When was sony created

Matsushita launched a vigorous marketing campaign to convince customers and other manufacturers not only that VHS was superior, but that Betamax would soon be obsolete.

The marketing war between Matsushita and Sony was neither constructive nor profitable; both companies were forced to lower prices so much that profits were greatly depressed. Although Betamax was generally considered a technically superior product, the VHS format grew in popularity and gradually displaced Betamax as a standard format.

Despite its falling market share from 13 percent in to 5 percent in , Sony refused to introduce a VHS line until the late s. In Morita personally oversaw the development of a compact cassette tape player called the Walkman. Inspired by Norio Ohga's desire to listen to music while walking, Morita ordered the development of a small, high-fidelity tape player, to be paired with small, lightweight headphones that were already under development.

The entire program took only five months from start to finish, and the product's success is now legendary--Walkman even became the generic term for similar devices produced by Sony's competitors. During the s, Masaru Ibuka, 12 years Morita's senior, gradually relinquished many of his duties to younger managers such as Norio Ohga, who was named president of Sony in Ohga became president shortly after a corporate reorganization that split Sony into five operating groups marketing and sales, manufacturing, service, engineering, and diversified operations.

While not formally trained in business, Ohga nonetheless understood that Sony was too dependent on an unstable consumer electronics market. In one of his first acts, he inaugurated the program to increase sales in institutional markets from 15 to 50 percent by During this time, Sony's research and development budget consumed approximately 9 percent of sales Matsushita budgeted only 4 percent.

Another groundbreaking result of Sony's commitment to research and development was a machine that used a laser to reproduce music recorded digitally on a small plastic disk. The compact disk or CD player, introduced by Sony in , eliminated much of the noise common to conventional, analog phonograph records. Sony developed the CD in association with the Dutch electronics firm Philips, partly in an effort to ensure broad format standardization.

Philips, which had developed the most advanced laser technology, was an ideal partner for Sony, which led in the pulse-code technology that made digital sound reproduction possible.

Soon the CD format was adopted by competing manufacturers; by the mids it had virtually replaced phonograph systems as the recording medium of choice. Early in the s, Morita began ceding some of his duties to Sony's president, Norio Ohga, the young opera student hired 30 years earlier to improve Sony's tape recorders. Under Ohga, Sony entered into a new acquisitions phase with the intent of protecting itself from the costly mistake it had made with Betamax.

One example of the changes Ohga brought about was Sony's video camera, introduced in Lighter, less expensive, and more portable than VHS cameras, the camera used 8mm videotape, and was incompatible with both Betamax and VHS machines. The key difference between this and earlier Sony products was that Sony developed the new 8mm video format in conjunction with over competitors. While the camera may have been incompatible with the older Betamax and VHS technologies, Sony ensured that it would be compatible with the next generation of video cameras.

Within three years of its introduction, the camera captured over 50 percent of the European, 30 percent of the Japanese, and 20 percent of the North American markets. In May Sony purchased Apple Computer's hard-disk-technology operations.

As a result of this acquisition, Sony was able to control about 20 percent of the Japanese market for workstations, personal computers used in business offices, thus helping to increase the proportion of its sales derived from institutional customers. Ohga also broke a decades-old tradition in when he established a division to manufacture and market electronics components for other companies. By , fueled by strong sales of semiconductors once manufactured only for Sony products , the components division had grown to represent about 11 percent of Sony's total sales.

CBS Records, whose labels included Epic and Columbia, was during this time the largest producer of records and tapes in the world. Sony had learned through its Betamax experience that a superior product alone would not ensure market dominance; had Sony been able to flood the market with exclusively Beta-formatted movies, the VCR battle might have turned out differently. Looking toward the future development of audio equipment, including digital audio tape DAT , Sony bought the record manufacturer with an eye toward guaranteeing that the products it manufactured to play music would remain compatible with the medium used to record music.

The acquisition marked less of a diversification for Sony than an evolution toward dominance in a specific market. Sony sought further diversification in U. Then in Sony made headlines around the world when it bought Columbia Pictures Entertainment, Inc. Columbia provided Sony with an extensive film library and a strong U. Industry analysts applauded the move; when a recession hit the film industry shortly after Sony's purchase, however, some began to question Sony's ability to deliver its traditionally strong profits.

