A Financial Study of Sony and Microsoft Corporations
Abstract
The reason I chose to the Sony and Microsoft Corporations for my final project/financial comparison is because both of these companies have had a large impact on my life and others a vast many others in a huge. The reason I chose to compare their video game departments specifically (Sony Playstation 2, Microsoft Xbox) is because just 7 years ago Sony entered the videogame market knowing little about it - the proceed to dominate the market for those number of years - and now Microsoft is entering the market as a new competitor.
Two years previous to 1995, Sony and Nintendo announced their plans to develop a video game CD add-on for Nintendo's hugely popular SNES. Unfortunately for Nintendo, a year later they announced their cancellation of the project with Sony and their continued development of it with Phillips-Magnavox at the largest and most popular video gaming event of the year - without telling Sony first - E3 (Electronic Entertainment Expo. Sony then proceeded to produce their product into certainly one of the most influential video game systems of all time; one that has dominated the video game market for the past 7 years, and Sony is the only company so far that has done this with two consecutive systems like others failed to do - Playstation and Playstation 2.
Now Microsoft has entered into the video game arena, for its one of the only video game facets they had not explored. On the pc, Microsoft is a leading developer of games, but as everyone knows home console video games are vastly different. They have a different fan base; gamer's look for different kinds of games, different modes, different ways of gameplay etc. So Microsoft, having the huge pocket it does, began development on what they said was going to be the most powerful (at least graphics wise) hardware for any game system to date. As a new competitor Microsoft certainly has its work cut off, it faces the challenges that Sony did, not to mention the leading company currently has had a year release head start, amongst other issues.
Being first a huge fan of video games, and secondly a senior editor for two video game websites - www.mygamer.com / www.gameunt.com - I have a huge interest in the video game market, and its progress in today's world. There are three major competitors in the market today (Sony, Microsoft, and Nintendo - Gamecube), these two have the most in common - in terms of their beginnings in the market - and they should prove to be the most interesting comparison between the 3.
Overview of the Sony Corporation
The main office of the Sony Corporation is located in Shinagawa-Ku, Tokyo Japan. Sony manufactures and sells electronic machines/equipment, medical instruments, optical instruments, audio-visual software/components, computer software programs, metal industrial products, chemical industrial products, ceramic industrial products, textile products, paper products, wood-crafted articles, daily necessities, real estate, along with construction, transportation, publishing, printing, advertising, insurance, broadcasting, recreation, travel, and financial businesses.
The company name "Sony" was created by combining two words. One is 'sonus' in Latin, which is the root of the such words as 'sound' and 'sonic'. The other is 'sonny' meaning little son. The words were used to show that " Sony" is a very small group of young people who have the energy and passion toward unlimited creation.
History:
World War II effected the lives of the world in unchangeable ways, and it was from this destruction that many companies first established; Sony was among them. In the September of 1945, Masaru Ibuka returned to Tokyo from the war looking to begin work in the war-damaged capital, and restore it to its previous condition. Ibuka bought a section/workshop of a department store in the city in which he and his few employees works. The shop began as a repair shop - called Totsuko - but quickly progressed into something much larger.
The first problem with the city was that people had no way to connect or listen in to the news - and what was happening in it - for the rest of the worlds. Many peoples radios were broken, and Ibuka with his shop began repairing peoples radios to hear. After about a year, they saw another problem in the society with cooking rice, Ibuka created that better way with the electric rice-cooker. The progress continued increasingly as the continued to repair and build rice cookers a long with electrically heated seats in 1948. In 1949 Totsuko began research on a new technology they were developing, a magnetic recording device.
This tape device was making waves in the Japanese community because it allowed for a new way of recording sound. From there they made frequent visits to the United States to explore expansion opportunities. After a consistent development of these new tape recorders, Ibuka and his crew decided to make radios with the purchase of a transistor patent from a company name Western Electric. After a few years Totsuko began making radios much smaller than their component counterparts. They eventually began making pocket it radios, the first of which name the Sony TR-63 for 39.99.
In 1957 Totsuko had changed the name of its company because it felt that their Sony brand name would help further support and bring press to the company. It was a highly controversial issue, to change the name of the company to the brand name it produced, but after the change Sony's business went through the roof, with new radio technologies, video recording techniques, the worlds first transistor TV (1960), first color TV (Trinitron - 1968) amongst a vast amount of other things - these were the beginnings of one of the most influential technology companies to date, this all began a legacy that's still running strong and will never be forgotten.
The company name "Sony" was created by combining two words. One is 'sonus' in Latin, which is the root of the such words as 'sound' and 'sonic'. The other is 'sonny' meaning little son. The words were used to show that " Sony" is a very small group of young people who have the energy and passion toward unlimited creation.
