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Sony Shares VAIO Product Plans

Company to launch new peripherals, high-end consumer gadgets.

Martyn Williams, IDG News Service

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Sony plans to expand its VAIO family of products to include a much wider range of peripherals in order to better compete in the personal computer marketplace, its chief executive officer said Thursday.

Nobuyuki Idei said the company also plans to launch a new range of high-end, cutting-edge consumer electronics products under a new brand name from the middle of this year.

The plans were outlined as the Tokyo company released its financial results for the year to the end of March 2003. The results of cost-cutting and restructuring during the period helped Sony increase net profit by 654 percent to $963.9 million as of March 31, the end of the period being reported, despite a fall in revenues. However, a drop in fourth quarter performance led Idei to promise more cuts in the coming year.

Sales Slump

Idei's plan to expand the VAIO brand and range is part of Sony's attempt to put the brakes on declining sales of personal computers. Sales of VAIO products fell over the entire year but the company saw what it termed a significant decrease in sales in the fourth quarter, from January to March.

"VAIO was not competitive enough during the fourth quarter but I think it is temporary," said Idei speaking at a news conference at the Tokyo Stock Exchange. "It's a very tough PC market and prices are declining. VAIO did not go along with the cost reductions and that affected VAIO."

Such price declines are making it more difficult to make a profit from the sale of personal computers themselves and Idei said that big profits from VAIO may not be feasible in the future. To counter this he proposed extending the VAIO family to include not just desktop and notebook personal computers but a much wider range of peripherals.

Device Details

He didn't offer any specific examples of what these might be, although the company has been having success in related businesses. Peripheral-like devices, such as the Cybershot range of digital still cameras and Clie range of PDAs, were among Sony's best selling products during the year.

In addition to expanding the VAIO brand, Idei also disclosed plans to launch a new range of high-end products under the brand name "Qualia." The first products to carry the new brand name will be unveiled in June. The range is expected to include products such as high-end audio and video equipment and also some of the company's most advanced technology or coolest gadgets. Idei promised consumers "will have delight in just holding these products."

In addition to VAIO, Sony said lower sales of Aiwa-brand products, cathode ray tube TVs and monitors, video cameras, audio products, and cellular telephones hit results. The largest increases in sales were in Cybershot cameras, Clie PDAs, projection TVs, and semiconductors including CCD (charge coupled device) image sensors for digital cameras and LCDs.

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