Report: 'Sweeping' Sony restructuring due post-CES

Times of London reports that the PlayStation maker will unveil "sacred-cow-slaying" changes after this week's Las Vegas electronics convention.

The 2009 Consumer Electronics Show is just around the corner, with proceedings kicking off with Wednesday evening's keynote by Microsoft CEO Steve Ballmer. The following morning, Sony CEO Sir Howard Stringer will take the stage to announce his plans for the coming year--plans that, according to the Times of London, may be drastic indeed.

Citing "company sources," the Times says that "sweeping" and "sacred-cow-slaying" changes may be in the offing at Sony. Specifically, the venerable British newspaper says that Stringer will likely expand on the 16,000 job cuts that the company announced in December, and may announce changes that heavily impact its Japanese operations as well.

Indeed, sources close to the Welsh-born CEO, the first Westerner to head Tokyo-based Sony, say that he has been clashing with the company's "entrenched management" in Japan since he took over the company in 2005. One of the first casualties of that internecine battle was Ken Kutaragi, the so-called "Father of the PlayStation."

In late 2006, the company announced that the often-outspoken head of Sony Computer Entertainment would be replaced by Kaz Hirai, CEO of Sony Computer Entertainment America. Though the move was portrayed as voluntary, later reports pointed to Stringer's clashes with an "uncommunicative" Kutaragi as a factor, as were the multibillion-dollar losses incurred in launching the PlayStation 3. Kutaragi would leave the company entirely seven months later.

The Times report does not mention SCE or the PlayStation brand, despite recent reports that Sony may break even on PS3 production costs this year. GameSpot will have more on Sony and Stringer's keynote from CES 2009 later this week.

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451 comments
SalarianChemist
SalarianChemist

Sony just reported a financial loss of over $1 billion for the quarter. It has been over 14 years since Sony had a financial loss that large. The games division of Sony had the largest loss of all. This reason (and Sony's lack of liquid assets -- e.g., cash) are the reason why so many reliable industry insiders say there will not be a PS4.

xophaser
xophaser

Stinger, how about adding more memory for the PS3 via usb like what Vista does. And drop the price on a Bravia LCD while you are at it, they are great but too expensive. Better games will sale the system, not the hardware.

fatbody75
fatbody75

God of War 3 is still a potential system seller, as long as it stays exclusive.

trw534
trw534

sony 's a good company ant the ps3 's ok

brendanhunt1
brendanhunt1

I can still see sony making billions out of the ps3 and bluray now the price is going down

jogunther
jogunther

I agree that many less fortunate gamers couldn't afford the PS3 right away. I'll always buy a PS3 unless something really blows it away.

Myzz617
Myzz617

i prefer hard-copies. The downloading thing prevents people from boot legging their products which is why they are trying to push that.

Jemdude
Jemdude

I disagree with the idea that downloading games will save money. When CD/DVD games first came out, people said that we would be paying less than cartridge games. The savings never happened; at least not for the consumer.

WarPrime
WarPrime

Thats what happens when you done move with the times! Sony PS3 sticks to the old mentality of Hardware, Xbox is more flexible, developer friendly, and easily used by the casual user. The PS3's saving grace was the Blueray player...if it wasn't for that no one would have bought it except the MGS fans.

Strigidae
Strigidae

*psychotic laughter* Hope they'll get out of that one. Can't say I didn't see it comin' (LMAO).

e011234
e011234

I would rather pay slightly extra for a physical copy of anything rather than downloaded anyday..In some countries like Australia we have download quotas. I wouldnt dl anything. Same goes for ALOT of other people.

