Before the touchscreen smartphone revolution, Sony Ericsson was one of the mobile market's front runners. However, ever since the release of Apple's iPhone and a wave of other Android powered devices from Samsung and HTC, Sony Ericsson has fallen rapidly. Now rumours suggest that Sony will buy out Ericsson's stake in their joint venture in order to make up lost ground.
Sony and Ericsson joined forces in 2001 and agreed upon a 10 year deal in the process, which they must now decide whether to renew or not. Sources told Reuters and the Wall Street Journal that Sony would look to integrate its smartphone operation with other areas of the business, including hand-held gaming devices and personal computers.
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Yoshiharu Izumi, an analyst at J.P. Morgan said Ericsson could receive upwards of $1.3 billion, but this figure would depend on the agreement and the use of various telecoms patents. Izumi believes that by integrating its range of services, Sony would have a better chance of gaining market share.
"Up to now Sony's products and network services have all been separate. Unifying them would be positive," said Izumi. "If they can leverage their games and other network services I think they can lift their share."
Post 2000, Sony Ericsson enjoyed continued success thanks to its range of Cybershot camera phones and Walkman music devices. However, the company failed to react to fast moving trends and as a result, saw their share diminish.
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