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Sony to buy Ericsson's 50% venture?

Posted: 13 Oct 2011     Print Version  Bookmark and Share

Keywords:joint venture  Apple  Samsung 

According to a report, Sony is nearing a deal to buy out Ericsson from their 10-year joint venture in order to rival Apple and Samsung. The venture costs between Rs.5,829.60 crore ($1.3 billion) and Rs.7,623.32 crore ($1.7 billion).

Sony wants to gain control of Sony Ericsson and integrate it with its tablets and gaming consoles, based on a report. It added that this would allow Sony to save costs and to improve its mobile device development. Moreover, this could be seen as a strategic move to prime the company against Apple and Samsung.

Sony Ericsson posted a net profit of Rs.538.57 crore ($120.1 million) in 2010 after quarters of losses. The company, which has undertaken a transition to smartphones by relying on Google's Android OS, has watched its market share shrink from 4.3 per cent in Q3 '09 to 1.7 per cent in 2Q11, according to research firm Gartner.

There have also been recent indications that Sony Ericsson is moving towards a product alignment with Sony. The handset maker's Xperia Play Android phone is essentially a mobile Sony PlayStation device married to a phone, and has access to Sony's video game library. Additionally, Sony Ericsson's flagship Android phones, including the Xperia Arc, connect to Sony TVs through DLNA technology.

Representatives from Sony, Ericsson and Sony Ericsson refused to comment on the matter.

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