TeTBCN
TeTBCN

I only have a MSX-2 of Sony, and all cartriges of Konami. After i buy a PC (Q3A an BF1942), And go to world of consoles with XBox and XBox Live for a perfect online comunication. With Xbox 360 i view more services. Services that Sony lost or have´t by the blu-ray disc and the hard head of directives of Sony. The future is the SDHC or download content by sat, internet or other metodes. But the phisic support (BD) have the days losed. a greeting and sorry by my english

Zloth2
Zloth2

So.... Thursday morning has come and gone, why is this article still up? Where's the article outlining what he actually said?

gamer082009
gamer082009

Sounds like Sony's having allot of issues internally. So much for trying to assume that the Playstation name would secure a purchase at any outrageous price.

jknight5422
jknight5422

Sounds like from this story that the reason the PS3 failed is due to all the internal battling within the company between the CEO & the Japanese execs. Maybe Kutaragi was trying to torpedo the PS3 while he was there? With the economy in the drink, the PS3 is sure to sink.

BikerPunk
BikerPunk

GRLEW - sorry man, not everyone trades in. I keep all games i play. i am a purchase gamer. I buy the game and play the snot out of it. I am even known for revisitin old games frequently. So not only do i get my money out of them, i get more cause i always go back for another play. The only time i rent a game, is if i was really looking forward to it, and it got horrible reviews. then i will normally rent it insteadof buying it. most times, i just keep it from blockbuster then end up buying it anyways. Also, as far as the 360 ability to play MGS4, you should really take a look at some of the system comparisions that GS does, and you would realize that the system can handle anything PS3 can handle. Hell, it works vise versa too. The only system that cant handle those games are the Wii, and well, the Wii wasnt designed to play that sort of game. you need to do some checking before spewing verbal diarria.

slqmaster
slqmaster

there some reallly dum comments below. economy isn't doing well, world recession. yet both M$ and Sony are pushing forward with ground breaking technologies, and a growing percentage from last year gaming. both of these companies are being smart and reforming departments and triming lose. very smart choice for the future for gaming

joevitale1
joevitale1

grlew, the 360 can run MGS4. Even the games maker had something to say about. I think you are behind on some info so let me get you up to speed. Sony is talking about not having a drive in it's PS4 (2013) MS has told the same thing. Downloading is the way to go. It will save cash for every one and we will pay less for games. I do hope things turn around for Sony, and all comps. I dont like to hear about people not having jobs. It's not good. Sucks how comps do something stupid and the hard working people pay for.

joevitale1
joevitale1

[This message was deleted at the request of the original poster]

necronaux
necronaux

Even with them breaking even on the PS3 console, the layoffs were inevitable.

grlew
grlew

FlyingDutchDog I agree with you that in some aspects but I think MGS4 proves you wrong, a game which the 360 not only doesn't have but simply isn't capable of playing

grlew
grlew

Blu Ray won't fail and heres why people are smater than that why would you go and pay a big wack of cash to download something when you can rent it and get your use out of it for less. Similarly if you download you don't have the physical product so you can sell/trade it. Personally I get my use out of DVD/Blu Rays and games then trade them straight back to the store when I'm done and so does everyone else with some common sense

joevitale1
joevitale1

@Chankx. piracy will never go away. Blu-Ray was the so called stop to movie piracy and that did not work out so well. The big Blu guys told movie studios that it would take 10 years before some one could rip a Blu-Ray movie and not even a year later people did.

joevitale1
joevitale1

More crazy news. This is not 100%. MS want to fit the next xbox with a 3tb hard drive. I'm just getting this stuff off the net most of the time it's about 90% right. @LiLaZnPimP2691. Ah, that was a stupid post. The DL'ing is next gen, not this gen. You will need big hard drives for next gen cuz every one is going to have you buy game by way of "DL'ing" This gen is kind of like a test ground for it and it has done well. So the next step is just to buy the game like you would with steam. But the bad thing is. All cable comps will slow down your speed and charge more for net. I got a letter not long ago tell me to stop downloading big files. It is taking away speed from other. So when I download a demo or somethig off of steam they get mad.

MTMind2
MTMind2

@felipenet7 who says "PS3 = U$399 360 = U$199 well!! M$ needs to sell 3 consoles to make the kind of money PS3 makes with 2 consoles!" please tell me you are joking. you couldnt be more wrong if you tried! :-|

Chankx
Chankx

@rbop Didn't Blu-Ray already put HD-DVD out of business? The only reason why CDs are failing is because piracy.

