SONY Development History

Technicians’ Dream

CBS SONY, which is relatively late in the recording industry, has cultivated Japan’s first large-scale music conglomerate and will Columbia Pictures' performance pushed it to No. 1 in the United States. "SONY", the hardware company that knows the most about software, is a "technology-based enterprise company."

Akio Morita, chairman of SONY, fully revealed this feature when talking about the development history of SONY: "This is a series of stories about realizing Mr. Ibuka's dream."

SONY The founder, Mr. Ibuka, has been a famous scientist and inventor since before the Pacific War. Morita and Ibuka met when they were assigned to the Naval Technical Admiral's Research Institute. After Morita acquired Columbia Pictures, he made the following remarks at a press conference: "SONY, a company founded by technicians, took the software industry as an opportunity." Hardware without software cannot become a truly big business. ”

In order to expand the hardware business, the software business is absolutely necessary. This is the conclusion that SONY has concluded for many years. SONY, which has invested huge amounts of money to acquire software companies, is the company that knows the software industry best. Even if After SONY invested a huge amount of money to acquire Columbia Pictures, it never let the hardware-first and software-secondary concept collapse.

In October 1989, Sony announced its acquisition of Columbia Pictures. , caused a strong response in the United States. In the headline of NEWS WEEK, the Statue of Liberty was put into a kimono, with the title "Japan bought the soul of America", which caused considerable criticism in the United States (because of the title of the film produced by Colombia. (using the Statue of Liberty). In addition to openly countering such remarks, Morita expressed in an interview in Japan that he was very disappointed with the United States.

The reason for the so-called disappointment is quite mysterious. Some people in Japan and the United States also pointed out why no one made any criticism when Australian capital acquired MGM/UA (MGM) and 20th Century FOXS (Fox). This is simply racial discrimination.

But it was not because of this that Morita concluded that he was disappointed with the United States: "When I gave a speech in the United States, I mentioned why no one said anything when CA was sold to the French. This is the fundamental reason for the United States. on the problem. When I was a child, I loved electricity and was crazy about radios. RCA is the representative of the high-tech industry in the United States. After the war, the Japanese electronics industry all asked RCA to buy patent rights. Therefore, for me, who comes from a technical background, RCA is the source that represents the soul of America. GE purchased the RCA Institute and RCA, which were later sold to French companies. This is a big deal for American industry. The American media should pay more attention to this fact and examine why the United States lost RCA..." When RCA was sold, they didn't care at all. Only after SONY acquired the film company did they make remarks such as "The Soul of America". This is untenable for the United States. What the media is paying attention to represents the concern of the American public. Americans have shifted their focus to the software industry and do not manufacture or sell things. This is also the decisive reason for the continued deficit in the United States. But this discussion is just that. Talking about the fundamental problems of the U.S. economy is superficial and fails to get to the real topic.

American citizens do not have any sense of crisis, but foreigners in the East lament this. What does it symbolize? SONY has been adhering to "technical thinking" since the war, creating a path that symbolizes "Japan's nation based on technology", and at the same time, it also superficially positions its software as "MADE IN JAPAN", which President Morita is proud of. It is also inseparable from the history of SONY.

Starting from the Ruins

Just like the acquisition of Columbia Pictures, SONY has always been at the forefront of high technology of the times. A company cannot create its own path and do things that others do not do. "At this time, SONY has decided to develop into the Tokyo communications industry.

If you open the history book recording SONY, you can find an article mentioning "Tokyo Communications Industry". This name is actually the predecessor of SONY.

In 1945 (the 20th year of the Showa era), when the war was defeated, the founder Ibuka and seven employees of the Tokyo branch of the pre-war operating company jointly invested money. After Tokyo was bombed by B-29, The "Tokyo Communications Research Institute" (later changed to Tokyo Communications Industry) was established in a room in the Shirokiya Department Store in Nihombashi. When it was founded, the entire company's assets were nothing more than money in the well's pockets.

It was an era when being able to eat was great, so they first tried to make food-related products, such as rice cookers, toasters, etc., but they couldn't make everything. success. Finally, the first product appeared: the electric seat cushion. It is a product that wraps electric wires between two pieces of fabric. It sells very well in small stores. It is a very precious cash income for the newly established "Totoken".

