Sony goes down market with affordable camcorder to save its bacon

Bad earnings and the recession are making Sony (SNE) look at whether its traditional way of doing business can allow it to prosper in the current economic environment.

Sony has a plentiful supply of problems. Its PS3 game console still lags sales of the Microsoft (MSFT) Xbox 360 and Nintendo Wii in most months in most markets. It has too much competition in its business of building video screens. Its movie studio, like all others, is successful based on one or two blockbusters a quarter. No blockbusters equals no earnings.

Sony has decided that it is time for the company to be recession-friendly. According to The Wall Street Journal, "Sony Corp.'s new digital camcorder sells for under $200 and doesn't offer any major breakthroughs. But it symbolizes an important shift in Sony's culture, which has been focused on making expensive technological marvels, rather than affordable, easy-to-use products."

Sony's move makes sense, but it may come a little late for the company to pick up substantial market share. A look at Amazon.com's consumer electronics section shows that Samsung, Sanyo, JVC, Canon and several other companies make inexpensive video camcorders.

Selling inexpensive products may get Sony's electronics business exposure to a larger market, but it also puts it in a league with plenty of competition.

Douglas A. McIntyre is an editor at 24/7 Wall St.

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