Analysts: Sony attack shows lack of hardware innovation

Sony's recent attacks from hacker groups, the most recent of which saw Sony BMG falling victim, have been estimated to cost the company within the region of $1 billion. But while users see the figure as a mark of the sizeable damage the hacks caused, industry analysts are approaching the bill from a different angle.

Speaking to The Independent, Toshiyuki Kanayama expressed concern that Sony are losing sight of how to innovate in the hardware area. "What is important is that they make attractive products. Unless they do that, why should consumers choose to buy Sony products?" he said. "Sony says it wants to bring its software to its hardware. Look at Apple. Software followed its attractive products."

Nikkei, the Japanese media empire, also said that Sony are sorely lacking in hardware, claiming that Sony has "nothing" to pick itself up with. The outlet went on to speculate that Sony's yearly profit will come from severe cuts rather than actual growth.

Historically, Sony has been a hardware company, and its largest milestones have been physical products. While a shift towards software echoes the sentiments of the rest of today's industry, companies such as Apple have shown the connection between hardware and software is just as important to consumers.

However, not everyone is negative about the long term. In a note to clients, Goldman Sachs said: "We think it is a matter of time until concern over the attacks and the earthquake impact fades." Shiro Mikoshiba from Nomura securities was also skeptical about any long lasting effects. "The impact on Sony's earnings should be contained in the April-June quarter," he said.

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