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Boards approve Sony Ericsson venture
Wednesday, September 12 2001
by Stan Van Haasteren


The boards of Sony and Ericsson have approved their new mobile phone joint
venture, which will aim to become the world's leading mobile phone producer. 





The new company, Sony Ericsson Mobile Communications AB, will start operations on
October 1, it was announced in Stockholm on Tuesday. 





"The new company will be the number one in the mobile phones market," Ase
Lindskog, Ericsson's Director of Media Relations, stated confidently on
Wednesday. "Why shouldn't it? We have the knowledge for it." 





The mobile phones produced by the new company will be on the market from the
second half of 2002 onwards. It has not been announced yet what the brand name of
the new mobiles will be. The headquarters of the new company will be in London. 





"Sony Ericsson will focus on 3G (third generation) mobile phones," Lindskog
added, saying that 3G is the "main challenge" facing mobile phone companies.
"The new company will work primarily on marketing, branding and design, while
Ericsson will provide the chips for the mobiles," she said.





While the mobile phone division of Ericsson will merge with Sony, the Ericsson
parent company will continue to work on applications such as Bluetooth and mobile
platforms. 





The board of directors of Sony Ericsson will be roughly half Swedish and half
Japanese. Katsumi Ihara will be the President of Sony Ericsson, while Jan Wareby
will act as Executive Vice President. 





Lindskog did not comment on the possible consequences of the deal for the 2,400
Ericsson employees in Dublin, Athlone and Cork. A spokesperson of Ericsson
Ireland also refused to comment. ElectricNews.Net reported in July that job
losses in Ireland are a possibility, after Ericsson chief executive Kurt
Hellstrom said R&D programs may be cut.





The combined mobile phone sales of Ericsson and Sony were USD7.2 billion in 2000,
representing 50 million handsets. However, the mobile phone divisions of both
companies have reported losses recently. 





With the joint venture the companies hope to combine the consumer electronics
experience of Sony with Ericsson's wireless and telecommunications knowledge. 





More info at: http://www.ericsson.com and
http://www.world.sony.com.