Sony making up for lost time, focuses on Indian market

Sony Corporation's chairman, CEO and president, Howard Stinger was in Mumbai to inaugurate the Sony Media Technological Centre at the Whistling Woods Institute. Stinger took over the top job at the company in 2005 and since then has been at home, steering the iconic company through some of the most difficult times through its corporate history. CNBC-TV18's Anuradha Sengupta caught up with him and asked him about Sony's current view of the Indian market.

Sony, which makes personal and professional technology products at one end and entertainment content including movies, and music and television on the other, is betting big on the budding film makers here and believes that this market is a very important one for their growth.

Below is the transcript of his exclusive interview on CNBC-TV18. Also watch the accompanying video.

Q: What is the Sony Media and Technology Centre that you have started at the Whistling Woods Institute, a film-maker Subash Ghai institute in Mumbai, for?

A: It is to help film makers. Indian film makers are very strong, and the new technology is giving new opportunities to Indian film makers as well as everybody else. And this is such a powerful film centre in the world that we wanted one of our three technology centres here to create opportunities for students and beyond, to help transform the industry.

Q: Sony has been here since 1994, that's close to 17 years, and it's only in the past couple of years that the consumers in India have seen Sony recognise the potential of the Indian market. So everything from more launches, slightly more affordable prices, to more stores, to even zero-interest finance schemes, which Sony had never done before, all of this seems to be happening in the past couple of years. So what has changed?

A: Its recognition albeit a little than later than it should have that India had this enormous potential. We always had a problem because our costs were high and our prices were premium-that's the nature of the technology that we operate at. And I think in recent years it's become clear that this market is important.

My own relationship with India goes back a long way to my father living here for four or five years. So I was very happy that my staff in Tokyo got very excited about India and that's really been the reason for it. They are doing this because they are excited by India. The 'S' Sony Entertainment Television, which is the most powerful external channel we have in the studio is because the people who are in the Hollywood studio are excited by India and this is the nature of the progress. People suddenly discover something that was right in front of them and which we should have noticed before, but we are making up for lost time with our excitement and our enthusiasm.

Q: How are you evaluating the results of some of the steps that had been taken especially on the electronics side of the business?

A: When the sales topped USD 2 billion-that was a milestone that our senior executives had generated excitement about. When we first came to India we were going to double our sales and it was like doubling from 5 to 10; it was very small. So all of a sudden we were at USD 2 billion and counting. So with so many places in India, we touched the customer in so many ways-Sony Entertainment Television, the cricket that we covered, the video games starting in the society, I think we touched the customers in so many places if we get it right, we have an advantage.

Q: Do you feel though where the consumer electronics part of the business is and the television is being the crown jewel in that area that Sony had spent too long in getting aggressive in the Indian market because the Koreans have carved up the market within themselves?

A: Not really, we are number one in market share.

Q: In flat panel TVs?

A: In television and digital pseudo cameras, I think Koreans were quicker into the market to put factories here. But we obviously had an advantage because we have got Sony Entertainment Television and Sony Music and so forth. So I said earlier we weren't as fast as I would have liked, but we are fast now. And it's quite clear that our brand image is technically and statistically very strong and we are going in a right direction. The fact that we can do it here at Whistling Woods is testimony to both of us.

Q: Worldwide, what are the challenges that a technology company such as yours which started so many business across the globe, face?

A: That's both strength and a disadvantage. We never like to think of size as important because all these discipline now finally connect. We have been preaching that for a long time in Sony, but now they really do interrelate. You need content and technology to spin at the same time and it's finally happening. So that gives us a comfortable relationship with the customer that we haven't had before. In the rest of the world in the Europe for example where sales are not so good, most televisions and products like it, have been commoditised very quickly. There is a lot of competition not just from the Koreans, but from Chinese, prices are dropping, it's harder to make a profit. But our ability to integrate content and services with the new generation of television sets gives us hope that we can sustain our leadership position.

Q: In 2009, you changed the brand promise of Sony or the statement from "it's so Sony" to "make.believe". Was that a sense of purpose of what Sony, as a co-operation, stood for or where people are concerned or was that also because "it's a Sony" doesn't really help that much when it comes to the counter where the moment of truth happens with rumours?

A: It's not very descriptive. When we were alone in the market "it's a Sony" was the statement, "make.believe" is an attempt to suggest that our relation with the customer is increasingly a two-way relationship. As television and everything else becomes more interactive and as content and services migrate to all our products, not just the computer, then we would give him the opportunity to the local market place to be involved.

We hope that here, as we go forward, particularly with the Internet and television and alike, Indians will create their own content and migrate around the world. We have that capability in the small, large and intermediate you can use content to create excitement for our technology.

Q: What is brand Sony stand for today in the world where Apple creates buzz for the kind of marketing it does, where Google talks about Google TV where you are partners with. What does brand Sony stands for?

A: Apple concentrates on one product at a time very efficiently and markets it very expensively. We have multiple devices and multiple disciplines, which we are increasingly integrating. So the Sony brand is where the world's premier electronic entertainment brand. In the last three years, we have actually sold over a billion units and if you add to that the people our movies, music and our touch phones connect to, it's tremendous. Our touch phone among customers is greater than any other company in the world. But we do need to do a better job of explaining that to them. Apple comes out with one product and we come out with 60 products and sometimes you can't market all 60.

Q: So are you saying marketing is the problem where Sony is concerned?

A: Marketing is very hard when you have that many products. So we are changing our changing our tune with "make.believe". We are marketing the company for scale and not just individual products. So once you understand that the entertainment experience is delivered by an electronics company from a top to bottom or 3D from lens to the living room then I think Sony's brand will sell itself.