Origins The Swedish company
Ericsson had been making mobile cell phones since the 1980s, with their very first handheld device being the Hotline Pocket introduced in 1987. In the United States, Ericsson partnered with
General Electric in the early nineties as
Ericsson Mobile Communications (ECS), primarily to establish a US presence and brand recognition. General Electric eventually left the joint venture. Ericsson had decided to obtain chips for its phones from a single source—a
Philips facility in
New Mexico. On March 17, 2000, a fire at the Philips factory contaminated the sterile facility. Philips assured Ericsson and
Nokia (their other major customer) that production would be delayed for no more than a week. When it became clear that production would actually be compromised for months, Ericsson was faced with a serious shortage. Nokia had already begun to obtain parts from alternative sources, but Ericsson's position was much worse as production of current models and the launch of new ones was held up. Ericsson, which had been in the mobile phone market for decades, and was the world's third largest cellular telephone handset maker at the time behind Nokia and
Motorola, was struggling with huge losses and decreasing market share. This was partly due to this fire as well as its inability to produce cheaper phones or fashionably-designed phones like Nokia managed to do. Speculation began about a possible sale by Ericsson of its
mobile phone division, but the company's president, Kurt Hellström, said it had no plans to do so. Hellström said, "Mobile phones are really a core business for Ericsson. We wouldn't be as successful (in networks) if we didn't have phones".
Sony was a marginal player in the worldwide mobile phone market with a share of less than 1 percent in 2000. By August 2001, the two companies had finalised the terms of the merger announced in April. Ericsson contributed a majority of the
Ericsson Mobile Communications company, excluding a minor part spun off as
Ericsson Mobile Platforms. Sony contributed its entire handset division. The company was to have an initial workforce of 3,500 employees.
2001 to 2010 , the company's first hit product Sony Ericsson's strategy was to release new models capable of digital photography as well as other multimedia capabilities such as downloading and viewing video clips and personal information management capabilities. To this end, it released several new models which had built-in
digital camera and colour screen which were novelties at that time - examples include the
Sony Ericsson T610, the
P800 UIQ smartphone, and later the
K700 handset. The joint venture continued to make bigger losses in spite of booming sales - however it paid off as Sony Ericsson made its first profit in 2003 i In 2005, Sony Ericsson introduced the
K750i with a 2
megapixel camera, as well as its platform mate, the
W800i, the first of the Walkman phones capable of 30 hours of music playback. Later in October 2005, Sony Ericsson presented the first mobile phone based on
UIQ 3, the
P990. Also in 2005, Sony Ericsson agreed to become the global title sponsor for the
WTA Tour in a deal worth $88 million US dollars over 6 years. The women's pro tennis circuit was renamed the Sony Ericsson WTA Tour. Just over a month later on June 7, it announced sponsorship of
West Indian batsmen
Chris Gayle and
Ramnaresh Sarwan. In 2007, the company's first 5-Megapixel camera phone, the
Sony Ericsson K850i, was announced followed in 2008 by the
C905, the world's first 8.1-Megapixel camera phone. At
Mobile World Congress 2009, Sony Ericsson unveiled the first 12-Megapixel camera phone, named
Satio. On January 2, 2009, Sony Ericsson announced in
Stockholm that it would have some of its mobile phones made in India, and that its two outsourcing partners,
Flextronics and
Foxconn would manufacture ten million mobile phones per year by 2009. CEO
Miles Flint announced at a press conference held with India's communications minister
Dayanidhi Maran in
Chennai that India was one of the fastest growing markets in the world and a priority market for Sony Ericsson with 105 million users of GSM mobile telephones. Sony Ericsson's handset shipments fell from a high of 30.8m in Q4 1999 to only 8.1m in Q1 2003. The company had made net losses in six of the 15 quarters and seen its cash reserves shrink from €2.2bn to €599m, after taking a €375m cash injection from its joint owners. The eclipse of the
Symbian operating system, initially by Apple's iPhone, and then by
Google's
Android, has affected Sony Ericsson's position in the market. The company also struggled following the launch of
Apple's iPhone in the third quarter of 2007. Sony Ericsson was overtaken by its South Korean rival
