JOINT VENTURE

- SAAJAN RATHOD (19)

Joint Venture
A joint venture is an entity formed between two or more parties to undertake economic activity together. In Joint Venture, the parties (generally 2) agree to create a new entity by both contributing equity, and they then share in the revenues, expenses, and control of the enterprise. The venture can be for one specific project only, or a continuing business relationship such as the Sony Ericsson joint venture

JOINT VENTURE

Introduction to Sony

Sony Corporation is a Japanese multinational based in Tokyo. One of the leading manufacturers of electronics, video, communications, gaming consoles and information technology products for the consumer and professional markets, which developed the company into one of the world's richest companies.

Introduction to Ericsson

Ericsson is a leading Swedish-based provider of telecommunication and data communication systems. Throughout the 1990s, Ericsson held a 35-40% market share of installed cellular telephone systems. The handsets division got a fresh start in 2001 in the form of a joint venture with Sony called Sony Ericsson.

Sony Ericsson

Sony Ericsson is a joint venture established in 2001 to make mobile phones. 50:50 joint venture It was established on October 2001

The mosy widely known reason for this venture is to combine Sony's consumer electronics expertise with Ericsson's technological leadership in the communications sector by creating exceptional handsets.

Brands
Their branding includes: Older Ericsson style phones Cyber-shot-Camera-focused phones T-Mobile-network exclusive phones Vodafone-network exclusive phones, gaming focused phones

Cyber-shot (partial),3G (partial)-All around phones Walkman-Music focused phones Xperia-Covergence and powerhouse devices Ze Bobber-Design oriented phones/clamshells

Does this new offering set company in new Direction Mobile World Congress 2008
Sony Ericsson presented Xperia X1 the latest smart phone and the first one that runs on Windows Mobile 6.1. XPERIA X1 is a step in a new direction for the company, pushing a large, tactile QWERTY keyboard (hidden under a curved "arc-slider") as well as Windows Mobile 6

Xperia X1

This product is a premium, converged mobile experience addressing web communication and multimedia entertainment.

Sony Ericsson Xperia X1

Target Market

Demographic: 25-35 old Adoption: Early Adopters Occupation: Officials and business people trend setters who are susceptive to design Social class: Upper middles, lower uppers Psychographic lifestyle: Technical-oriented, businessoriented, design-oriented User status: Regular users

Features and Benefits

3- inch WVGA resistive touch screen 3.2-megapixel camera QWERTY keyboard GPS WiFi

Product Promotional Campaign

The first 1,000 customers will get their names engraved on their X1 and luxurious leather phone case for free, making it truly personalized. Sony Ericsson, through Sony Korea's existing network, is offering more than 69 service centers for Xperia users around the country.

Road to SUCCESS
Early hurdles

Initial losses reported till Q2 2003 quarter after another Market share fallen from 9% to 6% Q1 2003: Revenues fell from 1.1bn (Q1 2002) to 806mn euros Pressure from parent companies to attain profitability or face closure
Regardless of the continuous under achievment, experts were still confident of resurrection.

Turn of FORTUNES

Sony Ericsson posts its first profits in Q4 2003 since inception Sony Ericsson attains well over 9 % of the market share in Q2 2007 Additional expense of trademark royalty fees paid to the parent companies recorded for the first time in Q2 2007 Jan 2007, Sony Ericsson announces setting up production plants in India to meet the growing market Sony Ericsson scores continues scoring profits in Q1 2008.

Financial Information

Sony Ericsson posted its first profit in the second half of 2003. Since then, the sales figures from phones have been: 2004: 42 million units 2005: 50 million units 2006: 74 million units 2007: 103.4 million units Sony Ericsson sold 60m music enabled phones in 2006 underlining how its products are more popular than Apple's iPod. Apple sold 46m iPods in 2006. According to the Swedish Magazine M3s issue 7/2006 Sony Ericsson is the best-selling phone brand in the Nordic countries, followed by Nokia.

Conclusion

With a 43% annual growth rate, it became the fastestgrowing mobile vendor in Q3 2006 compared to Motorola with a rate of 39%. In 2007, Sony Ericsson had surpassed Nokia to become the most profitable mobile phone maker in terms of net profit rate. Sony Ericsson continues eating into the market share of the market leaders and experts still have faith in it to break the eternal leadership of Nokia in the industry with its ever growing innovation in mobile technology.