TOKYO — Sony on Wednesday picked Kazuo Hirai, a video game executive who led a turnaround of its PlayStation business, as its next president and chief executive, in a bid to regain some of its magic.
Mr. Hirai, 51, Sony’s chief of consumer electronics and games, had been widely expected to succeed Howard Stringer, who has led Sony as chief executive since 2005. Mr. Stringer, an American born in Wales and one of just a handful of foreign chief executives at large Japanese companies, will become chairman of the board on April 1, Sony said in a statement. Mr. Stringer already is Sony chairman, an executive position. He will move to a board seat that is not an executive post.
The maker of the Walkman music player in the 1970s, Sony could not translate that success to the digital area and now trails Apple in portable music players and smartphones. Once a pioneer in television technology, Sony has been muscled out of that market by its South Korean rivals Samsung and LG.Mr. Stringer’s drive to cut costs and streamline Sony’s sprawling operations briefly appeared to gain traction in the mid-2000s. Mr. Stringer, who is 69 and joined Sony’s American unit from CBS in 1997, has also tried — with varying degrees of success — to better integrate the company’s hardware business with its vast catalog of music, movies and video games. The popular PlayStation Network, which offers download of games, movies and television shows, has nearly 100 million subscribers.
But the global economic crisis, which caused a collapse in Japanese exports and a severe recession in Japan, stopped any meaningful Sony comeback. The earthquake and tsunami last March disrupted production at 10 Sony plants in northern Japan and severed vital supply chains; flooding in Thailand, the manufacturing hub, has also curtailed production.
An older issue, the stubbornly strong yen, continues to hurt Sony’s competitiveness overseas. Further clouding the outlook was an embarrassing hacker attack on its PlayStation network, which required it to shut down for about two months beginning last April and led to a breach of personal data from tens of millions of user accounts.In smartphones, Sony took complete control of a cumbersome joint venture with Ericsson of Sweden last year, freeing Sony engineers to move more quickly to match the iPhone’s dominance in the business.
Among the challenges Mr. Hirai inherits is dismantling what Mr. Stringer called Sony’s “silos.” Those internal divisions and rivalries have prevented Sony’s many parts from working well together and have driven a destructive competition that has confused product strategy.At various times, portable video players have been made by the Walkman group, the Vaio group and the video game unit, while Sony’s music and motion picture divisions often have not worked effectively with their colleagues in electronics to increase hardware sales.
