Sony Mobile may leave the entry level tier, says exec
The Sony Xperia Z (below) and its (soon-to-be) iconic power button. — LAS VEGAS, US—Having finished 2012 a distant third behind smartphone giants Apple and Samsung, Sony is very keen on being in the big leagues.
Context & Ripple Effects
Sony's mobile ambitions have been pointing upmarket for years — back in March 2010 the company was already framing its gadgets as taking aim at Apple. What has changed by CES 2013 is the stakes: Sony closed 2012 a distant third in smartphones behind Apple and Samsung, and the Xperia Z flagship is its bid to be taken seriously in the big leagues.
Against that backdrop, a Sony executive floated the idea of leaving the entry-level tier entirely to concentrate on higher-end devices — a claim that remains unconfirmed as company policy but was picked up widely, with syndication across TechCrunch, Phone Arena, IntoMobile, Pocketnow and others on or about January 11, 2013.
First-order effects
- Budget-conscious buyers and the carriers who serve them would lose Xperia options at the low end, leaving Sony's lineup concentrated around premium devices like the Xperia Z.
- Samsung and Apple's grip on the top of the market is the explicit target: Sony is betting that fewer, better phones can buy it relevance where volume alone has not.
Second-order effects
- Exiting the entry tier hands that volume to rivals still competing there — Samsung below, plus the low-cost Android makers — while raising the cost of failure for Sony if a flagship misses.
- Competitors watching the move face pressure to sharpen their own tier strategies, since a credible premium-only challenger changes how carriers slot second-tier Android brands.
Third-order effects
- If the pattern holds across also-ran handset makers, the smartphone market structurally splits into a two-horse premium race and a commoditized low end, with mid-pack brands forced to pick a side or shrink.
- Premium-or-exit logic points toward further portfolio pruning at struggling Japanese electronics firms, where loss-making hardware divisions get weighed against core businesses.
The trend: Smartphone vendors stuck behind Apple and Samsung are retreating upmarket, trading unit volume for margin and brand position as the low end commoditizes.