SONY C O R PO R AT I O N Berrak Dogruer Mazen Ferzly Hiep Nguyen Douglas Roach Rafik Ward AGENDA вЂў Company History вЂў Founder : Akio Morita вЂў Corporate Policy вЂў Strategy & Organization вЂў Current Initiatives Company History вЂў 1946 - Tokyo Telecom Engineering вЂў 1950 - First Japanese tape recorder вЂў 1955 - First transistor radios вЂў 1957 - First pocket-sized radio вЂў 1958 - Name change to Sony (from "sonus," Latin for "sound," and "sonny," meaning вЂњlittle manвЂќ) вЂў 1968 - Intro of Trinitron color TV вЂ“ explosive growth вЂў 1979 - Walkman personal stereo Company History вЂў 1980вЂ™s - Major Producer of computer disks/ floppies вЂў 1988 - Bought CBS Records for $2 billion. вЂў 1989 - Bought Columbia Pictures for $4.5 billion. вЂў 1994 - Sony Playstation released to great success. вЂў 1997 - JV with Philips (inventors of the CD) to make Super Audio CD вЂў 1998 - Launched Wega flat-screen TV вЂў 1999 - JV with Philips, Sun Microsystems to develop networked entertainment products вЂў 1999 - Walkman with MP3 capabilities Company History вЂў 2000 - Formed PlayStation.com вЂ“ games/software online вЂў 2000 - Restructured all entertainment units under Sony Broadband Entertainment вЂў 2001 - JV Sakura Bank and JP Morgan Chase for online bank. Founder: Akio Morita вЂў Groomed to take over 14-generation family Sake business вЂў Strong entrepreneurial spirit: Tokyo Telecom Engineering вЂў Revolutionary thinking: Brand is lifeblood of company success вЂў Listed Sony on NYSE in 1970. вЂў 1966 вЂњNever Mind SchoolвЂќ emphasize the capabilities of individuals, rather than their prior academic background and history вЂ“ a revolutionary concept for Japan. вЂў Strong belief R&D leads to new ways to meet customer needs. вЂў Co-chair of various conferences, including the Japan-U.S Business Council, The Trilateral Commission, and the World Economic Forum in Davos. Founder: Akio Morita вЂў Instrumental in easing trade friction with the U.S by playing leading roles in the Keidanren (Japan Federation of Economic Organizations), the Japan-U.S. Economic Relations Group. вЂў 1998 - Morita chosen as one of Time magazineвЂ™s 20 most influential business people of the 20th century - the only Asian member on its list. Akio Morita: The Sony man who put Japan on the corporate map passed away in October 1999. Procurement Policies Reflect Corporate Policy вЂў Open Doors and Fairness вЂў Quality and Competitive / Reasonable Price вЂў Delivery Assurance and Services вЂў Optimum Procurement вЂў Technology Development вЂў Suppliers' Management Strategy and Organization вЂў Continue to focus on communications and home electric appliances, but also content and services вЂў Vertically integrated business вЂў Vision is to become a broadband entertainment company вЂў CEO Idei Nobuyuki wants Sony to be wherever people gather (Internet) вЂў Product-Market Strategy: Apply IT to product design, production, distribution, and sales Sony Business Units вЂў Electronics: вЂўAudio,Video, Televisions Information and Communications. вЂў Sony Computer Entertainment: вЂўHardware and related software вЂў Sony Music Entertainment: вЂўSony Music Entertainment Inc.: Columbia Records, Sony Classical, Sony Discos,Sony Disc Manufacturing, and Sony Music Nashville вЂўSony Music Entertainment Japan: Sony Records and Epic Records Sony Business Units вЂў Sony Pictures Entertainment вЂ“ вЂў motion picture - production, acquisition and distribution вЂў television вЂ“ programming, production, acquisition and distribution вЂў home video - acquisition and distribution вЂў television broadcasting вЂў operation of studio facilities вЂў Sony Life Insurance вЂў Other: Blue Streak Wheel of Fortune Big Daddy вЂў Sony Finance International, Inc. вЂў Sony Trading International Corporation вЂў Sony Broadcast Media Co. Ltd. вЂў Other local entertainment businesses in Japan, U.S., and Germany. Sony Business Units Region $ (Millions) % of Total Japan 20,012 32 US 19,124 30 Europe 13.872 22 Other Regions 10,074 16 Total 63,082 100 Interesting Current Initiatives вЂў вЂў вЂў E-Commerce вЂў SonyStyle.com in Feb 2000 вЂў Strategy reflects its desire to reduce the role of the big discounters as middlemen and gain greater control over prices Car Navigation Systems вЂў 7% of worldwide market вЂў These systems incorporate sophisticated technology, including webaccess and advanced voice recognition. Video-Game Machines and Console Software вЂў SonyвЂ™s Playstation 2 (PS2) is claimed to be the first next-generation game console. This system can play DVDs, CVDs, and CD-Roms. вЂў In February, Sony Corp. unveiled an alliance with game software makers Sega Corp. and Namco Ltd. in online game distribution. Interesting Current Initiatives вЂў AIBO- Artificial Intelligence ROBOT вЂў As close to human as possible вЂ“ has emotions and instincts Questions to Ask вЂў PlayStation2 was an instant success with demand clearly surpassing supply. Some say it is because of inaccurate demand forecasts while others suggest that it was an intentional strategy. What is you take on this? вЂў How is your electronic division and music division responding to concerns over MP3 format piracy issues and your secure yet not very popular format? вЂў How has the vision of your founder, who recently passed away, been passed on to the new management team at Sony? вЂў How has the dissatisfaction of some CD retailers over your strategy to sell directly to consumer affected your distribution strategy via SonyStyle.com?