The next thing to be manufactured is the "short wave trusted antenna" which is relatively related to the current SONY. This is easy to install on ordinary AM radios. The equipment used to receive shortwave signals sells very well, which will have a positive impact on the future development of SONY.

The "Blue Pencil" column of the Asahi Shimbun on October 6, 1945 introduced the history of Ibuka's struggle. After Morita returned to the countryside, someone happened to ask him if he would be willing to serve as a lecturer at the University of Tokyo. After seeing the Asahi Shimbun column, Morita took the opportunity to take a job in Tokyo and met Ibuka again.

Ibuka's company was very difficult to operate during the Totsuken era. Morita continued to serve as a university lecturer while helping out with the work. The following year (1946), "Tokyo Communications Research Institute" was reorganized into "Tokyo Communications Industry Co., Ltd." with a capital of 190,000 yen and 20 employees. The head office and factory were established in this location. Morita resigned from his job as a lecturer and concentrated on his work in the company. At that time, Ibuka was thirty-eight years old and Morita was only twenty-five years old.

The origin of SONY's leap

Not long after its founding, what supported "Tokyo Communications Industry Co., Ltd." was the manufacture and repair of accessories for radios. However, what lingered in Ibuka's mind The goal was to manufacture products of its own brand.

At that time, Sony's product was radio. Of course, there was widespread discussion in the company about whether it should enter the ranks of manufacturing radios. However, Ibuka was very opposed, mainly because of the post-war period. Radio manufacturers were slowly recovering from the aftermath of the war, so Ibuka was optimistic about the WIRE RECORDER (wire magnetic recorder). However, the manufacturers that produced WIRE were not interested in Ibuka's plan. However, the results were better. Ibuka saw on NHK that the U.S. military in Japan was using the newly released record and player, so he also began to develop the production of the record and player. Based on the development experience of WIRE RECORDER, Ibuka and the others completed the trial work in just a few days.

The more troublesome thing was the tape problem, but it was successfully completed after the test. In 1950, two years after the development, the first domestically produced recorder and player called the G type was finally commercialized. Although the production technology was very good, it did not sell well; a good product does not mean a best-selling product. This was the experience I learned for the first time when I just graduated from college and the salary of the employees was less than 10,000 days. In the Yuan era, the price of 170,000 yen was certainly too high.

The court was the first to purchase G-type recorders, and it ordered twenty units at a time. This was an unprecedented order. Due to the shortage of stenographers in the court at that time, Morita and Ibuka understood the importance of market demand. Later, G-type gradually developed a sales network centered on public agencies and schools. Network. The recorders gradually became smaller and lighter, evolving from H-type to P-type, and then to M-type recorders. At this time, the G-type recorder also obtained the basic patent rights for the AC bias method, and Tongtong began to monopolize the domestic market. , and get a lot of profits from entrepreneurs.

Understanding Semiconductors

A radio is a machine that receives radio waves and modulates and amplifies the signal according to the radio waves so that people can hear the sound. Amplification equipment at that time had to use vacuum tubes; the younger generation may have never seen a vacuum tube, which looks like a light bulb. Therefore, home appliances using vacuum tubes are relatively large. In 1947, a Ph.D. from Bell Research Institute in the United States invented a miraculous electronic component. Although it is about the size of a toothpick tip, it has the same function as a vacuum tube. This is a semiconductor. Ibuka and Morita have noticed this technology that will definitely win the Nobel Prize in the future. So in 1952, Ishen, who was the first to arrive in the United States, knew that the backend of Bell Research Institute (WE) would soon allow other manufacturers to have the patent rights to use semiconductor products. At that time, "Dongtong Engineering" had 120 employees, one-third of whom were excellent technicians. It was the most suitable choice to pool their efforts to complete the work of semiconductor productization. Therefore, Jing Shen made up his mind to obtain the right to use semiconductors.

