14 DAY TRIAL // Sony Ericsson, the Japanese-Swedish mobile phone developer, seems to be in more trouble than we previously believed. According to the latest news on the web, the joint venture is indeed in a desperate need to raise some funds one way or another, namely either by making new bank loans or through a fund injection from its parent companies, Sony and Ericsson.
It seems that a Sony spokeswoman has recently confirmed that the company has great financial problems, after Sony's Chief Financial Officer Nobuyuki Oneda stated the same not too long ago. The company's official seems to have said that Sony Ericsson would need to raise at least 100 million Euros ($135.5 million) in funds.
The joint venture has had financial difficulties for quite some time now, and it already tried to cut costs by slashing one in five jobs during the ongoing year, a move that would allow it to become profitable once again, though it is facing sluggish demand, translated into more losses during the first quarter of the year.
According to an official from the mobile phone maker, the company has started to see lower demand for its handsets as soon as the smartphone segment of the market began to see an impressive growth, as consumers were less interested in its feature phones. The fact that Sony Ericsson hasn't made a great entrance into the smartphone area has had negative effects on its market share, and now it is placed fifth on the worldwide mobile phone market, as it has lost the fourth position in Motorola's favor.
As for the fund raising that Sony Ericsson needs at the moment, it seems that the two parent companies haven't agreed yet on the details, but they will decide on them jointly in the future, at least this is what Sony spokeswoman Mami Imada is reported to have stated. Hopefully, the company will manage to put itself together, as there are a series of nice handsets that it should release into the wild in the near future, such as the 12.1-megapixel cameraphone Idou, which are currently under development and which should help the company regain some of the market share it has lost lately.