Sony pays €1.05bn to buy out Ericsson

Mobile handset business to become completely owned subsidiary

Sony Ericsson has announced that Sony itself will be buying out the Ericsson share of the mobile handset company for a €1.05 billion ($1.45bn) cash payment, although further incentives may also be involved.

"This acquisition makes sense for Sony and Ericsson, and it will make the difference for consumers, who want to connect with content wherever they are, whenever they want," said Sony chairman, president and CEO Howard Stringer.

"With a vibrant smartphone business and by gaining access to important strategic IP, notably a broad cross-license agreement, our four-screen strategy is in place. 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. This includes Sony's own acclaimed network services, like the PlayStation Network and Sony Entertainment Network."

The move puts Sony in the position of being able to integrate the company's mobile communication technology directly into other projects more easily, something which could be seen as a potential response to the accusations of 'over-specialising' the forthcoming PlayStation Vita.

Some industry figures and analysts have painted a bleak picture for that device, claiming that its unit price is too high for a dedicated gaming handheld in the face of opposition from smartphones.

A 3G model of the Vita is planned, but no telephonic capabilities have yet been announced for it, instead using the mobile signal for online play and downloads.

Ericsson itself will remain in the business of connectivity technology, said president and CEO Hans Vestburg.

"Ten years ago when we formed the joint venture, thereby combining Sony's consumer products knowledge with Ericsson's telecommunication technology expertise, it was a perfect match to drive the development of feature phones.

"Today we take an equally logical step as Sony acquires our stake in Sony Ericsson and makes it a part of its broad range of consumer devices. We will now enhance our focus on enabling connectivity for all devices, using our R&D and industry leading patent portfolio to realize a truly connected world."

The deal also puts Sony in control of a number of important and potentially lucrative mobile technology patent families - an area which has seen enormous interest from tech companies, with deals such as Google's acquisition of Motorola and the continuing legal battles between Apple and Samsung.

The most significant product from Sony Ericsson for gaming had been the recent Xperia Play, a long rumoured 'PlayStation' branded phone with a physical D-Pad and buttons designed to play games, including a back catalogue of PlayStation titles.

That handset stuttered somewhat at launch and recently went through a re-launching process, securing a timed mobile exclusive of Minecraft for the device.

Related stories

Sony's dev relations head departs - Report

Florian Hunziker leaves PlayStation maker after just a year on the job

By Brendan Sinclair

Latest comments (6)

Adam Campbell Game Production Manager, Azoomee6 years ago
Makes so much sense right now it hurts. The merger was a great idea back then, but I want to see Sony push a real ecosystem now between their devices - from the home to the portable sector. This means a stronger brand and far more control over decisions..

0Sign inorRegisterto rate and reply
Terence Gage Freelance writer 6 years ago
Seems like a good move by Sony, both in terms of putting all of their devices on a parity with one another and perhaps more importantly gaining some important technology patents.

I used to be a staunch Sony Ericsson consumer, but following their apparent flat entries to the smartphone market I went to HTC about a year ago. Their subsequent line-ups of phones appear to be much better, but it would take a really well-received piece of hardware to convince me to go back now.

Will they be keeping the Sony Ericsson name & logo, or will their phones just be branded Sony now?
0Sign inorRegisterto rate and reply
Greg Wilcox Creator, Destroy All Fanboys! 6 years ago
Excellent (and finally). Sony could have had a bigger presence in the mobile market ages ago, especially with all the connectivity between devices they tout (which isn't always true). Now, it seems they'll be integrating future Sony phones with their consoles, PC's and other products, but we'll see what happens as time marches on...
0Sign inorRegisterto rate and reply
Show all comments (6)
Oliver Birch Director of Marketing, Hothead Games6 years ago
The Xperia Play certainly has a challenge on it's hand(held)s.

Although I have never played it, mobile Minecraft sounds fun. A long term exclusive with FIFA12 Android is also in the back of the net, which seems like a superb catch for the device.
0Sign inorRegisterto rate and reply
Charles Dawkins6 years ago
Great move for Sony but I laugh because it seems like ever since Microsoft infringed on their world their whole strategy is copy whatever Microsoft is doing. The four screen approach! LOL, where have I heard that before. Oh yeah that sounds like Microsoft's three screen approach. I lack the respect for Sony with their consistent copying and lies. I respect Nintendo more because they carve their own niche. Nintendo's problem is lack of games. So Sony is joining the ecosystem game. I never really thought of them as a ecosystem but I guess they really do have one. Not quite as robust as Apple and to a greater extent Microsoft but this strategy is better for their product line. I'm just disappointed that Sony let Apple walk all over the Walkman brand.
0Sign inorRegisterto rate and reply
Charles Dawkins6 years ago
I also hope they drop the crappy Andriod because I would love a Sony Windows phone with the Playstation Suite and Xbox on the same phone. That would be heaven for me. Come on Sony stop the crap because Windows 8 is coming and Xbox will be imbedded in the OS so just add your flavor to it and make me happy. I'll buy my first Sony Laptop or Tablet if you do that. Just do me a favor and lower your prices.
0Sign inorRegisterto rate and reply

Sign in to contribute

Need an account? Register now.