More bad news for Sony
p2pnet.net News:- Sony Corp shares have fallen as much as 3% after Apple said it, too, would recall dangerous Sony PC batteries – 1.8 million of them – in the second major recall involving Sony power cells in less than two weeks.
“Sony’s brand image has been tainted,” Reuters has Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management saying. “No doubt about it.”
In fact, Sony’s image has been smelly ever since the Sony Music DRM disaster when it was found the company had been secretly planting spyware on users’ PCs and that worse, the spyware actually threatened the health of the systems.
And Apple’s recall announcement follows another by Dell which involved 4.1 million Sony batteries labelled as potential fire hazards.
“Sony’s shares closed down 2 percent at 5,000 yen after tumbling 3.1 percent to 4,940 yen, below the 5,000 level for the first time since late July,” says Reuters, adding, “The Tokyo-based company said the two recalls would cost it 20-30 billion yen ($172-258 million. The higher figure equals about a quarter of Sony’s net profit forecast for the business year to next March.”
Aside from the short-term financial impact, “investors are keeping a close eye on the long-term and indirect impact of the recalls on the electronics and entertainment conglomerate,” says another Reuters story.
“It is important to know if Sony’s output system, shipment system or management system has something to do with the recalled products,” it has Akino stating.
“If so, there could be a chance that other Sony products are also affected. This may go deeper than what it is now.”
Japan’s Ministry of Trade to has told Dell and Sony to investigate fires in notebooks. Reuters doesn’t say if Apple will now be included in the order.
Also See:
Reuters – Sony stock hits 1-mth low on 2nd battery recall, August 24, 2006
MSN Money – Sony shares fall on battery recall, August 25, 2006
investigate fires – Sony, Dell, battery fires, August 25, 2006
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