Sony CEO Stringer: You can't afford our best TV

CARLSBAD, Calif.--Sony CEO Howard Stringer says the culture of profitability has returned to his company. But, he says, it still has work to do.
In an interview with Stringer at the D6 technology and media conference, The Wall Street Journal's Walt Mossberg started by pointing out the failures of Sony's digital music player and interactive TV ventures. Stringer said that Sony is now running about 5 percent profit margins. Those margins need to get bigger to sustain the company, or, he says, "If we have any more success, we'll be bankrupt."
Speaking about the culture of the Japanese business he runs, he said it's difficult to adapt quickly--there's no laying off of white-collar workers or engineers. Hence, perhaps, his "get mad" rant last week. Stringer also delved into what's in Sony's future--from OLED TVs to game consoles and "craplets."
What's after LCD TVs?LCD growth is beyond expectations, Stringer said, but OLED technology, while still too expensive, is the next thing. Or the current thing, if you want to spend $2,500 for an 11-inch screen. Its contrast ratio is a million to one, he said, a hundred times brighter than an LCD screen.
In a bit of D6 showmanship, Stringer showed a new version of the screen that's only 0.3 millimeters thick, and that could be formed in curves "wrapped around your arm," he said. A 27-inch version will be out soon. "It will be quite expensive. The only people who could buy them will be in this room."
The technology will eventually supplant LCD, Stringer believes, although at the moment he calls it "a perfect television companion."
It appears that Sony is pushing this technology in part because it's actually manufacturing these panels, unlike many Sony-branded LCDs, which it sources from other vendors.
Game consoles and Blu-rayThe expense of the PlayStation 3 at first led to a "mildly catastrophic" profitability curve, Stringer said, but the prices are coming down and the game titles are generating profits. He said the next game coming out, in June, will use the "full capacity" of the console and will be "spectacular."
The console is beginning to become a platform for more than just games--a hub for the PSP, for example. The PlayStation Network was key to Sony winning the Blu-ray/HD-DVD battle, Stringer said, since the PS3 was a great movie-playing platform.
In standard Blu-ray players, Sony did lose money on the players as the company had to chase the HD-DVD player market and its $99 retail prices. But the studios supported the Blu-ray format, which made the bigger difference.
Mossberg asks how many years of value Sony will be able to eke from that victory, especially as the move is to digital distribution. "There's a long lead time," Stringer said, "before you get the quality, you get on Blu-ray." He thinks the media format will last for 10 years or beyond, especially as people migrate to better and better television screens.
"Had I lost that war," Stringer said, "the headline would have been, not that HD-DVD won, but that it was Betamax 2. That would have been on my tombstone."
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