The following year, 1952, Akio Morita (now the president of SONY) went to the United States to sign a contract with WE. In his book "MADE IN JAPAN", Morita mentioned the state of mind when he first visited New York: "When I visited the United States for the first time, I was shocked by the vastness of the United States. Everything was so big, so far, It’s so vast and so diverse. It’s simply impossible to sell our products in such a country. My only feeling is that we are being overtaken by the United States.” When Morita visited the United States, Dongtong said. The future of semiconductors is completely unclear; even WE only uses semiconductors in hearing aids. But Ibuka and Morita had decided to use semiconductors in radios. RCA's pre-war radios made using small vacuum tubes could only last for four hours, and they also had expensive batteries that took up more than half of the radio's space. If semiconductors are used, the problems of power and battery size can be solved, and the products produced will be epoch-making. Ibuka and Morita had already thought that if they could create a portable radio, they would be able to create a new market. After Morita signed a contract with WE, he traveled to Europe. Morita later mentioned that Europe had just recovered from the war, so he felt very depressed. One day while ordering ice cream at a restaurant in Germany, Morita saw a decoration that looked like a Japanese umbrella. The waiter said with a flattering air, "This is made in your country." It can be seen that people all over the world only know this about Japanese products. It was the Philips factory that gave Morita his dream. The Netherlands is an agricultural country. In the corner of such a city, Dr. Philips fulfilled his ideal and built a world-wide modern enterprise. Morita thought: "We should be able to do it too."

The world's smallest radio

The result of technicians' tireless efforts and a large amount of research and development expenses invested in semiconductors, which also made it possible at that time The main bank, Mitsui Banking Corporation, was shocked. It is a pity that the first company in the world to successfully develop a semiconductor radio was not SONY, but was completed by the American company REGEMCE in 1954. The next year, SONY completed Japan's first semiconductor radio, TR-52. After collecting performance evaluations from all parties, American companies only had 40%, while SONY had 50%. It was obviously a victory for SONY. Moreover, American companies' semiconductors are manufactured externally, while SONY manufactures them in-house, allowing technicians to feel more confident.

The origin of SONY

SONY established its European head office in the UK only later. Morita, who received the Honorary Gold Medal from Wangli Academy of Art, made the following speech at the award ceremony: "SONY has always been creating new things." After listening to this, the attendees felt that this sentence was full of mystery, and maybe some of them also laughed secretly, I think SONY is just a typical example of success using European inventions. After Morita's eyes slowly scanned the audience, he continued: "The so-called new Lexi is the name 'SONY', which is also a new word in English like 'WALKMAN'.

"As soon as this statement came out, even in a solemn and solemn venue full of British gentlemen, it caused a sudden burst of laughter. With such a speech content, members have proposed that an "honorary certificate of advanced English conversation" should be issued to Morita, it can be seen that the British are a nation with a very big sense of humor.

The first product produced by SONY was the TR-52 radio developed using semiconductors for the first time in Japan, but the company name did not change. Unlike the naming mentioned by Morita in his speech in the UK, when TR-52 was exported to the United States, the name TORT-SUKO (ト-ッ-コ in Japanese) was used. It may be that Americans would not like the strict pronunciation. , so we considered changing the name of the brand. This is just like the abbreviations used by TKK and Tokyu Subway, and the abbreviations of NHK and CBS are similar to those of TV stations, which can easily leave an impression on the public's mind. The name of the recorder tape is SONI-TAPE. The English SONICI (sound) is the plural form of the Latin word SONUS. This SONI is combined with the popular phrase "SONNY BOY" (cute little boy) at that time. It was called SONNY, but to make it easier to pronounce, the letters were changed to four words, so the new semiconductor radio "TR-52", which is now famous all over the world, began to shine at that time. Some office workers even ordered shirts with large pockets to hold semiconductor radios, which became popular all over the country. In 1958, the company was officially renamed "SONY Co., Ltd." and the stock was listed on the Tokyo Stock Exchange. p>

