Sony is planning a new online store a la Apple's iTunes, but with a few twists.
Announced at a strategy meeting in Tokyo on Thursday, the new service will hawk music, movies, books, and other downloadable content geared for its various electronics, including TVs, mobile phones, music players, and computers.
The service, which Sony aims to launch next year, will link the company's devices and digital content that it produces--setting it apart from other online stores.
"That's the kind of combination that I think is not seen anywhere else," Kazuo Hirai, Sony executive vice president for networked products and services, said in an interview with the Associated Press. "That I think is where our core competence lies, and that's a differentiator for Sony."
Hirai also spoke about the new service with BusinessWeek, saying that it won't just sell products but also tap into social networking by letting people upload their own photos or videos and connect with each other.
"It's not just access content, stream it, and enjoy," Hirai told BusinessWeek. "What are your friends watching right now? There's a screen that says all the programming that's available. It highlights all the things that your friends are watching, for example. It's a community experience."
Called the Sony Online Service for now, it will model itself after the company's successful PlayStation Network, a free service that has captured 33 million registered users who download movies, access social networks, and grab games for the PS3 and portable PSP console. Hirai said that gamers will be able to access the new online service directly through their PlayStation Network accounts.
Of course, Sony has been down this road before in 2005 with its late Sony Connect music service. The aborted iTunes clone was done in by internal politics and a failure to connect with consumers, forcing the company to shut it down in 2007.
But with a new, more cohesive management team put in place by CEO and president Howard Stringer, Sony is hoping to avoid the in-fighting that helped kill Connect.
Sony needs a shot in the arm at this point. Though the company pioneered the portable music concept 30 years ago with its Walkman, it has struggled to compete in the Digital Age. Continuing a string of quarterly losses, Sony took a $292 million net loss in its recent second quarter. Despite cost cuts and layoffs, the company is projecting a total loss of $1.3 billion for the full fiscal year.
Continuing its string of quarterly losses, Sony suffered a net loss of 26.3 billion yen ($292 million) for its second quarter, reported the company on Friday.
Compared with a profit of 20.8 billion yen a year ago, this marked Sony's fourth straight quarterly downturn.
Sales for the quarter that ended September 30 also took a spill, dropping 19.8 percent to 1.66 trillion yen ($18.26 billion) from 2.07 trillion yen in the year-ago quarter.
Recent cost cuts and hot sales of the PlayStation 3 game console both provided a shot in the arm.
But Sony was hurt by a downturn in sales for the venerable PlayStation 2 despite its recent claim that the PS2 was "showing no signs of slowing down." Weak demand for the Vaio line of PCs also dragged down the quarter.
As a result, revenue in the Networked Product and Services division, which includes Sony Computer Entertainment, fell 24.2 percent to 352.6 billion yen from 465.2 billion yen in the year-ago quarter.
Other segments also upset the bottom line.
The Consumer Products and Devices business, which includes TVs and cameras, watched its sales plummet 36.5 percent to 799.9 billion yen from 1.25 trillion yen a year ago. Sales were down for Sony's Bravia HDTVs due to intense price competition and the higher value of the yen. The company's Cybershot digital cameras also were impacted by a decline in unit sales and the appreciation of the yen.
Lower sales both in the theater and at home hurt Sony's Entertainment division, with revenue down 30.4 percent to 136.4 billion yen from 196.1 billion yen in 2008's second quarter.
Sony Ericsson also affected the quarter with sales of 1.6 million euros ($2.36 million), a 42 percent decline from 2.8 million euros in the year-ago quarter. An ongoing drag on Sony's earnings, the cell phone maker has struggled to turn a profit in recent years.
One bright spot was Sony's music business, which enjoyed a 147 percent boost in revenue to 124.5 billion yen, stemming in part from sales of Michael Jackson's product catalog, following the entertainer's death in June.
Despite the quarterly loss, results narrowly surpassed expectations, prompting Sony to boost its forecast for the full fiscal year. The company now is eyeing a loss of 95 billion yen for fiscal 2009 versus its prior forecast of a 120 billion yen deficit. Sony lost 98.9 billion yen in fiscal 2008.
Sony recently announced that the PlayStation 3 will offer Netflix streaming, a move it hopes will bump sales of the game console even higher.
On Thursday came more signals from News Corp. that Hulu will charge for at least some of its films and TV shows.
Chase Carey, News Corp.'s deputy chairman, suggested in comments he made at the OnScreen Media Summit that it's just a matter of time before Hulu, the video service founded by News Corp. and NBC Universal, launches a subscription service.
