In essence, back in 2000, he was telling Ando they should make a smartphone. Ando disregarded that suggestion, perhaps viewing the PHS – or “personal handy phone system” –installed on the CLIE as adequate for email or web browsing. The failure to thrive of the PHS, which was developed by NTT Laboratory and launched commercially in 1995 in Japan, is well known. PHS cell phone services, with their limited range and meagre roaming abilities, are being phased out, having long since lost out to GSM.
By 1999, Sony had developed a product similar to an MP3 player, in essence a prototype of the iPod, which Apple introduced in 2001. Sony failed to bring its own players – a memory stick version of the once wildly popular Walkman and a Vaio music clip – to market because they received unfavourable reviews, both in-house and externally, and because its music division objected. Sony’s personal audio company and its Vaio Co developed the two products separately, without any cooperation or communication, says Chang. By the time Sony released its new “Network Walkman” in 2004, the sleek and shiny iPod was already a hit and MP3 players had become mainstream products.
“Since Sony owned a music business and was far more sensitive to illegal copying and sharing digital music files than Apple was, it made the Network Walkman incompatible with the MP3 format,” Chang writes in his book. Meanwhile, Sony’s involvement in music and other content, meant to be a strategic asset, is actually hindering its product development, says Tomoo Marukawa, a professor at the Institute of Social Sciences at Tokyo University. “This may be the biggest reason why it is not coming out with new, bestselling products,” he says.
The music player problem also illustrates the difficulty of conflicting or competing interests between Sony divisions, which do not communicate or coordinate well on executing global corporate strategies, says Cavender. “So there is not much sharing of technology or marketing platforms on the sort of message going to consumers. They do not do well cross-selling products, whereas Samsung’s different divisions do manage a bit more,” he says.
