Sony IR Day 2014
Imaging Products & Solutions Segment
November 25, 2014
Shoji Nemoto
EVP, Corporate Executive Officer
President of Imaging Products and Solutions Sector,
President of Professional Solutions Group
Shigeki Ishizuka
SVP, Corporate Executive
President of Digital Imaging Business Group
Sony Corporation
Agenda
Imaging Products & Solutions Segment
Overview of Imaging Products & Solutions Segment
Digital Imaging Products
1. Business Overview
2. Forecasted Market Trends
3. Mid-term Business Direction
Professional Solutions
4.
Business Overview
5.
Mid-term Business Direction
Imaging Products & Solutions Segment
6.
Business Performance
7.
Summary
Sony IR Day 2014
37
Overview of Imaging Products & Solutions Segment
Imaging Products & Solutions Segment
Consumers
Compact Digital Still Camera
Digital Interchangeable Lens Camera
(Mirrorless/DSLR)
Lens portfolio
Camcorder
for Prosumers
Content Creation
Sensing
Modules
HandyCam
ActionCam
New Camera
B2B
Visual
Medical
Presentation
Security, Felica, etc.
Customer
Segments
Mission : With continuous innovation in the Digital Imaging category, we aim to firmly
maintain Sonys leading position in the industry and contribute to the Sony Group
by generating stable profit
System Solution
Imaging Platform
Professional Solutions Business
Digital Imaging Products Business
Sony IR Day 2014
Imaging Products & Solutions Segment
Digital Imaging Products
1-1. Business Overview
FY2013 Sales by Products
Others
FY2013 Sales by Region
Others
Video
Camera
Sales
442.7
bln yen
38
Japan
US
Asia,
Middle
East &
Africa
Sales
442.7
bln yen
Europe
Still
Camera
China
Category breakdown*1
*1. abbreviated name in parentheses () will be used in this presentation
Video Camera: Consumer Video Camera (Consumer CAM *2) *3, Professional Video Camera (Professional CAM)
Still Camera: Compact Digital Still Camera (DSC), Interchangeable Lens Camera (ILC), Interchangeable Lens
*2. CAM=Video Camera
*3. Including Action Camera
Sony IR Day 2014
39
Imaging Products & Solutions Segment
Digital Imaging Products
1-2. Key Products Market Share (Value basis)
FY2013 Video Camera Market
FY2013 Still Camera Market
Market Size: 2,300 bln yen
Market Size: 320 bln yen
No.3
Share
No.1
Share
Market Share by Product Category
Market Share by Product Category
DSC:
Consumer CAM:
19(No.3)
(Premium DSC*1 share: over 30%(No.1))
ILC (Inc. Lens):
37% (No.1)
(Conventional video camera share: 50% (No.1))
9(No.3)
Professional CAM:
48% (No.1)
(Mirror-less camera share: 40% (No.1))
*1. Premium DSC= DSC with large (1/1.7inch over) imager or high zoom (x20 over)
Sony IR Day 2014
Source: Sony
40
Imaging Products & Solutions Segment
Digital Imaging Products
2. Forecasted Market Trends by Product
The video camera market is expected to shrink slightly, while the still camera market is
expected to shrink significantly. In still cameras, the percentage of mirror-less ILCs will increase
Expect increase in ratio of ILC, especially mirror-less
(Unit Basis)
(Thousand units
70,000
60,000
Still Camera
Market
Composition
Forecast
FY14
FY17
50,000
ILC: Mirror-less
DSC
40,000
ILC: Single reflex
No significant change in market composition
Professional cameras accounts for 30% on value basis
30,000
20,000
Video Camera
Market
Composition
Forecast
10,000
0
FY14
FY15
VideoCameraMarket
Source: Sony
FY16
FY14
FY17
FY17
StillCameraMarket
Consumer CAM
Professional CAM
Sony IR Day 2014
41
3-1. FY2014 Business Outlook and Mid-term Business Direction
Change in FY2014 Operating Income
Reasons for Improvement from FY2013FY2014
Improvement in product mix due to the
shift to premium products (ILC, DSC
Growth of interchangeable lens business
Improvement in operational efficiency
- Reduction in sales company SGA
- Reduction in fixed costs associated with manufacturing
- Improvement in development efficiencies by propelling
Design Platform
Imaging Products & Solutions Segment
Digital Imaging Products
Negative
Factor
500
Positive
Factor
Operational
Improvement
450
Others
400
350
Growth of
Lens Biz.
