News & Trends

Sony is selling off VAIO PC business to focus on mobile

Japanese giant Sony plans to sell it Vaio PC operations to an investment fund, cut 5,000 jobs, and revises full-year forecast from a profit to a loss of $1.1 billion. It will also spin off its TV business. The deal is expected to be completed by the end of July, and JIP’s new company will initially focus on selling VAIO-branded computers in Japan; it plans to hire between 250 and 300 Sony employees for the venture. Sony is investing 5 percent of the new company’s capital.

Sony Vaio Logo

VAIO, a brand which has variously stood for Video Audio Integrated Operation and Visual Audio Intelligent Organizer, was introduced in 1996 with the PCV desktop line. Sony has expanded it through the years to encompass wild designs like the tiny VAIO P and entries in the ill-fated UMPC category, as well as more recent products like the VAIO Pro ultrabook and VAIO Tap hybrid.

The company says it’s no longer designing and developing PC products, while manufacturing and sales will wrap up after the company’s final VAIO range goes on sale globally. It has decided to focus on those post-PC products (yep, smartphones and tablets), meaning that it had to make some big decisions with less successful parts of the business. During Q3 2013, it saw “significant profit improvements” compared to the same period last year. Sony saw year-on-year sales increases from its mobile arm, but still forecasts an annual loss of around $1.1 billion (110 billion yen) for the full year: it had previously projected a 30 billion yen profit. The blame is leveled at the businesses its now looking to change. Other highlights include the PS4, which sold 4.2 million units and 9.7 million games in its first six weeks. The games arm also saw a “dramatic increase” in PlayStation Plus subscriptions — something that’s mandatory for multiplayer on the company’s new console.

Sony will cut a total of 5,000 jobs worldwide (1,500 in Japan) by the end of the 2014 fiscal year, while the new PC company has stated that it will hire around 250 to 300 Sony employees, encompassing design, development manufacturing and sales, and will be based in Nagano — where Sony’s current VAIO HQ resides. The company is promising to fulfill all its aftercare warranties. Sony is signed up to invest 5 percent of the new company’s capital to support its launch and smooth over the transition. Restructuring costs across both the TV and PC segments are now set to cost an extra 20 billion yen. Sony is now set to focus on its high-end sets and 4K screens, and hopes that changes will ensure the TV business returns to profitability within the next financial year.


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