Persistence for the brand

For the first time, Morita took the TR--52 with the "SONY" name engraved on it to the United States and traveled to various places for the price of US$29.95. At this time, a "BURORBA company" ordered 100,000 units, but Morita refused. The main reason was that the company had to use their trademark to sell them in the United States. BURORBA is one of the few watch manufacturers in the United States, but Morita is unwilling to become a satellite factory. An employee of the company told Morita, “This company has a history of more than 50 years and is a company with tradition. But Morita replied politely: "Our company will definitely not lose to you in fifty years, and it will definitely become famous." "However, even after fifty years, the results are already obvious. Only people who are interested in watches know BURORBA. Ironically, BURORBA watches from the 1950s are indeed very valuable now, because such watches have already It can be classified as an antique. In contrast, SONY has now become a world-famous brand. “I don’t feel sorry at all for rejecting such an order. On the contrary, I have confidence in my own brand. "At that time, an order of 100,000 was just a dream, but Morita actually refused. Therefore, it is easy to understand Morita's mood when he found out that a chocolate manufacturer used the SONY name to launch products and filed a lawsuit. "Trademarks are the life of a company, even if all difficulties are overcome. We also need to protect, that’s how I usually think about it. Trademarks and company names must be used responsibly to ensure product quality. Therefore, using a trademark established by others with bit by bit effort is also considered a kind of theft. We will never forgive such a thief. ”

The end of infancy

SONY advocates using “technology” as the symbol of its products. In order to protect this trademark, Morita insisted that he must sell it himself, so he had to set up a sales company in the United States. . Therefore, American SONY (SONAM) was born in 1960. At the same time, SONY also reorganized its Geneva office in Switzerland and established the European On-site Sales Company (SOSA) in 1955. After the TR-63 was sold in 1957, SONY semiconductor radios became a worldwide best-seller. Faced with the influx of orders and customers who couldn't wait, SONY did not need to consider costs at all and shipped them directly by air. Sent to all over the United States. In this way, SONY ended its infancy in the eleventh year of its establishment, and also laid the foundation for the flag-bearer of "Japan's Miracle Revival".

New Leader

After entering the 1980s, the BETA format of video tapes also entered the phase of being eliminated, thus casting a shadow on the SONY myth. Then Morita received the bad news of the sudden death of President Kazuo Iwama. The downturn in AV has caused SONY's inventory to pile up. This is the first time since its founding that it has had to rely on cutting costs to balance its income and expenditure.

The person who became president during this period was Norio Ohga. President Dahe was specially promoted at that time and took office in 1982. He was just over fifty. Norio Ohga was born on January 29, 1930, in Numazu City, Shizuoka Prefecture. His family was a wealthy timber trader, and he was an opera singer with a special experience. Although the reasons for BETA's failure cannot be listed in detail, the biggest reason is the failure of software policy. (Referring to the video recorder system dispute that mainly pitted SONY's BETA against Panasonic's VHS. SONY ended in failure.) During the period when video tapes were rapidly increasing, BETA software had almost no growth. Therefore, the Japanese VICTOR company that developed VHS is also involved in the production of movies, video tapes and other works, and has CIC VICTOR, BACK IN MUSIC, etc. under its umbrella. The VICTOR industry has all the capabilities needed to produce movies; with such Only with strength can we develop diverse possibilities.

CBS can provide a small number of software. After President Iwama, who was purely a technician, passed away, President Morita promoted President Oga. The main reason was that Oga was the operator who understood software best and had great expectations for Oga to become president.

The first attempt of the SONY software department to establish CBS SONY was the idea proposed by Dahe. At the same time as foreign investment was liberalized in 1967, CBS Records, the largest record company in the United States, was looking for partners in Japan capable of opening subsidiaries. When CBS proposed this idea to Columbia Japan, it had not yet come to a conclusion. In the end, it chose SONY, which had actual achievements in the audio department and was very interested in software. This was a great thing for SONY. If you have a record department, you can directly enhance the company's audio capabilities in the minds of the world. Therefore, negotiations began in October 1967, and the relevant agreement to merge the companies was soon signed in December. CBS SONY was formally established in 1968, with Dahe as the actual person in charge.

The success of laymen practicing business law

With huge companies as its backers, CBS SONY is closely guarded by the recording industry and officials responsible for supervision. According to Japan's Administrative Guidance Act, SONY is not allowed to increase the company's personnel, such as record relations personnel, artists, etc., through poaching. Dahe recruited talents through an unprecedented open recruitment method, regardless of academic qualifications, age, and gender. A total of 7,000 people signed up, and among the 80 people admitted, there were no so-called "industry personnel." CBS SONY, formed by laymen, ushered in a revolutionary era for the ancient record industry with its rational approach.

Following this, Sony, which gained support from big stars and established an SD department, established a unique recruitment system and many artists were born. Cultivating artists from scratch has created a high-profit system for CBS SONY.