300
250
200
Decline in
Shipments
due to
Market
Shrinkage
150
100
50
Premium
Shift
FY14
FY14
FY13
FY13
(Forecast as of
October 2014)
Mid-term Business Direction
Aim to sustain highly profitable business by continuously focusing on
premium and growing markets while pursuing operational efficiencies
Sony IR Day 2014
42
Imaging Products & Solutions Segment
Digital Imaging Products
3-2. Mid-term Business Direction
Aim to sustain highly profitable business by continuously focusing on
premium and growing markets while pursuing operational efficiencies
Strategy I
Enforcement of Interchangeable Lens
Camera (ILC) Business
Consumer Camera Market *1
(Value basis)
100%
90%
Strategy II
Expansion of Interchangeable
Lens Business
Strategy III
DSC/CAM Further Premium Shift
Strategy IV
Application of Camera Technology to
B2B Market
Strategy V
Continuous Improvement in
Operational Efficiency
Growing Segment
80%
70%
ILC: Single reflex *2
60%
ILC: Mirror-less *2
50%
DSC (Premium *3)
40%
Mature Segment
30%
20%
DSC (Entry)
10%
0%
Consumer Video Camera *4
FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017
FY08
*1
*2
*3
*4
FY14
FCT
FY17
FCT
Source: Sony
Including Interchangeable Lens
Premium DSC= DSC with large (1/1.7inch over) imager or high zoom (x20 over)
Including Action Camera
Sony IR Day 2014
43
3-3. Strategy I. Enforcement of ILC Business: Activity of FY2013 / 2014
Imaging Products & Solutions Segment
Digital Imaging Products
FY2013
FY2014
Create New Full Frame Mirror-less Camera Market
The Worlds Best Technology in a Compact Body
Worlds First,
35mm Full Frame
Optical Low-pass Filter-less
Ultra High Resolution (35M pixels)
Worlds First Full Frame ILC
with 5-axis image stabilization
Worlds Highest Sensitivity
ISO409600
High-end
User
New
Released Nov. 2013
Released Nov. 2013
To be released Dec. 2014
Released Jun. 2014
Worlds Fastest Autofocus*1
Middle
Entry
User
*1 6000 as of Feb. 2014
Entry and Middle class
Mirror-less camera line-up
with top market share
Wide-area
Released May 2014
Depth
Worlds fastest* AF speed of
0.06 sec
3-4. Strategy I. Enforcement of ILC Business: Our Next Vision
FY2013
Create New
Full Frame Mirrorless Camera Market
FY2014
The Worlds Best
Technology in a
Compact Body
Imaging Products & Solutions Segment
Digital Imaging Products
FY2015
Establish clear differentiation from others
by utilizing 3 key in-house core technologies
Ultimate
Sensitivity
Ultimate
Resolution
High-end
User
New
* 6000 as of Feb. 2014. Based on Sony research
Time
AF algorithm for steadfast and
Sony IRof
Day
2014
accurate prediction
next
move
Released Sep. 2014
Middle
Entry
User
179-point
focal plane phase-detection AF sensor
Ultimate
Speed
Image
Cube
Image Stabilization
Sony IR Day 2014
45
Imaging Products & Solutions Segment
Digital Imaging Products
3-5. Strategy II. Expansion of Interchangeable Lens Business
Accelerate lens business by expanding rich lens line-up, especially on full frame E-mount (FE) lens,
and marketing them with G brand and Zeiss brand backed by cutting edge in-house lens technology
Technology
In-house lens
technologies
Aspherical Lens
Nano AR Coating
Elements
Expansion of FE line-up
ED (Extra-low Dispersion)
Glass
Circular Aperture Linear Motor
Super Sonic-wave Motor (SSM)
Rich lens line-up offering versatile shooting options
Total Lens Line-up*3
Product
FY2013
5 FE lenses
FY2014*1
13 FE lenses
FY2015~
Over 20
FE lenses
Cumulative production*2
over 30 mil. units
Brand lenses with Sonys cutting edge digital technology
Customer
Branding Strategy
Established brand of optics from analog era
Branding mainly for
-Standard to Telephoto
-Zoom
type Lenses
*1. Including lenses under development and to be released within fiscal year 2014 (~March, 2015).