"I think a free model is a very difficult way to capture the value of our content," Carey said, according to a report Broadcasting & Cable, which co-hosted the conference. "I think what we need to do is deliver that content to consumers in a way where they will appreciate the value...Hulu concurs with (the notion) that it needs to evolve to have a meaningful subscription model as part of its business."
Asked when Hulu would roll out its pay model, Carey, who has been to only one News Corp. board meeting since his recent arrival at the company, was less sure. According to Broadcasting & Cable, Carey thought the move would likely be made in 2010. He acknowledged however, that no timeline had been set.
Carey's comments follow similar statements made by other News Corp. decision makers, including Rupert Murdoch, the company's chairman. Murdoch has talked about charging for content at the online units of many of his media properties, including The Wall Street Journal.
If Hulu charges, it's a big deal. The video site, which offers full-length TV shows from NBC Universal, Twentieth Century Fox Film, and other top entertainment companies, is a pioneer. It's the first online ad-supported video service to successfully offer long-form content. If it retreats from the ad-supported model, then what consumers get is the cable business model transplanted on the Web.
And charging for content online may not solve Hulu's revenue problems. Subscription video-on-demand services have to compete with a score of sites that offer pirated content free of charge.
The reason that Hulu is considering a pay wall is presumably because the site isn't generating the kind of money the studios have grown accustomed to. Advertising experts have said that it's not possible to insert enough ads without ruining the viewing experience on one end and on the other, it's not possible right now to obtain the kind of ad rate that will generate big money.
It's interesting to note that while News Corp. appears to be dissatisfied with the ad-supported model, Sony Pictures Entertainment appears to be doubling down on ad-supported Crackle.
There isn't another major studio distributing as many full-length feature films online on an ad-supported basis than Sony Pictures. In February, Crackle began offering catalog film titles from its vast library on Crackle. Recently, "Taxidriver" made its ad-supported Internet debut.
Since Sony Pictures relaunched Crackle--formerly a user-generated video service--in February, the site's premium monthly streams have grown to nearly 10 million, 27 percent of which were in the site's core demographic (men, ages 18 to 34), according to statistics provided by ComScore. Time spent on Crackle has increased sevenfold in that period, to 13.4 minutes per unique session. In the core demographic, that number rises to 16.7 minutes.
Here's another benefit that Crackle offers Sony: the site will post premium films when they aren't under contract to a cable or broadcast TV station. Before Crackle came along, movies like "Taxidriver" would gather dust during the periods when they weren't being aired.
We don't know what kind of money is being made by Hulu or Crackle, but regardless of whether Hulu charges for its content, there is still hope for ad-supported movies and TV shows on the Internet.
(Credit:
Smarty Pants)
Kids may gobble up junk food, but it seems they love playing with Nintendo devices even more.
Out of the 100 most loved brands for America's children and tweens, the Nintendo Wii and DS scored the first and second spots, according to a report by research firm Smarty Pants.
The survey "Young Love" found that even tempting snacks like Oreos and M&Ms trailed behind the Nintendo gear, taking the third and fifth spots in the list, respectively. Other techie items loved by 6- to 12-year-olds included the iPod at number 12, Sony's Playstation at 14, YouTube at 36, and Microsoft's Xbox at 42.
Kids participate in more than $500 billion in consumer spending each year, according to Smarty Pants, and their parents consider their favorites when buying everything from snacks to entertainment, both of which popped up heavily on the list.
"From Crayola to iPod, kids' most loved brands are familiar, iconic brands that delight kids and parents with variety, value, family-friendly content, and simple pleasures," Smarty Pants President Wynne Tyree said in a statement. "Interestingly, the top brands are not traditional 'for kids only' brands; in fact, many are not marketed directly to kids."
To compile the report, Smarty Pants questioned 4,700 American kids and their parents online over a period of nine months. Covered in the survey were more than 260 consumer brands across 20 different product categories.
The brands that kids liked most, said SmartyPants, were the ones that offered high-quality family time, age-appropriate content, parent-approved indulgence, variety/choice, "cool" accessibility, and chatter-worthy advertising.
Sony Music Entertainment's catalog is coming to indie music retail site Amie Street, in the New York-based start-up's first major label deal.
But here's the catch: Sony's catalog will not be participating in the "dynamic pricing" model that's been Amie Street's trademark--unpopular songs are the cheapest, and the price rises as a song is downloaded more. Instead, Sony songs will be available for a flat 69 cents, 99 cents, or $1.29 based on popularity.