LiLaZnPimP2691
LiLaZnPimP2691

well if DL'ing games is the future then im glad my ps3 has a big HDD that came with it and ps3 games i can DL from the PS Store. that said, even if bluray does fail at least theres a HDD that came with my ps3 to DL games unlike the HDD-less 360 arcade

Elfrancorifle
Elfrancorifle

felipenet7 ppl who buy $200 xbox 360 are the dumbest in the world that thing practically doesnt have any hardrive

flyingdutchdog
flyingdutchdog

@lowkey254 I always get a kick when PS3'ers think they have the better hardware. The car with the biggest engine isn't always the fastest car ... a whole lot of other factors contribute to the final performance of the car. After two years, it is obvious that the PS3 is not the better hardware and I am referring to the few exclusive games released for the PS3 as case in point. So yes, it's all about opinion and my opinion is the PS3 is obviously not where it's at. I do have all 3 systems and it just seems right now that the 360 is where it's at.

joevitale1
joevitale1

@stovich. I have some new for you bud. I have read all over the net that Blu-Ray was owned by DVD in the last part of 08. Most of the smart guys in the teck world say Blu-Ray wont make it and only a few % can even tell what is Blu-Ray and what is DVD. Blu-Ray was something made for people with 50''+ tv. Here is a link that can back that up. http://kingofgng.com/eng/2008/11/16/will-blu-ray-die-at-christmas-2008/ I also found out that the PS4 will not have any kind of drive in it. They will follow MS and Mac with downloading as the best way to sell games. Like steam. You fail @ your post, and your gaming life. I dont care about what system is better. I like the kind of games systems have. You need to read up on teck before you try to drop bad info on some... You just got owned.

felipenet7
felipenet7

well well Game$pot (M$) did you forget to mention this or was it on purpose?!!! PS3+PS2+PSP the clear winner!!! PS3 = U$399 360 = U$199 well!! M$ needs to sell 3 consoles to make the kind of money PS3 makes with 2 consoles!

felipenet7
felipenet7

Microsoft to pursue EUK for lost stock Software giant said to be considering legal action to reclaim stock stranded in distributor warehouses

felipenet7
felipenet7

Thousands of jobs under threat at Microsoft Company expected to announce cuts in next few weeks, EMEA to be affected heavily says report

felipenet7
felipenet7

everything up from the same source where Gamespot (M$) got this news from... PS3 sales up 130 per cent during Xmas Sony happy with "solid holiday season"

stovich
stovich

rbop - you fail @ life. You're possibly the biggest dumba55 I've ever seen on here. HD DL won't be here for quite some time, and everyone and their 3rd cousin knows it. And for you're uninformed and limited capacity, PS3 is in fact NOT failing. Maybe you should check your 360.

bradwega
bradwega

I sent 6 360 in for repair and never got a new one

rbop
rbop

Sony heard that gamers and porn decide the victor in format wars (VHS/DVD) and decided to bank on that w/ the PS3. They tried to push BR on everyone, whether you wanted it or not. It was a gamble, and not neccessarily a bad one, but it didn't pay out and that's why the PS3 is FAILING. That is NOT too harsh a word BTW. Ask any Sony executive 3 years ago what his sales prognostication for the PS3 would be on this date and I guarantee that the numbers we have seen thus far would fall very very short (see: nexgenwars.com). Blu-ray was a risk that Sony felt was worth taking, but it bit them in the hind parts. The contemporary consumer is much more savy than his counterpart just five years ago. Nobody is going to commit to BR when they know that downloadable HD video will be accessible in a very short time to the majority of the population. You didn't see people running out in droves to buy CDs anymore once downloading music came about did you? The writing was always on the wall... too bad Sony was busy looking at the floor.