*2. Total number of Interchangeable lens produced for Sony ILC, including lens produced by Konika Minolta in the past.
FY2013 : 56 Lenses
FY2014*1 : 64 Lenses
FY2015~(Short term goal)
: Over 70 Lenses
Branding mainly for
- Wide ~ Standard
- Prime
type Lenses
*3. Total number of Interchangeable lenses
in IR
Sony
line-up.
Sony
DayILC
2014
Imaging Products & Solutions Segment
Digital Imaging Products
3-6. Strategy III. DSC/CAM Further Premium Shift
Keep competitiveness of premium products by evolving and combining in-house
core technologies which realize new photography experiences and customer value
RX100 (FY2012)
X100
Pocket-sized, pro performance
Your Story. In 4K detail
Worlds first 4K Consumer CAM
with 1.0-type Sensor
Premium DSC with 1.0-type Sensor
RX100M2 (FY2013)
Ultra-sensitive artistry
New 1.0-type back-illuminated Sensor
RX100M3 (FY2014)
Wide angle / High resolution
New large aperture lens
New EVF
New image processing engine
Image
Cube
PXW-FS7
Expansion mount family
to professional CAM
Professional CAM with E-mount
Interchangeable lens system
Sony IR Day 2014
47
3-7. Strategy IV. Application of Camera Technology to B2B Market
Imaging Products & Solutions Segment
Digital Imaging Products
Planning to expand B2B camera business by applying our strong
core camera technologies cultivated in the competitive consumer camera market
Automotive
Camera
Machine Vision
Camera
Camera Block for
Surveillance Camera
Sony IR Day 2014
3-8. Strategy V. Continuous Improvement in Operational Efficiency
R&D
48
Imaging Products & Solutions Segment
Digital Imaging Products
Propel camera design platform to realize engineering efficiencies
and reinforce our core technologies
Be Particular and Decide Practically
Production Lean management of fixed cost to meet tough business conditions
Sales
Streamline sales function in accordance with corporate strategy
Sony IR Day 2014
49
Imaging Products & Solutions Segment
Digital Imaging Products
3-9. Summary
Aim to sustain highly profitable business by continuously focusing on
premium and growing markets while pursuing operational efficiencies
Key Strategies
I.
Enforcement of Interchangeable
Lens Camera (ILC) Business
II. Expansion of Interchangeable
Lens Business
Sales
5000
Operating Income Margin
Expansion Premium shift
Decline in
Enforcement
of
Shipments
DSC/CAM
of
Lens Biz.
due to
Camera Biz.
Market
Shrinkage
4000
3500
3000
110%
Others
90%
70%
50%
2500
III. DSC/CAM Further Premium Shift
IV. Application of Camera Technologies
to B2B Market
30%
2000
Sustainable high
profit business
1500
1000
10%
-10%
-30%
500
V. Continuous Improvement in
Operational Efficiency
150%
130%
4500
-50%
FY14
FY14
(Forecast as of
October 2014)
FY17
FY17
(Target)
Sony IR Day 2014
50
Imaging Products & Solutions Segment
Professional Solutions
4-1. Business Overview
Three Core Business Areas
Solutions business aimed toward broadcasters and other content creators mission-critical tasks (Content Creation)
Projection systems for sophisticated and diversified content (Projector)
Medical products and systems using Sonys imaging and device technologies for capturing, printing, sharing and
presenting images (Medical)
FY2013 Sales by Key Business Areas
Other
Content
Creation
Broadcasters
Film Studios
Medical
Operating
Rooms
Endoscopes
Ultrasound
Radiation
Examination Rooms
Projector
Sports Stadiums
Auditoriums
Classrooms/
Meeting
Rooms
Digital
Cinemas
Home Theaters
Sony IR Day 2014
52
Imaging Products & Solutions Segment
Professional Solutions
4-2. Business Overview - Content Creation
Content Creation business strengths:
Overwhelming trust from customers derived from Sonys long-term contribution to their mission-critical
tasks
Global No. 1 market share in camera system
FY2013 Sales by Key Products / Systems
FY2013 Sales by Region
Global No.1 in Broadcast
Cameras and Camcorders
Archive System
Other
Products/
Systems
Camera
System
Other
Areas
China
Switchers
Japan
United
States
Europe
4K/HD Live Server
Sony IR Day 2014
53
Imaging Products & Solutions Segment
