Goodbye Sony Ericsson, hello Sony smartphones. By purchasing the other half of its cell phone business from Ericsson, Sony hopes it can become a mobile powerhouse on its own.
Sony will pay 1.05 billion euros for Ericsson’s stake of the business, making it a wholly-owned subsidiary. Once the acquisition goes through, Sony will phase out feature phones in favor of smartphones, so we can expect to see a lot more Android handsets from the company in the future. (Also a possibility: Sony could acquire HP’s WebOS and have its own mobile operating system. Sony CEO Howard Stringer said “Never say never” when asked if his company was considering it, according to Pocket-Lint.)
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As GigaOM’s Bobbie Johnson points out, this deal is largely about control and brand awareness. With Sony in control of the entire smartphone operation, it can work on integrating smartphones with other Sony products, including TVs, game consoles and tablets. Sony’s competitors are already doing this: iPhones sync media with iPads, and can beam content to the Apple TV. Samsung smartphones and tablets can act as remote controls for Samsung televisions. Over time, every screen will be connected, and Sony doesn’t want to be left out.
The name recognition may also help Sony, especially in the United States, where Ericsson is an obscure brand, and where Sony Ericsson phones have been unsuccessful. U.S. wireless carriers have ignored most of Sony Ericsson’s recent smartphones, with the exception of the game-centric Xperia Play, but they may start paying attention simply because of the Sony brand.
Sony also gets ownership of some key patents as part of the deal. While that sounds kind of dull from a consumer standpoint, Sony says it’ll help the company connect all of its devices without running into infringement issues. “We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment,” Stringer said in a statement.