Sony Unveils Its Apple iTunes Competitor
Sony has announced that they are planning on launching their own Apple iTunes competitor which will be an online store selling music, movies, and books as well as other downloadable applications for mobile products. This does sound very familiar, as Sony has already tried to compete with iTunes on the Sony Connect product which is no longer in existance. Sony’s top executives didn’t specify when the Internet store, tentatively called Sony Online Service, would go live or what it would look like. But the online storefront, announced at a management strategy meeting in Tokyo, is likely to bear some similarities to Apple’s iTunes store and would be Sony’s most ambitious attempt to link its products to its own vast library of digital content.
Current Chairman and CEO Howard Stringer has been set the mission to for a cohirant software strategy since taking over the top job in mid-2006.
The global recession has pummeled Sony’s businesses and left its earnings in a shambles. With consumers cutting back on electronics, Sony says it’s heading for its second straight loss. This fiscal year through March 2010, Sony predicts an operating loss of $674 million, from last year’s $2.6 billion loss. Sales are expected to slide 6%.
Sony executives refused to say how much it plans to invest in the new online service. Kazuo Hirai, executive vice-president for networked products and services, said the service would be based on Sony’s PlayStation Network. The Web-based gateway for PlayStation 3 video game consoles has been Sony’s most successful push into online commerce so far. Launched three years ago, the PSN has 33 million registered users and sells thousands of downloadable games, TV shows, and movies. This fiscal year, Sony expects the service to bring in $500 million in revenues, triple the previous year’s total. Last month, Sony signed a deal with Netflix that lets PS3 users stream movies and other content through the gaming console. “There’s some debate as to whether all PlayStation Network users would migrate to the new service,” Hirai said. “We would target quite a few of them.”
Will this new online store save Sony and get them back on track to the revenues of previous years? Will this also mean that Sony will remove their music from iTunes in the aim to get users to quickly adopt their new service?
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