"It wasn't a hard decision for us," Amie Street co-founder Josh Boltuch told CNET News. "This isn't affecting all the other dynamically priced music on the site." He noted that RED, the indie music distribution company owned by Sony, already offers its songs on Amie Street through the dynamic-pricing model. "Sony Music obviously has the option to experiment with dynamic pricing at their discretion," Boltuch added. "Clearly we would love to do that with them."
This isn't the first time that an indie music retailer has had to compromise to ink a major-label deal. Sony was also the first major label to bring its catalog--well, its "classic" back catalog--to subscription site eMusic. But the deal resulted in eMusic raising some of its prices in tandem.
Amie Street, which pitches itself as a way to discover as well as purchase new music, made major headlines last year when it was the only place on the Web to buy songs recorded by Ashley Alexandra Dupre, the call-girl-slash-aspiring-pop-star at the center of the Eliot Spitzer scandal.
YouTube wants to offer movie rentals and is in talks with several top movie studios about obtaining licenses to stream feature films on a rental basis.
YouTube is discussing the service with Sony Pictures, Lions Gate Entertainment Corp., and Warner Bros. Studios, according to a story published Wednesday in The Wall Street Journal.
This is a natural progression for YouTube which has been engaged in a year-long campaign to secure more professionally made content. The Google-owned video company offers films on an ad-supported basis from Sony Pictures and MGM. YouTube declined to confirm or deny the Journal report.
One studio executive familiar with the talks downplayed the significance of the talks, saying no deals have been struck and the conversations are at best in the early stages. The executive pointed out that the studios have these discussions all the time and that there's a large host of services that already sell downloads or offer digital rentals, including Amazon, iTunes, Netflix, and Microsoft's Xbox.
"Why wouldn't the studios talk to YouTube?" the executive said.
There are also full-length films available to the public for free on ad-supported sites, such as Sony Pictures' video site, Crackle.com, and on Hulu.
But YouTube's U.S. audience is now over 100 million and the site's potential to generate big ad revenue from premium content is still not fully understood.
Sources in the film industry say however that if Google can prove it can protect streaming content from piracy and will offer a lucrative deal beyond just a percentage of ad revenue, there's no reason why YouTube can't be the Comcast of the Web.
Electronic paper is stacking up to be a high-growth market, according to a new report.
Sales of e-paper displays are projected to soar from $431 million this year to $9.6 billion in 2018, market researcher DisplaySearch said Wednesday.
The number of units sold is forecast to grow 22 million this year to 1.8 billion in 2018.
E-books are currently the main use and sales driver for e-paper. Most e-book readers, such as the Amazon Kindle and Sony Reader, use the electrophoretic display technology from E Ink. A few e-readers, such as Fujitsu's Flepia, use a different technology called cholesteric LCD. Fujitsu's device offers a color display but is more expensive than the Kindle or Sony Reader.
"E-paper displays are taking off with consumers due to their low power consumption and ease of reading, especially in sunlight," said Jennifer Colegrove, director of display technologies at DisplaySearch. "In addition, e-paper displays are 'green' because they reduce paper consumption."
The number of e-book readers on the market has risen steadily, starting with one model in 2003, three in 2006, five in 2007, and around 20 this year, notes the report.
Despite the visual appeal of Fujitu's color Flepia e-book reader, DisplaySearch asserts that the high price and technical challenges of color e-books will limit their sales volume until 2011. The more popular electrophoretic display technology is likely to continue to lead the market and generate sales of $5.8 billion in 2018.
But other display technologies are poised for growth, the report said. Electrochromic displays, most commonly used in windows and other glass products, will target the market for smart labels and card displays. By 2013, electrochromic displays will be the leading technology for e-paper displays, DisplaySearch is forecasting.
Another competing technology called MEMS (micro-electro mechanical system) is expected to shift its market from cell phone displays to color and medium-sized e-books over the next few years.
A three-judge panel ruled Friday that Yahoo will not have to pay up every time it plays a song on its Internet radio service, affirming an earlier verdict.
In what is being seen as a defeat for the music industry, Yahoo Music was not deemed "interactive" enough to require the company to negotiate with record companies for the rights to play songs over the Internet. Instead, according to Reuters, it merely has to pay licensing fees to digital music rights organization SoundExchange.
