Mobile devices Toolkit

Ericsson and Sony confirm mobile tie-up

Graeme Wearden ZDNet.co.uk

Published: 24 Apr 2001 12:23 BST

Ericsson confirmed on Tuesday that it was attempting to revitalise its mobile phone business by teaming up with Japanese consumer electronics giant Sony to create a new handset brand.

The two companies will merge their respective operations and form a new joint venture, called Sony Ericsson Mobile Communications, which will be based in London. The news comes after a difficult few months for Ericsson. It said on Friday that it was cutting 12,000 jobs worldwide after making a loss of over £330m in the first three months of this year.

Ericsson's share of the global mobile phone market has been falling in recent times. Industry experts have criticised the company for producing inferior handsets compared to market-leader Nokia, and Ericsson executives have claimed that Sony will provide complementary skills.

"We need a deeper understanding of consumer electronics, of entertainment, audio video and design. I don't think we could have found a better partner than Sony for this," said Ericsson's chief executive Kurt Hellstrom at a press conference on Tuesday.

Ericsson currently controls 10.7 percent of the mobile phone market, compared to Sony's 0.9 percent. Despite this difference, the new venture will be split 50:50. The two companies claim to be aiming for a 12 percent market share in the short to medium term.

Sony will contribute 1,000 employees to the new company, with 2,500 coming from Ericsson. Both companies are keen to emphasise that Sony Ericsson Mobile Communications will concentrate on designing new phones, and will not be concerned with manufacturing. Ericsson has already outsourced production at its two UK-based handset factories to Singapore-based Flextronics.

Sony Ericsson Mobile Communications will begin operations on 1st October this year.

See techTrader for technology investment news, plus quotes and research.

Have your say instantly, and see what others have said. Click on the TalkBack button and go to the techTrader forum

Let the editors know what you think in the Mailroom. And read what others have said.

Did you find this article useful?
50 out of 93 people found this useful

More In Mobile devices

Company/Topic Alerts

Create a new alert from the list below:

Related Jobs

Business Systems Analyst London - 42000-45000

My client is a leading global electronics and gaming company and they are currently seeking a Business Systems Analyst with at least 4 years ...

ELECTRONICS MANAGER - South Lancashire

Computer Futures Solutions are currently seeking an additional Electronics professional to join our client's team. It is expected that you will bring ...

Surrey/35K-40K/HW Design/RF/embedded/C

Collaboration with partners worldwide (who offer for example radio receiver hardware components to work with our software), to solve the customers ...

Featured Talkback

Put simply, what is the compelling reason to pay ~$200 extra for an Eee with Windows XP? A Windows Eee won't come with any useful applications and you'll have to buy anti-virus software to boot. The truth about low cost computing is that nobody really cares whether the machine is running Windows or Linux as long as its cheap, its easy to use and it works.