Sony Corporation of America

FUJIO NISHIDA (President, Sony Europe): Good afternoon Ladies and Gentlemen and welcome to the Sony Europe Press Conference here at IFA.

Thank you for joining us in the centre of what is once again the biggest booth for any single company at IFA this year. Despite the economic uncertainty and the challenges that all of us in the industry face, IFA continues to provide us with an excellent opportunity to present our products to a pan-European audience in time for the peak buying season, which this year will be even more crucial to our industry than in previous years. So we are delighted to be back at IFA once again.

I will be returning later to highlight some of these great products that we will be launching this year in Europe, but to place these products and my later comments in context, and to provide you with more information about Sony’s overall strategy and direction, it gives me great pleasure to introduce our Chairman, CEO and President, Sir Howard Stringer.

HOWARD: Thank you very much, Fujio. I am very happy to be here with all of you again this year.

When we met a year ago, none of us realized how broad and deep the global economic crisis would become, and how it would irrevocably change our businesses and our world. I dare say, back then -- with bright new electronics devices on display and the promise of convergence and connectivity driving us forward -- we could not anticipate the turmoil that would force us to re-evaluate all that we do. One year later, it does seem that the worst is behind us, and that the lessons learned have brought productive and necessary change to our entire industry.

At Sony, we know that we need to work even harder to engage with our customers and with consumers. We know that there is nothing any company can take for granted in this new world. We know that beautiful products, in and of themselves, cannot move markets. They must be networked. They must have real economic value. They must capture the imagination, and Sony must find new ways to differentiate products that serve the needs and desires of newly networked customers.

Sony has moved rapidly to change and adjust. Most of you are aware of the reorganization we announced this spring. It was designed to restructure and strengthen the entire operation, so that when the economic crisis passed, Sony would already be on the way to providing even more compelling products. Today we do not view ourselves as a company operating in the middle of an economic crisis, or waiting for one to pass. We are aggressively and strategically running our business in a new and permanently changed reality -- one that we must meet head-on every day. I am very positive about where we are as a company, what we will provide to consumers, and how we will differentiate ourselves going forward.

Before I give you some examples, I would like to introduce two of our “architects of change” who have joined me here today – Hiroshi Yoshioka, Executive Deputy President and Officer in charge of the Consumer Products & Devices Group, and Kaz Hirai, Executive Vice President and Officer in charge of the Networked Products & Services Group.

I am also very happy to welcome Bert Nordberg, a long-time senior executive at Ericsson who has just joined Sony Ericsson Mobile Communications and will officially become its President in October. (A round of applause for these three gentlemen.)

The work that Yoshioka-san, Kaz, Bert and I do together touches and unites all aspects of Sony -- from products and design, to networked services and connectivity, to the creation and distribution of content. It is where our history, our vision, our expertise, and our relationship with the customer all converge. I’m very happy and proud to have them as colleagues.

Now I would like to share some thoughts on two very promising new areas where the collective strengths of Sony can blaze a path of leadership again.

As you know, Sony has been at the forefront of high definition (you will see that again in the booth this week), in Blu-ray, in videogames, and in the creation of groundbreaking content—through our pictures and music businesses--and its delivery to consumers.

Today, 3D is clearly on its way to the mass market. As with high definition a few years back, there are a variety of issues yet to be addressed. But the 3D train is on the track, and we at Sony are ready to drive it home.

On the theatrical side, the number of 3D digital screens in cinemas around the world has increased by nearly 30-fold in the past three years.

It is expected there will be more than 7,000 digital 3D screens worldwide by the end of this year. This rapid expansion is being driven by increased consumer demand for 3D films, as well as higher ticket premiums.

Sony has proven its expertise in 3D in the theatrical release arena with a wide range of products, including our highly touted 4K digital projectors. In the U.S.the Regal cinema chain plans to install up to 1,500 3D systems across their network of theatres. And we expect other operators, such as AMC, to follow. Our 4K digital projectors are being installed in cinemas across Europe, including 140 screens in the U.K.’s Apollo Cinema and Germany’s CinemaxX chains, with nearly 100 of those equipped for 3D.

Sony’s technological leadership, together with our ownership and unique understanding of all forms of content, means that we will be able to deliver the entire 3D value chain, both to our customers in the movie creation and distribution business and, of course, to consumers in cinemas, or at home on a variety of Sony devices.

A great example of Sony’s range of content is the Sony Pictures Entertainment 3D animated film, “Cloudy with a Chance of Meatballs.” It will be released on September 18 in the US and is being projected here today using the Sony 4K digital projector. Let me ask you now to put on the 3D glasses provided by RealD. I would like to thank the team at RealD, who have been instrumental in working with our digital cinema team to help us launch the Sony 3D projector now deployed in cinemas around the world. Let’s take a look at the trailer for “Cloudy” in 3D.

Clearly, 3D has already captured the imagination of filmmakers and content creators. Sony is moving to bring that magic directly into consumers’ homes with movies, games, and sporting events, all in 3D, in 2010.

We will provide a complete user experience with full HD BRAVIA in 3D taking center stage. In addition to television, Sony will enable more devices, such as Blu-ray, VAIO and PlayStation 3, to be 3D compatible.

Industry-wide, the commitment to 3D is growing. Sky is committed to introducing a 3D satellite channel next year in the UK. The Blu-ray disc association is very close to finalizing the standards for storing and playing 3D movies on Blu-ray. Their solution has the full support of the Hollywood studios. As a member of the BDA Board of Directors, Sony is actively engaged in developing the specifications, because Blu-ray’s high capacity will result in the best 3D experience for consumers.

