Sony Strikes Back: New Devices Take Aim at Apple's Iconic Products

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It seems like ancient history now, but there was a time over a decade ago when Sony (SNE) dominated the market for mobile media devices. Heck, the company's Walkman portable music player practically defined the market -- so much so that the brand name becoming synonymous with the category, like Kleenex or Pampers.

But no longer. Apple (AAPL) has long since absconded with the mobile media crown, and its iPod and iPhone have achieved iconic status. Now, with the impending arrival of the iPad, Sony has apparently decided that it can no longer take the drubbing, and is moving to regain its lost clout in the mobile media space.

"Answer to iTunes"

To that end, Sony is preparing to launch a new smart-phone, as well as a new media device, both of which will play games from the company's popular PlayStation 3 gaming platform. The devices will work with Sony's new online media hub, which The Wall Street Journaldescribes as "the company's answer to Apple's iTunes." The new devices are slated to come to market this year.

Sony issued a statement downplaying the Journal report. "As already announced, Sony and Sony Ericsson have been strengthening their collaboration in the networked mobile space," the company said. "However, it is not our strategy to discuss future products or business plan before we make a formal announcement. Any media report that suggests details of the product or business is based on speculation."

Sony is feeling the pressure from Apple, particularly in the gaming space. The company's PlayStation Portable, or PSP, was supposed to take video games off televisions and desktop computers and put them in the palm of your hand. And while the device has been popular, selling some 55 million units to date, it is facing major competition as Apple moves aggressively to incorporate games onto the iPod and forthcoming iPad. Sony recently cut its 2010 sales forecast for the PSP by one-third.

Gunning for the iPad

And then there's Sony's Reader device, which has sold over 1 million units, but is still overshadowed by Amazon's Kindle e-reader. The iPad poses a threat to both devices. Last month, Sony made it clear that it intends to compete vigorously against the iPad.

"That is a market we are also very interested in. We are confident we have the skills to create a product," said Sony CFO Nobuyuki Oneda in comments cited by InformationWeek. "Time-wise we are a little behind the iPad but it's a space we would like to be an active player in."

Sony has struggled in the mobile phone business as well. The company's joint venture with Sweden-based Erisscon, Sony Ericcson, saw shipments decline 41% in 2009, according to the Journal. The new phone will be a product of the joint venture, the newspaper said, and will run Google's open-source Android operating system, giving it a link to another company already locked in a bitter battle with Apple.

All of the new Sony devices will run on the company's nascent online platform, known provisionally as the Sony Online Service, which is expected to launch later this month. The service, which is aimed squarely at Apple's iTunes Music store, will offer movies, TV shows and video games. Given Apple's years-long head-start, however, it's hard to see how Sony will make much a dent in the mobile media market. It certainly needs its products to perform better than they have in recent years.
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