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Sony Buys out Ericsson from phone deal

Sony Buys out Ericsson from phone deal

Sony has announced that they are set to buyout their partner in crime, Ericsson, meaning in future they will receive near 100% of the profits from Sony Ericcson based mobiles. This is no small sum though, as Ericsson had a 50% stake in the joint venture, costing Sony an impressive $1.47 billion.

This marks a bit of an end to an era, as these two giants of the mobile game have been working together since October 1, 2001. Initially things didn’t go well, with both companies threatening to pull out if they didn’t turn things around. However, with further cash injections and a focus on multimedia – specifically getting high quality cameras into the handsets – SE turned things around, becoming quite a dominant player in the mobile game.

In recent years though, with the popularisation of smartphones, Sony Ericcson hasn’t remained as relevant, selling just 43 million units last year which is down from 103 million units in 2007.

In what is becoming increasingly important in this market, Sony has secured a IP cross licensing agreement which means they can continue to use the joint patents developed by Ericsson and Sony, which prevents the former company from suing Sony further down the line.

Apparently the deal is set to be finalised sometime early next year. The first Sony Ericsson handset that comes out after that should be quite interesting.

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