On Friday, Sony announced it is selling its New York headquarters for $1.1 billion. The move seems drastic, but normal operations will continue as the company will still rent out and use the office space for at least three years.
After the deal closes in March, Sony is expected to gain $770 million. That's a lot of cash for a company whose many divisions are bleeding money. It's also a nice way to profit off of property it acquired for $236 million.
According to the press release, "Sony is undertaking a range of initiatives to strengthen its financial foundation and business competitiveness and for future growth."
The Japanese company has been struggling for some time now; its television division hasn't been in the black for nine years, while fierce competition in the mobile and smartphone arena has left Sony unable to make a dent in the marketplace. In the gaming field, too, the company's handhelds and consoles have struggled, with the PlayStation 3 only recently becoming profitable.
Sony CEO Kazuo Hirai admitted to the company's troubles on Thursday, saying many projects became held up in bureaucracy and, in turn, slowed down the business' ability to react.
"I'm shepherding several of those projects personally myself to make sure that it doesn't get held up in the bureaucracy, or it doesn't suddenly fade away in the approval process," said Hirai to the Associated Press.
Still, although Hirai knows the company faces an uphill battle, he said it's headed in the right direction, as the company is more agile and focused since he took over nine months ago. He pointed to the new waterproof Xperia Z smartphone and 4K Ultra HDTVs that were received warmly at the International CES.
Those familiar with Sony's business practices still have their doubts, however. Yasunori Tateishi wrote a book on a company's downward trend, and said that the same problems that have overwhelmed the company for years can still affect it now if improvements in products aren't apparent.
"Sony needs to show that it is showcasing its unique imagery technology, not doing something everyone is doing," he said. "It needs to create new sectors in the electronics market. Otherwise, it's stuck fighting over the crumbs of the same pie."