LG Electronics in
Q1 2008. Sony Ericsson's company's profits fell significantly by 43% to €133 million (approx. US$180 million), sales falling by 8% and market share falling from 9.4% to 7.9%, despite favourable conditions that the handset market was expected to grow by 10% in 2008. Sony Ericsson announced another profit warning in June 2008 and saw net profit crash by 97% in Q2 2008, announcing that it would cut 2,000 jobs, leading to wide fear that Sony Ericsson was on the verge of decline along with its struggling rival,
Motorola. In Q3 the profits were much on the same level, however November and December saw increased profits along with new models being released such as the
C905 being one of the top sellers across the United Kingdom. In June 2008, Sony Ericsson had about 8,200 employees, it then launched a cost-cutting program and by the end of 2009 it had slashed its global workforce by around 5,000 people. It has also closed R&D centres in Chadwick House,
Birchwood (
Warrington) in the UK; Miami, Seattle, San Diego and
RTP (Raleigh, NC) in the USA; The Chennai Unit (
Tamil Nadu) in India; Hässleholm and Kista in Sweden and operations in the Netherlands. The
UIQ centres in London and Budapest were also closed,
UIQ was a joint venture with
Motorola which began life in the 1990s. At their keynote at the
2012 Consumer Electronics Show, Sony's
Kaz Hirai announced that the Sony Ericsson Mobile Communications name would be shortened to Sony Mobile Communications pending completion of the transaction. On January 26, 2012, the European Union approved the buyout. On February 16, 2012, Sony announced it had completed the full acquisition of Sony Ericsson. Since the acquisition, the first Sony-only mobile was the
Sony Xperia S at the 2012 Consumer Electronics Show. In May 2012, Sony Mobile Communications announced that it would phase out all the feature (non-smart) phones in favor of "smartphones" by September 2012. Sony Mobile was the fourth-largest
smartphone manufacturer by market share in the fourth quarter of 2012 with 9.8 million units shipped. On July 2, 2012, Sony announced it was buying Gaikai, a cloud service to support its expansion into the cloud gaming realm. Sony paid a reported $380 million to acquire
Gaikai. The Sony Ericsson Liquid Energy Logo, which was the hallmark logo used on Sony Mobile products up until the 2012 series of phones, was replaced with a new power button designed as the new signature hallmark to easily identify a Sony phone and this debuted with the 2013 series of Xperia mobile phones. The last phones to feature the Liquid Energy logo were the
Sony Xperia T and
Sony Xperia TX, and the first phones without featuring it were the
Sony Xperia J and
Sony Xperia V. Both were unveiled at the
IFA 2012. At the 2013 Consumer Electronics Show the
Sony Xperia Z and
Sony Xperia ZL were announced, followed by the
Sony Xperia Z1, unveiled during a press conference in IFA 2013, the
Sony Xperia Z2 during the 2014
Mobile World Congress in
Barcelona, Spain, and the
Sony Xperia Z3 in IFA 2014. On October 30, 2014, Sony announced that Senior Vice President of Corporate Planning, Finance and New Business Creation Department Hiroki Totoki will replace Kunimasa Suzuki as president and CEO of Sony Mobile Communications with effect from November 16, 2014. Suzuki subsequently became the Group Executive of Sony Corporation after his departure from Sony Mobile Communications. In the last quarter of 2015, Sony Mobile had the highest per-handset-profit and average selling price of all major Android handset manufacturers. However, in terms of market share, Sony Mobile dropped out of the top 10 smartphone vendors globally for the first time in the first quarter of the year. Sony Mobile has been the only major smartphone OEM that has given support to developing communities of smaller, hacker-focused mobile operating systems during this time. In 2013 Sony released an experimental
Firefox OS ROM for the
Sony Xperia E device. In 2017 Sony got
Sailfish OS into its Open Devices program. As a result, the Sailfish software has been officially ported to many Xperia devices. As of Q2 2018, Sony Mobile's smartphone market share in Japan was 12.5%, behind
Apple and
Sharp. On March 26, 2020, Sony announced that it will establish an intermediate holding company "Sony Electronics Corporation" effective April 1, 2020. Sony Electronics Corporation will incorporate the three businesses that comprise its Electronics Products & Solutions ("EP&S") segment (Imaging Products & Solutions, Home Entertainment & Sound, and Mobile Communications) and related global sales and marketing, manufacturing, logistics, procurement and engineering platforms. == Operations ==