The Buzz: Time to consider the unthinkable?

sony - The Times: Sony to abolish 'several...

Sony sources have told respected UK newspaper The Times that the company is bracing itself for a series of "sacred cow-slaying" measures that will abolish or fundamentally alter many of its long-established business practices.

According to the report, the restructuring is likely to be announced early next month, with changes predominantly impacting Sony's domestic Japanese operations in the form of factory closures and the abolition of several major divisions.

The report has led to increased speculation that Sony might be prepared to do the unthinkable and pull out of the games console business, aping the fate of SEGA following the commercial failure of the Dreamcast.

While Sony has repeatedly claimed that the Sony PlayStation 3 is meeting sales targets, it currently lags behind the Nintendo Wii and Xbox 360.

According to official figures, as of September 30 2008 the PS3 had sold 16.84 million units worldwide following its release in November 2006.

In December, SCEE president David Reeves claimed that the PlayStation 3 was approximately 300,000 units ahead of the Xbox 360 in PAL territories, and denied his division would see any cuts.

He said: "We're relying on the fact that the industry will keep growing and while we might have a comparatively smaller share of the market we will have higher sales. PS3 is tracking where PS2 was at the same point in its life. The value added strategy will continue for some years to come.

"We will look at the economic forecasts. We will plan prudently. As long as we plan prudently then I think we will be fine. We have a good business model. People will continue to buy the hardware, continue to buy the software. I'm convinced of it."

Sony's video game business has recently come under attack, with some industry commentators labelling the PlayStation 3 a "sinking ship". November hardware sales in the US put the PS3 in third place, with the console selling fewer units in November 2008 than in the same period in 2007.

What do you think? Could Sony dramatically pull the plug on PlayStation? Let us know in the comments section below.