Sony’s ‘Premium Standard Model’ smartphones will be dropped, as confirmed by the company at its 2017 Investor Day yesterday. Such devices include the Sony Xperia X and Xperia X Compact that were released last year, with this particular tier aimed at offering near flagship specs at more competitive prices. However, sales of this level of phones have fallen short of expectations, leading Sony to state that it will now concentrate on mid-range devices such as the Xperia XA1 and flagship devices such as the Xperia XZ Premium from now on.
When the ‘Premium Standard’ Xperia X and Xperia X Compact were introduced there was a certain amount of indifference among consumers who were hoping for ‘true’ flagship devices. Sales were better in Japan where they achieved 85% of yearly volume target sales, but in other markets unit sales dropped drastically to only 31% of the targets. By comparison, sales of the Xperia XZ and Xperia X Performance flagships met 104% of unit sale targets in Japan and 60% outside Japan. For the remainder of 2017 Sony will attempt to restore market share, and in a bid to do so the company referred to using technologies “that only Samsung can deliver.” Another strategy going forward is to focus on markets that include Japan, East Asia, APAC, and Europe, where the company feels it can improve the strength of the brand. While Sony discussed North America as an area of possible growth, with plans to further distinguish the smartphones that it offers, the company acknowledges that a massive amount of investment is needed to drive forward in this market. India is seen as another market with potential for future growth, although the company recognizes that this could be more difficult due to the popularity of budget low-end handsets with small profit margins in the country.
Growth initiatives for 2018 and beyond include improving the product competitiveness of its smartphones, the development of new communication devices, and growing recurring revenue through its business portfolio. This follows news just last month from Sony President Kazuo Hirai, who spoke about upcoming changes in the smartphone industry. Talking about mobile technology for the future, Hirai said that virtual reality (VR) solutions would play a more notable role in the consumer electronics industry, and forecast that smartphones as we currently know them would cease to exist within the next decade.
