Is Sony Relevant Anymore?

Sony Corp. SNE this morning that it expects to post a loss for fiscal 2011 of around $3.2 billion, as a plethora of problems have plagued the Japanese electronics giant this year. From production disruption related to the devastation in Japan, to an attack on its its online gaming service, it has been one thing after another for the company. The Japanese company said the loss was mostly related to writing off a $4.4 billion tax credit that the company booked in the previous quarter. Prior to announcing the $3.2 billion loss, Sony had predicted it would earn $860 million. Sony, along with other Japanese manufacturers, has been hurt severely by the devastation caused by the March 11 earthquake and subsequent tsunami that led to the death of more than 25,000 people. It's also essentially sent the Japanese economic into a tailspin, and destroyed factories all though out the country. So this begs the question. Is Sony really relevant anymore? Yes and no. Sony is relevant in the fact that the company produces so many electronics, from TVs, to Playstation 3's, to computers, and other electronics. It is not relevant in the sense that Sony is no longer a "must-have" product for people to have, and has not been for some time. Apple AAPL has overtaken Sony as the "must-have" electronics company, as it produces its iPads, iPhones, and iPods. Masaru Kato, Sony's chief financial officer blamed the parts shortages potentially for the loss. "In the first quarter, we saw quite a major impact on our manufacturing activities," he said. With Sony's reputation following the security breach at an all-time low, Sony has to restore its reputation, and an impact product can help it do so. The company has seen its flat-panel TVs and other gadgets fall sharply. The TV business has not been profitable for seven years now. The company, which made such iconic devices as the Walkman, and Playstation, needs to do something to get its cache and brand awareness back. It needs to differentiate itself from its competitors. I am not sure how it plans on doing this, but it almost feels as if Sony is starting to become the Microsoft MSFT of Japan. Does a little bit of everything, but not particularly good at anything. That needs to change, and fast.