To: mpegleg who wrote (31984 ) 4/8/1998 1:58:00 PM From: Stoctrash Read Replies (1) | Respond to of 50808
Analysts Praise Sony's Tie-up With Microsoft By Kayako Watanabe dailynews.yahoo.com (Gorrilla + Gorrilla = "CE/Media Monster" ...imo...) TOKYO (Reuters) - Plans to tie-up with Microsoft could allow Sony Corp to become a leader in the digital consumer electronics industry, analysts said. "I give high marks to the tie-up plan," said Masayuki Yonezawa, an analyst at New Japan Securities. "It will not benefit Sony's earnings immediately but it will help the company to build a solid medium- and long-term business foundation," he said. Microsoft, the global leader in personal computer (PC) software, and electronics giant Sony announced on Tuesday that they had agreed to collaborate to create a convergence of the PC and consumer audiovisual electronics platforms. "The tie-up plan between the big names surprised me," a spokeswoman for Toshiba Corp said. "We'll need to take the alliance into consideration when we form our business strategies for the future," she said, adding that she did not know what kind of impact the plan would have on Toshiba and the industry. The announcement failed to sharply boost Sony's share price in Tokyo on Wednesday as investors were also puzzled as to how the plan might benefit Sony's business. Sony finished up 200 yen at 11,200 on Wednesday after rising as high as 11,400 at one point earlier in the day. Yoshiharu Izumi, an analyst at SBC Warburg, said, however, the plan will accelerate the ongoing trend toward digitization in the home electronics appliance industry and intensify competition. The two firms said they planned to cross-license key software technology. Sony intends to license Microsoft's Windows CE operating system in certain future products and Microsoft intends to license Sony's home networking technology. For Sony, which is aiming to create a network of different types of home-use AV products, licensing the leading operating system was a great help for building an effective and easy-to- use home network, analysts said. They said Sony was considering a home network which would be centered around a machine to be used both as a PC and a television set for terrestrial, cable and satellite broadcast programs. The network would include various digital appliances such as a digital camera, DVD player and printer, they said. Analysts said the alliance, which some suspect might develop into deeper cooperation beyond licensing of Windows CE, may allow Sony to become a digital electronics industry leader. "A company which starts a business ahead of everyone else on a large scale conquers the industry," Izumi said. "The possibility is high that the outcome of the two firms' alliance will become the de facto standard for digital electronics products for home use," Yonezawa said, adding that it would give Sony a solid business base for the future. Analysts said Matsushita Electric Industrial may be the only firm to match Sony in the Japanese digital electronics market. Their weaker rivals may face difficult situations, analysts said. "Fusion of televisions and computers are a natural course, Generally, the industry will see lots of alliances in which companies help each other," a Matsushita spokesman said without elaborating.