With the PC market being increasingly commoditized, those firms without economies of scale are seeing their PC divisions are more of a liability than an asset. After being spun off from Sony nearly 3 years ago, VAIO entered talks with Fujitsu and Toshiba to merge their PC divisions together. Combined, the 3 would have challenged current Japanese market leader NEC Lenovo. Unfortunately, it appears that the talks have broken down for now.
The main breakdown in the negotiations was due to disagreements on how to merge assets. Japan Industrial Partners, the majority owner of VAIO, wanted to cut as much fat as possible during the merger. Fujitec on the other hand, wanted to keep as many of their current assets as possible and wanted to minimize restructuring. Toshiba seemed to be in no rush to close a deal even as their finances plunged even more into the red.
As the situation continues to deteriorate for the 3 firms, they may soon be back at the table to hammer out a deal. Combined, they would have over 30% of the domestic and just over 3% of the global market. That just might be enough to save them from disappearing. On their own though, they are unlikely to stand a chance of lasting any sustained period of time.
After being spun off from Sony two years ago, it looks like VAIO is planning to expand its PC operations. Despite the doom and gloom in the PC market, VAIO is reportedly planning a merger with the PC divisions of Toshiba and Fujitec, two other major Japanese PC OEMs. In fact, Japan Industrial Partners Inc, the owners of VAIO, are expected to hold the largest stake in the new firm and expects the consolidation will streamline the operation. The new company would rival NEC Lenovo in the Japanese market with a third of marketshare.
For Toshiba and Fujitec, this presents a good opportunity for them to get out of a market which has not much for them in the last while. Toshiba, in particular, is already trying to get rid of their less profitable divisions already and focus on NAND. By merging, the new as yet to be named firm has a will be able to leverage it’s now stronger domestic presence and make a bid for the international market as a whole, something VAIO has been trying to do.
In the current race to the bottom, there are only a few major players left like ASUS, HP, Dell, Lenovo, Samsung and Acer have any significant presence and some of them aren’t doing quite well right now. Windows 10 has largely failed to help spur new growth and there seems to be little relief in sight. If the continued survival of a Japanese PC maker means a merger, it will happen sooner or later.
After it was sold off by Sony to a Japanese investment fund in February 2014, VAIO was steered towards the domestic market, and it looked like it would remain on this course for a long time. However, in a rather unexpected move, the independent VAIO Corp has stated that it wants to start selling products on the international market once more, and its first targets are going to be the United States and Brazil. These new VAIO products will not be affordable and will be targeted at specific users such as designers and photographers who are currently using other products.
The first new VAIO product to be sold in the USA will be the powerful VAIO Canvas Z – an impressive tablet that boasts an Intel i7 processor, up to 16GB of onboard memory, a 256GB SSD and a detachable keyboard. The Canvas Z will cost $2,199 and will be retailed via Microsoft stores and on VAIO’s own US website starting October 5. Those who are interested in pre-ordering this tablet will be able to do so starting September. No word on availability or pricing for the Brazilian market just yet, though.
It appears that VAIO is also looking to expand into other markets, as it plans to build wearables, communication devices, entertainment robots and factory-automation machines. In any case, things are not looking too good for the company at the moment if we’re to consider the fact that its market share has fallen to less than 1 percent in Japan. If it would manage to gain a profit by this year’s end, VAIO could be sold to giants such as Apple, Microsoft or even Sony.
Thank you TheVerge for providing us with this information.
Sony has issued a product recall of thousands of VAIO “Fit 11a/ Flip” notebooks sold in the USA between February and April of this year. The issues with the product’s bearing the model number SVF11N13CXS are that the batteries used are dangerous. The Panasonic manufactured lithium-ion batteries can overheat and cause fire or burn hazards to users. As of making the announcement no injuries have been reported from the four incidents which have occurred. All four incidents occurred in Asia and overheating baterries led to “units smoking, catching fire and melting”. Owners of SVF11N13CXS model number VAIO flip notebooks are advised to immediately stop using their devices, check ifn they need to be returned and then contact sony for a repair or full refund.
Earlier this year Sony made an announcement that their long-standing VAIO notebook and PC sub-brand was to be drawn to a close after a period of poor financial gains and instead the VAIO resources were to be moved over to the already growing mobile department where smartphones such as the Xperia and a number of tablets were proving to be more popular.
Now only five months later, Sony have announced the resurrection of the VAIO brand, although this time it will be setup and run as a company in its own right trading under the VAIO Corporation name tag. Although the VAIO brand will effectively have nothing to do with Sony, Sony are keeping a five percent share in the business, with VAIO products being made available through the Sony online stores.
To get the business up, running and stable, VAIO will run at a considerably smaller scale, with sales and production limited to Japan for the time being, with no more that 240 employees running the outfit. There are no indications that the brand will be expanding outside of Japan in the near future.
It’s certainly no secret that Sony have been having a rough time over the last few years, although now that I think about it, there aren’t that many companies in the same industry that haven’t had a tough time. Only last week we reported that Sony had its credit rating downgraded to junk status, and now they’re looking to offload their Vaio PC business.
Sony is far from down and out, its console business is currently booming and its enough to stem the losses of the TV and PC market, which have been struggling against fierce competition from their many rivals. While talking to the team at Pocket-lint, a company spokes person for Sony said “Sony continues to address various options for the PC business”.
The offer looks like the unit may go on sale for around $490 million, and would not only give Sony a big pile of cash that they can better use elsewhere, such as in their smartphone and gaming business to help boost profits, but it’ll also mean they’re no longer having to worry about loosing money on the PC side of their business. The Vaio name is a great one, they’ve got many great systems to their name over the years, but with so many offerings on the market these days aswell as the gains in market share for tablets, it can be easy to see how Sony are having a hard time.
Despite rumours of a joint venture between Sony and Lenovo, which Sony firmly denied, Sony have claimed they’re more likely to sell its Vaio business to a private investment firm.
Thank you Pocket Lint for providing us with this information.