SEGA which went never did.

There will be a PS4....n this time their business model will be different.

If there's a PS4, their business model needs to be radically different. They can't rely on third party exclusives or graphical advances any longer, unless their competitors screw up badly.

SCE needs an overhaul and a change in philosophy at the very least. They're up against fierce competition.

The ps3 isn't selling that well.  Games are selling even worse.  The games are why they want people to buy the console.  There will probably be a ps4, but I wouldn't bet money on it.  Sony severely screwed up this generation.  Their managers were arrogant and completely incompetant.  Maybe they will release a ps4 with a different business model.  However, unless a change of management occurs, i'm not getting my hopes up.

Wht do they contradict themselves?

first:

"Sony Computer Entertainment has confirmed that the PlayStation division is currently involved in the review affecting the wider Sony business"

"although SCE would not detail whether those cuts will have a direct affect on the PlayStation group."

It makes life more difficult than it sould be.

Anyway, from http://www.gamesindustry.biz/articles/sony-to-axe-8000-jobs

they mention

"The company will also close two of its overseas manufacturing sites, including one at the Dax Technology Center in France, with the aim of reducing its plant operations by 10 per cent over the next 15 months - specifically in LCD and mobile phone technology areas."

I don't think they'll totally axe the gaming/PS3 division - just restructure it, but I'm 100% positive that the games division better wake up soon

These are all troubling news. IMO there's no doubt the exchange rates have had the biggest immediate impact on Sony, but as has been mentioned, they are not the only problem they have. One additional problem they might have somes from the Japanese business culture and the tight relations they have with their subcontractors, meaning that it is not as "easy" to cut or terminate these contracts. If there's anybody with first hand knowledge of Japanese business culture, I'd love to hear more how these things are handled in times of economic downturns.

Anyway, Sony seems to have a strategy where the consumer electronics, SCE and movie and music studios all play along and strengthen each other, and they are in a unique position to do that, quite frankly. That causes some problems because they can't just cut off some parts of the whole equation without severe ripple effects to the other parts of the business. For example, getting rid of the movie parts would be a blow for the Blu-Ray, and for downloadable content to PS3 and some TV-sets. In the end, they might lose almost as much money in lost sales as they were to save by cutting costs.

IMO Sony has a rather good strategy in place, but the implementation has not been up to par. Perhaps this crisis will help them really focus on their strategy, and if they do so and are succesful, it's all for the benefit of the customers who can enjoy their Sony products that much more. On the other hand, with the 30% reduction in new investments and R&D, they might not have the necessary resources to pull it off.

Nothing is going to happen to the gaming division, especially when it consists of 240 million consoles sold and 5% of the work force being cut.

Maybe you're right.

To me it just seems odd that something can be confirmed and yet at the same time not confirmed.

I'm probably just reading it wrong though