By this time the entertainment operation had been renamed Sony Pictures Entertainment, Inc. The complexities of operating a truly multinational corporation, however, began taking their toll on Sony. Most of the world's largest economies Europe, Japan, and the United States were experiencing a slowdown in the early s.

This factor created what Sony called 'an unprecedentedly challenging operating environment. During that year, Ohga assumed the duties of chief executive in addition to his role as president.

He and Morita responded to Sony's tough economic situation by bolstering marketing, reducing inventory levels, streamlining operations, and keeping a watchful control of capital investments.

The company also embarked on an extensive reorganization effort with the goal of decentralizing operations and reducing unnecessary management. Despite these measures, Sony was unable to stem the slide. By this time Morita had relinquished virtually all his duties in the company, having suffered a stroke in late In Sony's annual report, his picture and signature were conspicuously absent from the letter to shareholders, implicitly announcing Ohga's new leadership position.

Under Morita's leadership, Sony's rise to preeminence in the world consumer electronics market was almost entirely self-achieved; Sony outperformed not only its Japanese rivals, among them associates of the former zaibatsu conglomerate companies, but also larger American firms, which by had all but abandoned the consumer electronics market.

In April , Ohga ascended to the chairmanship of Sony, and Morita was made an honorary chairman. The company's new president was Nobuyuki Idei, a year veteran of the company, who had founded Sony's French subsidiary in and had since played a role in many of the company's major accomplishments, including audio CD technology, computer workstations, and the 8mm video camcorder.

Sony's success had been a direct result of the wisdom of its founders, who had the talent to anticipate the demands of consumers and to develop products to meet those demands; Idei's presidency, some suggested, signaled a new era for the company. Immediate among Idei's concerns were helping Sony become an integral player in the information highway industry.

He also hoped to help the company establish an industry standard for DVDs, or digital videodisks, CD-like disks capable of holding full-length films for play on television screens via players. Once again, Sony had teamed up with Philips to develop a DVD format, but the partners quickly discovered they were facing a rival format developed by Toshiba and Time Warner.

This rival format quickly gained the support of a number of the world's consumer electronics powerhouses. Sony subsequently introduced its first DVD player in March Meanwhile, Sony unexpectedly entered the video game market in the mids, making an immediate splash. The development of the Sony PlayStation had actually begun in the late s as a joint project with game giant Nintendo Co.

Controlling its own content ensured that Sony's technological innovations would never be thwarted by lack of industry support, as Blu-ray's triumph over the rival HD-DVD format would illustrate. Rivals Nintendo and Sega resurrected the gaming console market in the late s, after the spectacular crash of early pioneers such as Atari. Seeing the potential for a new contender with deep pockets and superior technological expertise, Sony formed a new division called Sony Computer Entertainment in to exploit this market niche.

Its Playstation line of consoles and their portable counterparts have proven to be reliable moneymakers for the company. Much of that loss came from the company's decision to shut down its troubled PC manufacturing operation, as well as lower-than-expected sales of smartphones and ongoing price pressure from lower-cost rivals in its audio and video divisions.

Its mobile communications division, gaming division, imaging-products division and Sony Pictures division remain strong, providing the bulk of the company's projected revenue growth for Mark Kennan is a writer based in the Kansas City area, specializing in personal finance and business topics. Share It.

References Sony Corp. Securities and Exchange Commission Sony Corporation. Sony Pictures Museum. TV Tropes. The New York Times. The Baltimore Sun. Accessed June 4, Oxford Music Online. The Pictures segment includes planning, production, and distribution of films and television programs. The Music segment includes planning, production, manufacture, and sale of music software; and production and sale of animation works.

The Financial Service segment includes life insurance, damage insurance, banking, and credit finance businesses. Sony found its beginning in the wake of World War II. In , Masaru Ibuka started an electronics shop in a department store building in Tokyo. In the company name was changed to Sony. In the process, he was struck by the mobility of employees between American companies, which was unheard of in Japan at that time.

When he returned to Japan, he encouraged experienced, middle-aged employees of other companies to reevaluate their careers and consider joining Sony. The company filled many positions in this manner, and inspired other Japanese companies to do the same.

Moreover, Sony played a major role in the development of Japan as a powerful exporter during the s, 70s, and 80s. Known for its production quality, Sony was able to charge above-market prices for its consumer electronics and resisted lowering prices.

In , Masaru Ibuka handed the position of president over to his co-founder Akio Morita. Sony began a life insurance company in , one of its many peripheral businesses.