The suit arose way back in 2001, when a division of Sony sued Launch Media claiming the service was bypassing a law that requires those who provide specific playlists of songs over the Internet to pay rights holders. Yahoo also acquired Launch Media that year, but has since turned over control of the service to CBS Radio, a division of the same corporation that publishes CNET News.
Yahoo won the case in 2007, but Sony appealed, resulting in Friday's decision.
The $299 PRS-600 has an improved touch screen.
(Credit: Sony)After enduring a couple of rumors and leaks that took the lid off its latest e-readers a little earlier than it would have liked, Sony's officially announced the two new models: the Reader Pocket Edition ($199) and Reader Touch Edition ($299), both of which will hit stores at the end of the month. The other big news is Sony is going to match Amazon's e-book pricing, making new releases and best seller titles $9.99 instead of $11.99.
As for specs, here's what you're looking at:
Reader Pocket Edition (PRS-300):
- 5-inch E-ink electronic paper display
- Comes in blue, rose, and silver
- Resolution: 800 x 600 pixels
- Gray scale: 8-levels gray scale
- 440MB of usable internal memory stores about 350 standard eBooks
- Three adjustable font sizes
- Sealed-in battery provides up to two weeks of reading on a single battery charge
- $199 MSRP
- Protective neoprene sleeve and USB cable included
- Files supported: Adobe PDF (with reflow capability), Microsoft Word, BBeB, EPUB
Reader Touch Edition (PRS-600):
- Touch-screen panel (navigate with your finger or the included stylus)
- Comes in red, black, and silver
- Resolution: 800 x 600 pixels
- Gray Scale: 8-levels gray scale
- Take handwritten notes with the stylus pen or type with the virtual keyboard
- Notes can be exported and printed out
- Onboard Oxford American English Dictionary allows you to look up a word by tapping on it (Amazon's Kindle has always had a built-in dictionary, but this is new to Sony Readers)
- Five adjustable font sizes
- 440MB of usable internal memory stores about 350 standard eBooks
- Sealed-in battery provides up to two weeks of reading on a single battery charge
- Expansion slots for both Memory Stick PRO Duo and SD cards
- $299 MSRP
- Protective case (similar to the PRS-700's) and USB cable included
- Files supported: Adobe PDF (with reflow capability), Microsoft Word, BBeB, EPUB
Sony has also updated its eBook Library software to version 3.0, and it's integrated into the device itself (similar to Flip Video camcorders) and includes support for both Windows PCs and "many" Macs. Owners of the PRS-505 and PRS-700 should take heart that in the near future Sony will provide a firmware upgrade to both those models that adds the new eBook Library software to your devices and makes them Mac compatible.
Because Sony has dumped more than 1 million free public domain books into its eBook store, it's no longer offering its 100 free classics bundle with the new devices. It's also worth mentioning that unlike the Kindle, Readers are compatible with the formats that local libraries are using for their digital collections.
If you wondering whether the touch screen on this model is any better than the PRS-700's, the answer according to Sony reps I spoke with, is yes. Apparently, the PRS-700's built-in sidelight added an extra "light" layer or gap that made the screen less responsive, hurt the contrast ratio (made the screen dimmer), and created some glare issues. Sony has eliminated that layer and the overall touch experience has allegedly improved and the letters on the screen are darker. Also, as a result of eliminating the sidelighting, the PRS-600 is slightly slimmer than the PRS-700 and two ounces lighter.
Sony says there will be no wireless option for these models; they are "tethered devices." But in speaking with reps, they did say that Sony was committed to bringing out a wireless device and while they didn't mention an exact time frame, it appeared to be soon, perhaps within weeks. So, if you're waiting for a wireless Reader, whatever form it takes (built-in Wi-Fi or cellular), you should probably hold out a bit longer.
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For its first e-book reader, Samsung Electronics has crumpled up and cast aside its catchy codename and gone downright bureaucratic.
Formerly known by the working label of Papyrus, the new SNE-50K reader will initially be sold only in South Korea, starting Wednesday. But the device may reach other markets across the world sometime next year, said a Samsung spokesperson.
Unlike larger readers such as Amazon's Kindle, the SNE-50K was designed by Samsung to be compact, sporting a 5-inch screen and weighing 6.5 ounces. The device will come with 512MB of memory and offer a resolution of 600x800 pixels.
Borrowing some features from a PDA, the SNE-50K will support handwriting recognition, so users can write and store memos, manage schedules, and view calendar appointments. The device will also let people read text files, PDFs, and Microsoft Office documents by converting those files into a viewable BMP graphic format.
The reader will sell for 339,000 Korean won, or about $270.
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