Professional Solutions
4-3. Business Overview - Projector
Projector business strengths:
In-house production of key devices provides us with technological differentiation and high quality
Successful laser light source model that is more advanced than our competitors has allowed us to
increase our share in the middle-brightness market
Expansion of market share in high-end home projector with 4K SXRD panel
FY2013 Sales by Key Products / Systems
Strength of vertical integration
Phosphor laser light source and 3LCD panel can
realize vivid color images
Digital
Cinema
Business
Projector
3LCD Laser Light Source Projector
Home
Projector
BrightEra is the name of our own LCD
micro-display device which realizes high
picture quality
Sony IR Day 2014
54
Imaging Products & Solutions Segment
Professional Solutions
4-4. Business Overview - Medical
Medical business strengths:
Global No. 1 market share in medical printers for endoscope and ultrasound systems
Expansion of medical products other than printers
Example: head-mount image processing unit for endoscopic image display
FY2013 Sales by Key Products / Systems
Monitor,
Camera,
Recorder
Global No. 1 in Medical
Printers for endoscope and
ultrasound systems
Head-mount image processing unit enables
more flexible work styles
Conventional
laparoscopic procedure
Laparoscopic procedure using
Sonys head-mounted display
Surgeons posture and
movement are restricted
Enables surgeons to
position themselves flexibly
Printer &
Media
*Please note that although this product has been approved in Japan and EU,
its launch in other countries has not yet been confirmed.
Sony IR Day 2014
55
Imaging Products & Solutions Segment
Professional Solutions
5-1. Mid-term Business Direction
Utilizing the strengths of the three core businesses, we will reinforce the
competitiveness and profitability of each business, and contribute to
stable and sustainable profit for Sonys electronics business
Forecasted Market Trends by Business Area (CAGR*1 for FY2014-2017)
Content Creation
Addressable Market
CAGR 2-3%
Projector
Installation Projectors
CAGR 11-13%
Medical
Addressable Market
CAGR 5-7%
Source: Sony
*1. CAGR: Compound Annual Growth Rate
Sony IR Day 2014
5-2. Mid-term Business Direction - Content Creation
56
Imaging Products & Solutions Segment
Professional Solutions
Maintain competitiveness by offering innovative value in total workflow from acquisition to
distribution utilizing the strengths of our camera systems, and respond to customers demand for
higher resolution and further efficiency
The remote production environment
can be easily simplified compared to
a conventional system using
multiple coaxial cables
4K for HD solution
IP Live Production
HD Super Zoom
Archive System
Media Lifecycle Service
Create new efficiencies and
new business based on
customers media assets
and archives
Sony IR Day 2014
57
Imaging Products & Solutions Segment
Professional Solutions
5-3. Mid-term Business Direction - Projector
Continue to invest in one and only differentiated technologies
Propose Sonys unique visual entertainment experience to the customers
Elemental technologies necessary to realize immersive Kando experience
SXRD
3LCD
Laser Light Source
Sony IR Day 2014
5-4. Mid-term Business Plan - Medical
58
Imaging Products & Solutions Segment
Professional Solutions
Offer innovative products and systems for images in medical workflow by optimizing
Sonys imaging and device technologies and resources
Expansion of products for key accounts
*product photos are current model.
Distribution of surgery video in hospitals
Sony IR Day 2014
59
6-1. IP&S Segment: Change in FY2014 Operating Income
Imaging Products & Solutions Segment
(bln yen)
1 Decrease in sales as a result of the
shrinking consumer digital imaging market
Sales
756.2
710.0
741.2
2 Improvement in product mix due to a shift to
higher-margin products
52.0
3 Reduction of sales, engineering, and
production costs
4 Positive impact of foreign exchange rates
Operating
Income
1.4
26.3
Var.
Var.
FY12
FY13
FY14
Var.
Var.
