Sony’s Smartphone Strategy: The Last Man Standing?

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There’s more than one way to skin a cat, or in this case, the smartphone market. Sony, a company not exactly mentioned in the same breath as Apple, Samsung and HTC, has quietly moved into the number three position in the global smartphone market in the third quarter but it got there in a less than glorious way.

Sony Xperia TIt would be nice to say it got there through determined marketing and sales, but the truth is, the Xperia smartphone is number three behind Apple and Samsung because the competition collapsed.

In the third quarter, Sony held a 4.8% share of the world’s smartphone market by shipments, according to the IDC data, down slightly from 5.0% in the same period a year earlier. Meanwhile, Nokia’s market share for the quarter tumbled to 3.4% from 13.6% a year earlier, while HTC’s share dropped to 4.7% from 10.3%. RIM’s share fell to 4.2% from 9.6%.

Between them, Apple and Samsung own almost half of the market, with 31.3% for Samsung and 14.6% for Apple. No one else has more than 5%. So can Sony make the most of it?

Sony did not respond to requests for comment. Analysts say maybe. The first thing it has to do is break out of its native Japan. As the second- or third-largest economy in the world next to the U.S. and China, many Japanese companies have been comfortable selling only to their own nation. Sony needs to break out of that.

Sony still has a low profile, but around the world, Sony is stepping up its efforts to say we have a lot of good smartphones,” said Ramon Llamas, research manager for smartphones at IDC.

According to IDC, Sony’s unit volume in the third quarter was 8.8 million units. In Q1 it was just 5 million and Q2 was 7 million.

“So they are making progress. It’s still early days for Sony in the U.S. Can they do better? AbsolutelyBut they have got to brand a lot stronger. They are still known as an electronics giant but not a phone company. Right now they have one phone [the Xperia] with one mobile operator [AT&T],” said Llamas.

But Jack Gold of J.Gold Associates wonders how that will happen. “How are they going to differentiate their phones, when there are so many out there competing, to get mindshare? Right now they aren’t doing anything,” he said.

Gold noted that Sony, once the standard for TVs, is getting its lunch eaten by Samsung and LG, and that was its core business. “They’ve lost huge market share. When was the last time you went to someone’s house and saw something labeled Sony? That used to be the thing,” he said. So if it can’t compete on TVs, good luck on phones, he argued.

Llamas said the problem at Sony is it tries to sell every feature of the phone, rather than pick one really cool feature and focus on it, the way Apple so masterfully does. “”What it comes down to for me is you can’t sell a device and talk about every feature it has in 30 seconds. It just doesn’t work. Pick your battles on one approach you want to hit with consumers out there,” he said.

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