[Original Hacker News comment.]
I worked at Sony until about 18 months ago (European TV Product Planning and Business Development getting content onto the TV Internet platform).
This data makes it look like it could be going down quicker than I thought but it did have major problems and no clear route through them.
I think a lot of the engineering problem is that now the growth has gone there isn't large amounts of fresh recruits bringing new ideas. It also isn't THE place to work anymore which it once was in Japan (think Google 8 years ago levels of cool). The engineers are now mostly managers and outsourcing large amounts of development (particularly software to India). Manufacturing is outsourced so the benefits of having deep understanding of production and being able to optimise the products for that just isn't there. These combined outsourcings may be essential for short term survival but rob further from capability to differentiate and innovate.
Exchange rates are also killing Sony (and the other Japanese manufacturers). Massive proportions of their costs are in Japan and inflexible but their income is significantly in dollars and euros. They would be much better off if they spread their costs to regions where their income is.
The end of CRTs removed Sony's price premium in TV and Samsung at the high end and LG at the low end are brutal competitors in an industry where no-one is making money. However it is almost impossible to escape the TV industry as that would completely kill all the Sony franchise retailers (and with it a lot of other electronics sales) and any potential position as an entertainment platform/gateway company. It would also be a big admission of defeat and a lot of jobs would disappear.
A lack of real leadership has been a core problem but I'm not sure there is any way to fix it now.
Don't get me wrong many of the products are still really good and even competitively priced but that doesn't mean Sony is profiting on them. In TVs I think the processing on the mid-high models is better than most competitors and the internet services are pretty competitive but there is a lack of nimbleness and imagination to really take a lead in anything other than picture quality. The PS3 is a good value product these days.
Thinking about it some more I think the best chance of surviving into the medium term is some cataclysmic shift in exchange rates (maybe not so improbable given the Japanese Government debt). An effectively free drop of 20% in Japan based costs would give quite a massive boost that might give time to attack other problems but isn't enough on its own (assuming Sony's debts are in Yen as the value of many assets would also fall which could put them under before they could benefit from trading against the stronger currencies).Japan printing itself out of debt might be quite a good move although clearly not without its costs amongst savers.
Anyway getting well out my expertise here.
elchief > Man, I had a Sony Wega CRT, and I seriously couldn't tell the difference between it and the first incarnation of 720 flatscreens.
Yes the first flatscreens
were rubbish and for interlace SD video the best type of screen is a CRT
(the screen, the encoding and the transmission technology were all
built around each other to actually gain benefit from the weaknesses).
However the deinterlacing, upconversion and motion interpolation are massively different now to the first models. Plus content is available in HD (progressive) formats and you can get 1080P models.
A 40" LCD can be moved by one person and a 36"CRT would probably need two people to move it at all, was full of nasty chemicals, used more power and takes up more space in the room. If you still have a CRT that you use much it is probably worth replacing it, the phosphors will be substantially diminished in brightness so power consumption will need to be higher to achieve the same colours/brightness as before and HD video is truly here now.
Progress is amazing (even if there are the odd dips on the way). I joined Sony just as they were killing the non flat screen products.