Sony(NYSE: SNE) recently unveiled two new mid-range smartphones, the Xperia C5 Ultra and Xperia M5, which both rely on their higher-end cameras to stand out in the crowded Android market. Sony has not announced any official prices yet, but the pair of phones should launch in emerging markets later this month.
The C5 Ultra features two 13-megapixel cameras on the front and back of the device. The M5 has a 13-megapixel front-facing camera and a 21.5-megapixel rear. Besides those beefy cameras, the two handsets have fairly standard mid-range specs. The C5 has a 6-inch 1080p display, a 64-bit 1.7Ghz processor, and 2GB of RAM. The M5 has a 5-inch 1080p display, 64-bit 2.0 Ghz processor, and 3GB of RAM. Both devices run on Android 5.0, have 4G connectivity, and reportedly can last two days on a single charge.
Sony's mobile dilemmaSony only controlled about 2% of the global smartphone market last year, according to Gartner. Its inability to dent that market caused the mobile unit to take a whopping operating loss of $1.8 billion last year.
The company, like many Android handset makers, is getting crushed between iPhones in the high-end market and cheaper Chinese rivals like Xiaomi and Huawei on the low-end. Despite those challenges, Sony Mobile CEO and President Hiroki Totoki recently told Arabian Business that the company "will never ever sell or exit" the smartphone business.
Instead, Totoki is focusing on making the unit profitable, even though it might mean selling fewer smartphones and refusing to cut prices. Last November, he warned investors that the initiative could cause annual mobile revenue to decline "by 20% to 30%."
Nothing new for the industryLaunching mid-range smartphones with high-end cameras is not a novel approach. Nokia tried it before with Lumia Windows Phones, and Sony previously introduced bolt-on DSLR lenses for its smartphones. Neither idea really caught on.
Looking ahead, Sony investors should see how much more costly the company's dedication to mobile gets. Higher losses could keep wiping out Sony's bottom-line growth across other businesses, and the company might need to consider selling or spinning off the business entirely.
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Leo Sun has no position in any stocks mentioned.
Source: Sony Launches 2 New Mid-Range Smartphones
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