Electronics is Sony's most important business segment, bringing in 66.8% of its revenue. Sony is a well-recognized and respected brand with consumers, and its products cover a wide spectrum of the entertainment and industrial markets. However, the electronics division has averaged a break-even operating profit over the last five years.
Audio - Sony's Walkman brand had commanded the portable audio market in the 1980's and 90's, but the company had failed to develop a successor to its cassette and CD players. MP3 players and iPods now dominate portable audio, and Sony was unable to gain significant market share with its MiniDisc technology. Sony's audio segment has been declining since 2004.
Video - Sony makes digital cameras and DVD players in its video business. While the company's CyberShot line of digital cameras have enjoyed strong performance, DVD player sales have declined as the market has matured. Sony has been pushing its next generation Blu-ray technology, which it hopes will replace the DVD. However, Blu-ray is in close competition with Toshiba's HD-DVD technology. See Blu-Ray vs. HD-DVD.
Televisions - Television manufacturing constitutes 23% of Sony's electronics division, and is the largest segment. Although Sony has long produced traditional tube and projection television sets, it has since focused on the rapidly expanding market of high-definition and flat-panel sets with its Bravia line of LCD TVs. Bravia is currently the top-selling LCD TV brand in the U.S., with 30% market share. Sony has an advantage over competitors in this business because it uses LCD panels produced by its own S-LCD Corporation joint venture, while other manufacturers must pay for markups on the panels. In April of 2007, Sony announced plans to sell televisions incorporating new organic electroluminescent (OEL) technology. OEL screens are thinner and consume less power than traditional LCD screens because they do not require a backlight. Sony will be the first company to offer OEL televisions and plans to begin selling an 11-inch OEL model by the end of 2007.
Information & communication - Sony's information and communications business includes a broad range of products, including computers, printers, and professional broadcast equipment. Sales of the company's VAIO brand of laptops and PCs have outpaced market growth. Sony has leveraged its presence in the home-entertainment market to produce the VAIO TP Series Living Room PC, which will allow consumers to access online video content from their home-entertainment systems.
Semiconductors - Semiconductor manufacturing is the smallest segment in the company's electronics division, and includes CCD image sensors for digital cameras and small LCDs (Sony's joint venture with Samsung, S-LCD, produces television-sized LCD panels). In an alliance with Toshiba and IBM, Sony has developed the new CELL processor which allows more efficient performance in multimedia and vector calculation applications. The development and price of the CELL processor has also impacted the rollout of PlayStation 3, which utilizes the technology.
Components - Sony manufactures batteries, data recording media, data recording systems, optical pickups, and other electronics components for outside customers. Over the last year, Sony recalled a significant portion of its lithium-ion laptop batteries after reported instances of batteries catching fire due to an internal short-circuit. It is estimated that the recall, which involved more than a dozen laptop manufacturers including Dell and Lenovo , cost ¥51 billion, in addition to significant negative publicity.
Other - Other Sony products include CD and DVD discs, integrated circuit cards, and other smaller products and services.