(Forecast as of
October 2014)
Operating income is forecasted to increase as a result of 1. an improvement in the
product mix which covered the decline in sales due to the shrinking consumer
digital imaging market, and 2. fixed cost reductions
Sony IR Day 2014
6-2. IP&S Segment: Initiatives to Improve Profitability (FY2014 to FY2017)
60
Imaging Products & Solutions Segment
(bln yen)
(-) Market contraction in commoditized existing
businesses
(+) Expanding new consumer businesses
i.e. Interchangeable lens cameras
(+) Growing Medical & Projector businesses
Expand customer value in the Contents
Creation business through 4K and IP
(+) Reduction in fixed costs through operational
efficiency
Sales
756.2
741.2
650700
710.0
52.0
Operating
Income
7.3%
7%9%
26.3
Operating
Income
Margin
(%)
3.5%
1.4
0.2%
FY12
X.X
FY13
FY14
(Forecast as of
October 2014)
FY17
(Target)
Although the market size of our existing commoditized businesses is shrinking,
we plan to increase operating income through the expansion of new consumer and
professional businesses, in addition to controlled fixed costs
Sony IR Day 2014
61
7. Summary
Imaging Products & Solutions Segment
FY2017 Financial Targets
Sales
Operating Income Margin
650700 billion yen
7% 9%
IP&S will aim to generate stable profit by
promoting technology-driven product development and
establishing new customer segments
Sony IR Day 2014
62
Cautionary Statement
Statements made in this presentation with respect to Sonys current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking
statements about the future performance of Sony. Forward-looking statements include, but are not limited to, those statements using words such as believe, expect, plans,
strategy, prospects, forecast, estimate, project, anticipate, aim, intend, seek, may, might, could or should, and words of similar meaning in connection with a
discussion of future operations, financial performance, events or conditions. From time to time, oral or written forward-looking statements may also be included in other materials
released to the public. These statements are based on managements assumptions, judgments and beliefs in light of the information currently available to it. Sony cautions
investors that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, and therefore
investors should not place undue reliance on them. Investors also should not rely on any obligation of Sony to update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise. Sony disclaims any such obligation. Risks and uncertainties that might affect Sony include, but are not limited to:
( i ) the global economic environment in which Sony operates and the economic conditions in Sonys markets, particularly levels of consumer spending;
( i i ) foreign exchange rates, particularly between the yen and the U.S. dollar, the euro and other currencies in which Sony makes significant sales and incurs production costs, or
in which Sonys assets and liabilities are denominated;
(iii) Sonys ability to continue to design and develop and win acceptance of, as well as achieve sufficient cost reductions for, its products and services, including televisions, game
platforms and smartphones, which are offered in highly competitive markets characterized by severe price competition and continual new product and service introductions,
rapid development in technology and subjective and changing consumer preferences;
(i v) Sonys ability and timing to recoup large-scale investments required for technology development and production capacity;
( v ) Sonys ability to implement successful business restructuring and transformation efforts under changing market conditions;
(vi ) Sonys ability to implement successful hardware, software, and content integration strategies for all segments excluding the Financial Services segment, and to develop and
implement successful sales and distribution strategies in light of the Internet and other technological developments;
(vii) Sonys continued ability to devote sufficient resources to research and development and, with respect to capital expenditures, to prioritize investments correctly (particularly in
the electronics businesses);
(viii) Sonys ability to maintain product quality;
(ix) the effectiveness of Sonys strategies and their execution, including but not limited to the success of Sonys acquisitions, joint ventures and other strategic investments;
( x ) significant volatility and disruption in the global financial markets or a ratings downgrade;
(x i ) Sonys ability to forecast demands, manage timely procurement and control inventories;
(xii) the outcome of pending and/or future legal and/or regulatory proceedings;
(xiii) shifts in customer demand for financial services such as life insurance and Sonys ability to conduct successful asset liability management in the Financial Services segment;
(xiv) the impact of unfavorable conditions or developments (including market fluctuations or volatility) in the Japanese equity markets on the revenue and operating income of the
Financial Services segment; and
(xv) risks related to catastrophic disasters or similar events.
Risks and uncertainties also include the impact of any future events with material adverse impact.
Sony Corporation Investor Relations
105