The Stock of the 21st Century

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• The Stock of the 21st Century

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About Sony

• Sony Corporation of America, based in New York
  City, is a subsidiary of Sony Corporation
  headquartered in Tokyo. Sony Corporation is a
  leading manufacturer of audio, video,
  communications and information technology
  products for the consumer and professional
  markets. Its music, motion pictures, television
  production, computer entertainment operations and
  online businesses make Sony one of the most
  comprehensive entertainment companies in the
  world.
• Annual Sales / Sony Corporation consolidated
  56.6 billion, 18.0 billion in the U.S.
• Workforce 177,000 employees worldwide

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Why Buy Sony?

• The Electronic Age
• Brand Name
• Playstation 2
• Solid Leadership

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1. The Electronic Age

• Entertainment is becoming more and more
  technology-centered todays kids play computer
  games, not board games, adults will begin to
  watch DVDs rather than go to a play or theater
• Sony is the complete electronic company they
  co-developed the CD and DVD they invented a wide
  range of audio-visual products such as the
  Walkman, 3.5 inch floppy disks, the MiniDisc
  system, Aibo the robotic dog (sold 3,000 in 20
  minutes) and much more

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Sony Has Everything Covered
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Sony Vaio

• The PCV-L630 VAIO Slimtop LCD Computer delivers a
  unique non-conventional design combined with a
  high quality digital LCD display, slim-design CPU
  case, DVD-ROM drive and i.LINK interface that
  define a new generation of Internet and digital
  video ready computers ( thanks to www.sony.com)

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2. Brand Name Recognition

• Teens consider Sony the third coolest global
  brand (behind Nike and Tommy Hilfiger)
• Sony is known for quality and innovativeness

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3. Playstation 2
Presenting . . . . . .
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PS1 Not a Bad Start

• 1 out of 4 U.S. Households own one
• 70 million sold
• 40 of Sonys 1998 profits

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PS2 The complete entertainment system

• Runs PS1 titles also, but the new PS2 games make
  the old ones look like Pong (you can see
  teardrops, double-helix smoke trails from
  missiles, individual splatters of blood, etc.)
  there will be a ton of PS2 games launched this
  fall - Electronic Arts is making 10, including
  Madden NFL 2001
• Can play CDs and DVDs right out of the box
• In 2001, Sony adds Net connectivity and the
  ability to store and replay digital music and
  video from the web
• Emotion Engine fast, high-powered chip that
  puts out 20 million polygons a second (polygons
  are the building blocks of 3D graphics), compared
  to PS1s 360,000 polygons/second

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Videogames the right industry

• 7 Billion-Dollar Industry in U.S. alone
• Videogame revenue in 2000 is expected to surpass
  movie theater ticket sales

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PS2 Will it be popular?

• 1 million sold in Japan in one weekend
• 100 million to be produced
• Tecmo's Tomonobu Itagaki "I can create a more
  emotional world with more details and more
  realistic facial expressions. The physics will be
  more accurate. I'll be able to do smoke, fire and
  water. With current technology, the thickness of
  the fog is even throughout. With PlayStation 2,
  one part can be thin and another thick."

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PS2 Competitors

• Sega Dreamcast sold 4 million units in 1999
  (weak)
• Nintendo Dolphin too little, too late
• Microsoft X-Box Microsoft is popular with
  corporations, not teens too expensive the chip
  alone for X-Box costs 425, compared to 360 for
  the whole PS2

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4. Solid Leadership

• President Nobuyuki Idei
• His brash style represents a break from the firm
  autocracy that traditionally defined Sony (he
  drives a Porsche 911)
• Is trying to make Sony more digital, less
  industrial
• Goal connect all Sony products to the Web

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Possible Problems

• X-Box is more popular than expected
• Not enough good video game makers sign on PS2
  games are very expensive and difficult to create
  (the video game makers will adapt recently,
  Electronic Arts bought Dreamworks Interactive in
  order to boost its own PS2 game development)

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Babbages Best Buy
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Babbages Best Buy
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Financials