Organization/Key People:
The Sony Corporation is basically split up into sections so that it can handle different regions and different products in the same and different locations. Stemming from the Sony Corporation are: SCE (Sony Computer Entertainment Inc.), SMC (Sony Music Entertainment Inc), SPE (Sony Pictures Entertainment Inc.), SPDE (Sony Pictures Digital Entertainment Inc.), and regional variations of each. The development of the Playstation 2 games in the U.S. is done be SCEA (Sony Computer Entertainment America, division of SCE).
Each separate part of the corporation has an attributing CEO. At the head of the Sony Corporation in general are the, Chairman/CEO, Nobuyuki Idei, and President/COO, Kunitake Ando. For the Sony Corporation of America the heads are the Chairman/CEO Howard Stringer, and Executive Vice President/CFO Robert Wiesenthal. At the head of Sony Computer Entertainment Inc. is one of the most well renown names in the video gaming world President/CEO Ken Kutaragi.
Sony Currently has 18,845 number of employees as of March 31, 2001.
Ownership:
There are currently three billion six hundred million (3,600,000,000) shares of authorized stock to be issued by the Sony Corporation currently - one hundred million of which are to be used for Subsidiary Tracking Stock. There are currently only nine hundred twenty-two million seven hundred sixty and one (919,688,001) shares of stock issued by Sony Corp today; that's with 733,918 number of shareholders. The par value of one share of stock in Sony Corporation (SNY) is 50 yen (40 cents) - one unit of stock is tantamount to 100 shares. As of the first half of first half of 2001, about 38.7% of the companies stock was held in by foreign institutions - mostly the U.S. The Japanese financial institutions held 27.1%, and the people there held another 27.7% of the total stock while the rest is head by other Japanese security firms and corporations. Sony was listed in the New York Stock Exchange on September 17, 1970.
The chairman of each division act as the directors of the share holder meetings, and the resolutions of a general meeting of shareholders is adopted by a majority of votes held be the attending shareholders.
Product Mix:
Sony's product mix spans a large number of areas, specifically in the electronics departments their major products consist of:
Audio: MD systems, CD players, headphone stereos, personal component stereos, hi-fi components, radio-cassette tape recorders, tape recorders, IC recorders, radios, headphones, car audio, professional-use audio equipment, audiotapes, and recordable MDs.
Video: 8mm/Digital8-, DV-, and VHS- format VTRs, DVD-Video players, digital still cameras, broadcast-and professional-use video equipment, and videotapes.
Televisions: color TV, projection TV, flat panel displays, personal LCD monitors, car TV, and professional-use-monitors/projectors
Information/Communications: Computer displays, personal computers, computer peripherals, data media, IC recording media, satellite broadcasting reception systems, telephones, car navigation systems, and video printers.
Electronic Components/Other: Semiconductors, LCDs, electronic components, CRTs, optical pickups, batteries, FA systems, video game systems, and an Internet-related business in Japan.
Trademarked names include: Vaio, Walkman, Trinitron, Wega (pronounced Vega).
Price/Promotion/Place:
Sony uses these three things in unison with each other, the first let the product determine a general operating cost, then as they select the place, the promotional technique changes to fit that location exactly. In the U.S. Sony has its own American divisions for its companies, and within those divisions lie regional sections.
Since the company builds its own manufacturing plants their price determination is much more direct to the specific product, and manufacturing costs.
Sony uses many types of promotion including; discounts coupons, catalogs, demonstrations, hi-tech displays in stores, contests, word-of-mouth techniques, public relations, magazine reviews and ads, along with a great number of push and pull strategies.
Subsidiaries:
Sony Currently owns a large number of subsidiaries, major ones including: Aiwa Co., Ltd, Sony Chemicals Corporation, Sony Semiconductor Kyushu Corporation, Sony Computer Entertainment Inc., Sony Marketing Co., Ltd., Sony Manufacturing Systems Corporation, and Sony Broadcast Media Co., Ltd.
Overview of the Sony Corporation
The main office of the Sony Corporation is located in Shinagawa-Ku, Tokyo Japan. Sony manufactures and sells electronic machines/equipment, medical instruments, optical instruments, audio-visual software/components, computer software programs, metal industrial products, chemical industrial products, ceramic industrial products, textile products, paper products, wood-crafted articles, daily necessities, real estate, along with construction, transportation, publishing, printing, advertising, insurance, broadcasting, recreation, travel, and financial businesses.
The company name "Sony" was created by combining two words. One is 'sonus' in Latin, which is the root of the such words as 'sound' and 'sonic'. The other is 'sonny' meaning little son. The words were used to show that " Sony" is a very small group of young people who have the energy and passion toward unlimited creation.