Sony Ericsson posts €23m loss

MOBILE PHONE maker Sony Ericsson yesterday posted a third-quarter loss of €23 million for its global operations and is set to come under increasing pressure in the Irish market from Samsung.

Sony Ericcson and Samsung are Nokia’s main competitors in the Irish mobile phone market. Samsung claims to be on course to sell 400,000 handsets this year, which would put it ahead of its rival behind the Finnish giant.

Sony Ericsson, which is the world’s fifth-largest handset maker, incurred a €35 million restructuring charge during the quarter, but analysts had been predicting much larger losses.

“The outlook for Sony Ericsson seems rather uncertain,” Greger Johansson, an analyst with Redeye, said.

“Their new products are not as exceptional as they were a couple of years ago, compared to their competitors.”

Sony Ericsson president Dick Komiyama was cautious about the impact of a deteriorating economy.

“How this financial situation impacts consumer behaviour we are not sure yet,” Mr Komiyama said.

But asked whether the company might need to do more cost-cutting if conditions stayed weak, he said he thought cost plans looked “good enough” right now.

Samsung began a major assault on the Irish market last year. Samsung Mobile country manager Gary Twohig said the Korean firm had invested €1.5 million in advertising and marketing this year, and will have a market share of just over 20 per cent by year end, putting it second ahead of Sony Ericsson.

“We will grow 100 per cent year on year as we did 200,000 handsets in 2007,” Mr Twohig said. “We are particularly proud to have achieved that with our focus on mid- and high-end phones.”

Samsung also introduced the Tocco, which has a built-in Irish- language dictionary for texting, this year and now plans a “sub-brand” for Irish-language phones called Gael Fón.

Next month will see the introduction of the touchscreen Omnia Windows-based smartphone on the Irish market, but Mr Twohig said the focus would be on “value for money” as consumers tighten their belts.

It will promote a “his and hers” offer, in Carphone Warehouse stores in the run-up to Christmas, which features handsets for €99. – (Additional reporting Reuters)