Sony Exits PC Business with Sale of Vaio Division

Sony is getting out of PCs. The technology firm announced Thursday it would sell its once-promising Vaio PC brand to a Japanese investment firm.

The firm, Japan Industrial Partners, will set up another company to make and sell the Vaio PC to consumer and business users, but only in Japan for now. The financial terms of the deal were not made public, although some news reports suggest the deal is worth as much as $494 million. Sony will have a 5 percent ownership of the new Vaio company.

Sony will also spin off its TV unit as a wholly owned subsidiary to focus on the 4K Ultra High Definition TV market that could prove promising, although currently 4K sets are very expensive. Sony President and CEO Kazuo Hirai has told news media that "the 4K market segment is expected to grow," with the TV subsidiary better positioned to respond quickly to market conditions. Sony's smartphones are handled by Sony Mobile Communications, and its PlayStation video game consoles by Sony Computer Entertainment, both of which are wholly owned subsidiaries.

5,000 Jobs

The Vaio brand, launched in 1996, attempted to set a new standard for multimedia computers -- Vaio reportedly came from the acronym for Video Audio Integrated Operation -- but the PC unit has been unprofitable in recent years. Several hundred PC-related employees at Sony will move to the new company, and existing PC customers will continue to receive after-care customer services for an unspecified amount of time.

Overall, Sony will reduce its workforce by 5,000 positions by March of next year because of this restructuring, in addition to reducing costs at its headquarters by nearly a third. The company has a total workforce of 145,000.

On the devices front, Sony will focus now on mobile, including tablets as well as smartphones, with...

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