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Selfie Craze, PS4 Underpin Sony’s First Signs of Progress

Sony Q314, Edison View: “Selfie craze and PS4 underpin first signs of progress; we expect Sony to continue its strategy of developing its own ecosystem and hope these results will give doubters in the company a little more faith that it can be done.”

Richard Windsor, analyst at Edison Investment Research, said:

“Sony reported much better Q314 results than expected, driven by camera modules, PS4 as well as better results from smartphones. Q314 Revenues / EBIT were JPY2,557.8bn / JPY178.3bn compared to forecasts of JPY2,340bn / JPY96.3bn.

The biggest surprise was the Imaging Products and Solutions group which saw 1.5% revenue growth, but margins jumped to 11.4% from 6.1% just one year ago. Sony has been the main beneficiary of the selfie craze which has seen demand for higher quality front facing cameras increase significantly, as the screen provides a good viewfinder in which to line up the shot especially when using a selfie stick. As the supplier to the iPhone 6 and various Xiaomi products among others, Sony has been a big beneficiary of this trend. The high resolution front facing camera is a high margin product which explains the sudden jump in profitability even as demand for lower margin products was soft.

PS4 also had a great quarter with 6.4m units shipped, which helped drive margins of this business to 5.2% from 2.7% a year ago.

It is also worth mentioning that smartphones managed to gain share to 3.2% from 3.0% in the previous quarter. This is significant because the recent troubles at Sony have caused a renewed focus at the high end at the expense of the low end. This typically results in a loss of market share even if margins go up. In this case, the Xperia Z3 has been pretty well received but margins have remained challenged at 2.2%. To shore up profitability and to reflect its more modest ambitions, Sony is cutting another 1,000 positions at its handset business which should bring an annual OPEX saving of around JPY12bn.

Sony’s fortunes are expected to continue improving in early 2015, as it now expects the group to post an operating profit of JPY20bn for the year to March 15 compared to previous forecasts of a LOSS of JPY40bn.

Sony is embarking on an ecosystem strategy to bring all of the pieces of this sprawling empire together. The lynch pin of this strategy is the smartphone .It is here that the user spends most of his Digital Life. Consequently, we believe that the decision regarding which ecosystem to live with will be taken on this basis  – which is why the smartphone business is so important.

These results have given Sony a little breathing space, but the selfie craze and the PS4 replacement cycle are not going to last forever. That being said, we believe that Sony understands what it needs to achieve which is half the battle when viewed in the context of its competitors and the world of consumer electronics.

Consequently, we expect Sony to continue with its strategy of developing its own ecosystem and hope that these results will give doubters in the company a little more faith that it can be done. Sony remains the only Japanese company in our view that  has real potential and a future in consumer electronics….. although it will most likely be a long hard road.”

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Novel Method Projects Growth Potential of New Firms

New businesses spring up all the time in the U.S. But which ones have the greatest ability to become big? A method developed by MIT researchers, based on an empirical study, projects the growth potential of high-tech firms with new precision — and could help local or regional policymakers assess their growth prospects.

“A central question in evaluating the impact of policies toward business creation, startups, and innovation, is simply how to measure the kinds of entrepreneurs who are likely to build growth businesses,” says Scott Stern, the David Sarnoff Professor of Management at the MIT Sloan School of Management, who led the study. For all the theorizing about the subject, he adds, “There has historically been a big gap, in terms of how to measure and do analytics in a systematic way.”

But now, based on a uniquely comprehensive analysis of businesses in California, Stern and his colleague Jorge Guzman, a doctoral candidate at MIT Sloan, have created a richly detailed picture of what characteristics high-growth tech firms have, and where they exist. The study is summarized in a new paper — titled “Where is Silicon Valley?” — being published today inScience.

Among other factors, firms that formally register, seek capital investment, and make news early in their lives have higher growth potential. That much might seem intuitive — but even a firm’s name, Stern and Guzman found, offers a solid hint of its growth potential. For instance, a business whose name includes the name of a founder does not generally expand as much as other types of firms.

“That combination [of factors] turns out to be a very useful diagnostic for separating out the types of businesses that have a reasonable chance of growing, versus those that are much less likely to grow,” Stern says.

By assessing what it calls the “quality” of startups, and not just their quantity, the study also highlights which towns are home to startups with higher growth potential. In California, the municipalities of Menlo Park, Mountain View, Palo Alto, and Sunnyvale top this list, in that order, with startups having characteristics that are associated with offering an IPO or being subject of a large acquisition, at about 10 times the state average.

From Silicon Valley to Massachusetts

Stern and Guzman are in the process of studying Massachusetts in similarly granular fashion; they are releasing a working paper, as well as initial data visualizations of Massachusetts, to complement the work on California.

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CPES2015 Unveils Keynote Speaker Lineup

The Canadian Printable Electronics Industry Association (, the united voice of Canada’s Printable Electronics sector, has lined up an impressive roster of international keynotes for the 2015 Canadian Printable Electronics Symposium (CPES2015).

CPES2015 will showcase the convergence of research and development, industry expertise, commercial effort and government support that gives Canada a tremendous opportunity in the explosive global market for printable and organic electronics (POE).

“Printable and Organic Electronics truly is a technology for our future that is already here,” said Peter Kallai, Executive Director of the CPEIA. “Our fantastic keynote speakers will show that breakthroughs in materials and manufacturing are creating real products and real applications that have commercial potential today as well as for tomorrow.”

The purpose of CPES2015 is to inform CPEIA Members and Canadian industry players that can take advantage of organic and printable electronics about global trends and opportunities and what is done in Canada.

The five keynotes are:

Dr. Stephen Hoover, CEO, PARC, a Xerox Company

Practicing open innovation since 2002, PARC develops innovations and new technologies and takes those to market in collaboration with Fortune 500/Global 1000 companies, startups, and governments.

Dr. Hoover leads PARC’s business and research in diverse areas including networking, electronics, cleantech, innovation services and intelligent systems. He will discuss the Business of Breakthroughs.

Jennifer Ernst, Chief Strategy Officer Thin Film Electronics ASA. Norway

Thin Film is a leader in the development and commercialization of printed electronics and related smart systems, including memory, sensors, displays, and wireless communication. It was the first to commercialize printed, rewritable memory and is heavily invested in the Internet of Things, to bring intelligence to everyday objects.

Ms. Ernst leads strategic roadmap and partnership development activities at Thin Film. She will discuss the Internet of Things.

Bernard Kippelen, Joseph M. Pettit Professor, School of Electrical and Computer Engineering (ECE), Georgia Institute of Technology, United States.

ECE’s Center for Organic Photonics and Electronics advances the science and engineering of organic and hybrid nanostructured materials and technological innovations for applications in communications, sensing, displays, energy-efficient solid-state lighting and power generation.

Professor Kippelen is a distinguished and leading global researcher in printable and organic electronics. He will discuss recent progress in a range of solid-state devices, including organic light-emitting diodes (OLEDs), organic field-effect transistors (OFETs), sensors, organic solar cells, and photodetectors, and show how these advances can lead to disruptive innovations to address some of the world’s greatest challenges.

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