Upload & Sell: On
Bailing out failed companies is a recipe for disaster. Failed companies must be allowed to fail. They failed for a reason and if those actions do not have consequences, then they are reinforced. If anything Japan should manage the break up of Sony.
That's not the way it is in Japan (or the rest of Asia for that matter). The governments spent huge money making big businesses (see the wiki article on Keiretsu for Japan, Chaebol for Korea. Mainland China has its own version of this, and so do Hong Kong and Taiwan, though in the latter cases small and medium enterprises are stronger). Big businesses are national icons, employ lots of people (directly and indirectly), are tied into the banking system and do not just have politicians in their pockets - the politicians and business elites are part of the same governing system. Ending the system would be revolutionary.
Many Asians (my mom being one) are brainwashed into heavily preferring what they perceive as "their own" nation's products, since that will make the country strong and keep people unemployed. They are not generally open to the idea of to the detriment of innovation.
So, talk aside, Japan will "bail out" Sony and the other electronics makers if necessary. I see consolidation as the only likely alternative scenario to "limping along".
Spyro P. wrote:
It looks like their best selling segment is mobiles/comms, followed by home entertainment, devices, financial services (??), imaging, pictures, gaming and music. Imaging is profitable, financial services is the most profitable, most others are loss making
Maybe they're better off becoming a bank
That's the whole point of the Asian big business system. All the things together reduce risk and expand the company's clout.
And I mention all the above not to argue that the Asian system is better - I would not support such a system in the USA. Working in such a system would drive me nuts (all the weaknesses of the US private and public sector with none of the benefits), and such a system stifles innovation and entrepreneurship. It also causes many people to resent the big companes/government (I'm told, for instance, that many Koreans hate Samsung for this exact reason). Japan, for one, has some very competitive companies outside of the government-corporate system and a tremendous amount of creativity and even entrepreneurial talent. But much of society's money and talent is allocated elsewhere.
Finally, Thom Hogan put out and excellent article talking about these same things. He claims to have a very strong evidence base, and while I can't evaluate that I can say the evidence he uses in the article and his argumentation is excellent.
Bottom line: things will limp along for at least a few generations, though Panasonic will have a particularly tough next year or two (and its imaging business *might* disappear in the near future). What the future holds in store is anyone's guess. I'll agree with that.