TOKYO-As expected, Sony Corp. and L.M. Ericsson said they will invest an additional $326 million in their joint mobile-phone business, a move the companies said shows their “continuing commitment” to the venture.
Critics and analysts have wondered about Sony Ericsson Mobile Communications’ future.
According to Gartner Dataquest, the company suffered a precipitous drop in its phone sales over the past year, with shipments decreasing 30 percent. The news was the latest in a string of dreary reports from the company, which recently delayed shipments of its high-end P800 smart phone.
Further, Strategy Analytics in a recent report said Asian handset maker LG Electronics is gaining ground so fast it could potentially knock Sony Ericsson from the top 5 list.
However, Ericsson executives in December reaffirmed their support for the business during the company’s annual analyst strategy meeting in New York, pledging to invest more money into Sony Ericsson.
Sony and Ericsson split the $326 million investment equally, news that coincided with Sony Corp.’s strong third-quarter earnings report.
Sony Ericsson said it sold 395 million phones during last year, compared with 390 million in 2001. The company said it expects to sell 435 million phones this year, a growth of 10 percent. Nokia Corp., Motorola Inc. and other handset makers have recently expressed similar positive views on this year’s phone sales.
Sony Ericsson’s net loss for the fourth quarter was $75 million, an improvement of about $1 million compared to the same quarter a year ago.