SONY canceled the stylus

NAGAOKA is the first manufacturer that provides 80% of the stylus in the Japanese industry. I believe that those who have a little knowledge of records should be familiar with it. However, the disbandment of NAGAOKA in August 1990 was also the end of EP and LP records. SONY cooperated with Philips of the Netherlands to develop CDs, which was the eighth year after SONY was founded. The CD turntable was launched in October 1882. Five days before this, Dahe flew to Greece with the newly completed CD to hold meetings with record companies around the world. However, the response from the record industry at that time, including CBS Records in the United States, was very lukewarm. For LP record companies that already had a mature market, CDs would not attract much attention. The industry's view is that there will not be a record store on the market that will be willing to sell records and CDs at the same time.

As we all know, CDs have much better sound quality than records, and are small in size and easy to operate. The sound is read from the CD optically without contact, so the service life can be said to be close to semi-permanent.

Although CDs have many advantages, the record industry is not very willing to cooperate in order to protect the existing record market, so it is still not noticeable. In other words, at this stage, software must be relied on to provide the fuse for CD discs, and CBS SONY is the one that exerts its power at this time. CBS, which has grown into a widely popular network, has exerted powerful effects. In terms of hardware, the world's first CD machine "DISKMAND-50" was launched in 1984. After SONY attacked the market with a powerful software strategy, the sales of CDs were like a volcanic eruption. After it started to take off in Japan, the popularity of CDs slowly spread throughout the world. In the end, CDs drove traditional records out of the market. Dahe later said that if it weren't for CBS, CDs might not be popular at all. So SONY once again realized the importance of software. After experiencing the defeat of the BETA system and the victory of CD, SONY finally gradually valued software.

In 1987, CBS SONY acquired its parent company, CBS, for a total of US$2 billion (approximately 270 billion yen at the exchange rate at the time). Although some people criticized the purchase price as being too high at the time, after CBS entered the SONY Group, it achieved a turnover above the purchase price in the second year, and achieved quite high profits. Sony, which had successfully acquired companies, began to pay attention to the currency market in the imaging field, and wanted to come to the United States to investigate American film companies.

SONY development milestones

May 7, 1946: Tokyo Communications Industry Co., Ltd. (Sony’s predecessor) was established.

August 1955: Listed on the Tokyo Stock Exchange.

January 1958: The company was renamed SONY.

February 1960: The US branch was established.

December 1960: Swiss branch established.

June 1961: ADR issuance in the United States.

March 1968: CBS/Sony Music Company was established as a joint venture with CBS of the United States.

September 1970: Listed on the New York Stock Exchange.

August 1979: Sony Prudential Life Insurance Co. Ltd was established as a 50-50 joint venture with Prudential Life Insurance Company of the United States.

November 1986: Sony Euro Europe was established, headquartered in Germany.

January 1988: Acquisition of the US CBS record department, CBS/SONY changed its name to Sony Music.

November 1989: Acquired the American Columbia Tristar Film Company and entered the Hollywood tungsten market.

April 1991: Sony Prudential Life Insurance became 100 Holdings and changed its name to Sony Life Insurance.

November 1995: SCN-Sony Communications Network was established to enter the Internet content service market.

October 1996: China branch was established.

April 2000: Financial report released. The group’s brand value exceeded US$100 billion, reaching its highest peak since its establishment.

October 2001: 50/50 joint venture with Sweden's Ericsson to establish Sony Ericsson Mo-bile Communication/Sony Ericsson Mobile Communications Company.

April 2003: The financial report announced a huge quarterly loss of US$1 billion, triggering Sony Shock, and the stock price plummeted 25% in 2 days.

April 2004: Sony Financial Holdings was established to include banking, insurance, and life insurance, the three major financial businesses.

April 2004: Established S-LCD Corporation as a joint venture with South Korea's Samsung Electronics Co., Ltd. May 2004: Established Sony Connect online music service.

August 2004: Sony Music and BMG Music merged to form Sony BMG.

December 2004: Its subsidiary Sony Pictures acquired MGM Film Company, becoming the world's largest film company.

March 2005: A major change in management rights was announced. In the 59 years since its founding, Howard Sterling, the first foreigner, took over as chairman and chief executive officer, and Ryoharu Nakahata took over as president. On June 22 Officially took over on the day.