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Smartphone market is on the boom and mobile phone manufacturers are aware of the fact. Sony Ericsson has now announced its plans to focus entirely on smartphones to offer stiff competition to its rivals, reports Reuters.
Sony Ericsson, the ninth largest handset manufacturing company in the world, is all set to shift its production to smartphones from next year after making higher profits than expected in the third quarter. This news has come up amid the reports that Sony is wiling to buy Ericsson’s 50% stake in the company.
Many analysts are of the opinion that Sony Ericsson can offer a stiff competition to its rivals only after it merges itself with Sony’s wide portfolio.
“Speculation persists that Sony will buy out the JV,” said Geoff Blaber who works at CCS Insight. “This is arguably the most desirable end game for a company that needs full access to Sony content and services,” added Blaber.
Shifting entirely to smartphones would not be that easy for Sony Ericsson. It will be difficult to deal with players like Samsung and HTC that are working hard to capture a bigger share of the smartphone market.
“On the sales side it’s actually a pretty strong quarter for Sony Ericsson,” said Morten Imsgaard, an analyst at Sydbank. He believes customers are liking company’s new products based around its Xperia smartphones. “On the earnings side it’s not that strong, and the company will have to work on that side going forward to lift the operating margin,” added Imsgaard.
Sony Ericsson’s graph was going down in the recent past. However, it pulled itself back into the game by focusing on smartphones based on Google’s Android platform. Today, about 80 percent of all Sony Ericsson’s sales come from smartphones.
Company’s global market share for Android-based smartphones was approximately 12 percent in volume and 11 percent in value during the third quarter.