HeadshotAce
HeadshotAce

We all know that "restructuring" is going to result in job cuts so I have to say I feel sorry for those people who are going to lose their jobs. However, I never like this rationalization by some that Sony's problems are largely down to the global economic slowdown. In spite of difficult economic conditions, both Nintendo and Microsoft have had record sales this past year so we all know that the economy is not to blame (in whole or part) for Sony's lacklustre sales.The games industry is an exemption from the general economy, always has been. Particularly in these times of economic gloom, people want, more than ever, escapism and fantasy distraction away from the harsh economic reality. Nothing provides this better than video games, hence our still insatiable appetite for games. I own/owned consoles from all manufacturers (PSP, PS2, PS1, GC, N64, SNES, 360, Wii, DS, Dreamcast, Megadrive) so I am no fanboy. I buy what suits me and my budget best, as it should be. Sony's problem with the PS3 is not with the quality of the console. There is no doubt it is the most technically advanced console available at the moment. Sony's problem right from the outset is the cost of the PS3. Hardly a revelation I know but more specifically we are talking about accessibility of the PS3. Many gamers still can't afford the PS3's price tag, let alone the price at launch. The PS3's manufacture costs obviously translate into high retail prices but that is not the whole story. A lot has been said this last week about Sony nearly breaking even on manufacturing costs ($449/PS3) but I wonder if this figure takes into account the phenomenal amounts of money ploughed into development of the PS3, billions of dollars no doubt. The reason it cost so much to develop is likely because Sony wasn't developing one product but two, firstly a bluray media player and secondly a games console. With such high development costs, it is no wonder that Sony have a product that struggles to be price-competitive in a cut-throat market like the console market. To use a crude metaphor, the current console generation is like a horse race. The Wii is a good horse with no saddle or jockey to weigh it down, the 360 is a steady horse with a competent experienced jockey and the PS3 is a thoroughbred horse but sadly with a 400lb jockey called Bluray. What horse would you bet on?

alixkid
alixkid

@ Makaatsu, Amen Brother your facts are compleatly correct. How does it feel Sony to get the sqeeze like Sega Did???

Dav_id83
Dav_id83

Ken Kutaragi the so called father I'm sorry he was the father of Playstation if it wasn't for him Sony wouldn't even have a gaming division at all and Stringer I think sometimes dosn't even know what time of day it is because he speaks BS. Its sad that others have to suffer and lose there job what happens in 2-3 yrs when they start taken on again will they have a chance to get there job back I doubt it.

joevitale1
joevitale1

@Heffe2020. LMAF. But... The RROD is still a big prob. I have send one 360 in 2 times and after that they sent me a new one. Well that went dead and the newer chip set 360 cam out and same thing. Well MS would not fix it. My son got a mark on the back of the box. So, we got a new one last may. The 24th of last month. RROF. Good timing. My son got 10 new games for it and cant even play them right now. it just got to TX and might be here friday. But, we do like the 360 and we will keep getting it fix if we need to.

jtthegame316
jtthegame316

Competition is what makes the business jmartinez1983 that is why things were better when it was sega vs nintendo with out sony. no dirty tricks of making out a game was only on there console when it was on the other to which is what sony do all the time. just gamers getting quality game after quality game on each system. Best of all sega and nintendo had good first party stuff unlike sony. It was nintendos fault sony came in in the first place so if there was justice sega would be making consoles still and nintendo would be software only. As sony did come in though thank goodness microsoft came in to stop them compeltly dominating. If the playstation brand was to dissappear then my be these horriable playstation fan boys would that expect third parties to make games on only there platform. it's like they are a third party it is only right they support everything and not side with no one.

Heffe2020
Heffe2020

Congrats Microsoft! ohhh sorry wrong page.

ps3loverr
ps3loverr

too bad sony isnt being smart the best thing to do right now is to drop the ps3 but they dont want to give up they should just set up something on there sight that lets the people tell them wat we want maybe thatll help them sell they just need games

Heffe2020
Heffe2020

Why are people still bringing up the RRoD they pretty much fixed that problem. Even if you happened to get one you can easily fix it yourself, or send it in and get a brand new xbox which is pretty f.ckin sweet.

Heffe2020
Heffe2020

I love how everyone is an expert, if you dont work for one of these companies then you're pretty much just talking out of your .ss.