Let’s take a look at a montage of some of the 3D programming you might watch on our BRAVIAs next year, including football from the FIFA Confederations Cup, which was filmed with Sony cameras, and an example of 3D gaming on PlayStation 3, in the form of two short excerpts from MotorStorm: Pacific Rift and Gran Turismo.

I encourage you to visit the booth later, where you will be able to experience sport, movie and game content on our 3D Full 1080P High Definition BRAVIA.

Another area where Sony is leading the way is the digital distribution of all types of content on devices.

Two weeks ago at Gamescom in Cologne, we announced the new PS3. It went on sale yesterday at two hundred and ninety nine euros. We also showcased our PlayStation Network, a key priority for Sony for the distribution of content.

PSN is now accessible in 58 countries in 12 languages and in 22 different currencies. PSN services started in November 2006, and the number of registered accounts on PSN has now grown to more than 27 million. Just think about that: over 27 million touch points for content and devices in a little more than three years – that is a groundbreaking development.

The PSN video delivery service in the U.S. now offers over 12,000 TV episodes and more than 2,200 movies, with more than 35% of those movies in HD. It will launch this November in France, Germany, Spain and the UK, with other European markets to follow throughout 2010. At launch, the service will feature hundreds of movie titles, and content will be added regularly as the service expands. Consumers will be able to download for purchase or rental to both their PlayStation 3 and PSP, and share the content between these devices.

Unique amongst next generation consoles, the PSN video delivery service will offer high quality entertainment from all major movie studios. as well as local content from European partners, including Constantine and Universum right here in Germany.

Let’s take a look at what the video delivery service in Europe has to offer.

Leveraging what we’ve done with PSN, next year we will expand our network service to a variety of Sony’s consumer electronics products. This will provide consumers with even more ways to enjoy these content offerings.

3D and PlayStation Network are but two of the key pillars in our overall strategy -- exciting new areas where Sony can lead the industry and provide the very best experience for the consumer.

But before I conclude, I want to share with you an exciting new brand initiative that defines the core spirit and the mission of our company. It brings together not only the great legacy and promise of Sony, but also the spirit that has propelled us for over 60 years, and will drive us in the future.

As you know, Sony is a technology company with an intimate understanding of the creative possibilities of content. But Sony is also a content company with an intuitive grasp of technology. No other company has this unique combination of resources.

The strength of Sony is its spirit of creativity, its ability to turn ideas into reality, the belief that anything we can imagine, we can make real. We call this “make.believe.” It is our new global brand message – the first ever for Sony – and it begins here, today.

Think of a time when you made something happen -- something that you weren’t certain was possible, but worked passionately to make a reality. An idea that began in your mind and blossomed into something that wouldn’t have existed without you. That is the spirit of “make.believe.” Our goal is for consumers around the world to embrace the “make.believe” spirit by contributing their own creativity and passion to the process, and discovering how all that is Sony—our products, our content, our services--can make their dreams real.

“make.believe” is where inspiration meets creativity, where creativity meets reality. It connects designers and engineers, hardware and content, electronics and entertainment, Sony and consumers.

Over the next six months, you will begin to see “make.believe” in Sony advertising, promotional materials, product packaging, retail outlets, online content, and more, in a phased roll-out across the globe. From here, the message will extend to China later this month, followed by Tokyo and the rest of Asia and South America, before its North American debut in January 2010.

We are introducing this brand initiative now because Sony is in the midst of a pivotal transformation. “make.believe” is a symbol of the new Sony. It is designed to work alongside our existing sub-brands and across all of our businesses, from electronics, to movies, to music, to games, to mobile communications. It will be used to connect all of our brands, products, services and content so that the consumer will--for the first time--see a truly united Sony.

I’d now like to hand the proceedings back to Fujio to talk about some of the new and exciting products we will be bringing to Europe later this year. Thank you for listening and enjoy the rest of the show.

NISHIDA: Thank you Howard. Make.believe is an exciting development and a true reflection of the new spirit of Sony. We are looking forward to demonstrating that new spirit here on our booth at IFA and in the coming months.

For the next 30 minutes or so I would like to introduce you to some of the new products we are launching this year, talk about some of the value added services we will be including in those products and brief you on our environmental activity.

Now, the huge revolution we have seen in video watching here in Europe and elsewhere has been driven largely by short-form, user generated content available over the internet and watched on a PC. You Tube is just the biggest example of this world wide phenomenon.

More people are watching videos on their PCs than ever before – 76% of internet users in Europe watch videos, up from 60% last year.

And of those, more than 70% say they watch less TV as a result.

However, we are now into the second phase of European online video growth, and this time the growth is being driven by broadcasters who are making their TV programming available to viewers over the internet through sites which offer long-form TV content often for free. These services, sometimes known as ‘catch-up TV ‘ are becoming more common as broadcasters see the opportunity to make their programming available to a wider audience. And they are becoming increasingly popular – in the UK last year nearly one quarter of all households watched catch up TV online through their PC.

But watching long-form TV programmes on a PC is an unsatisfying experience. TV programmes were intended for the ‘sit back’ nature of the television, not the lean forward attitude required when watching on a small screen on a PC in the study or bedroom.

Wouldn’t it be a much more enjoyable experience if these programmes could be delivered straight to the TV and watched in the Living Room by the whole family?

Of course it would, and that it is precisely what Sony will make possible early next year with the launch of new BRAVIA TVs ,Blu-ray Disc players and Blu-ray home cinema systems with a new function, BRAVIA Internet Video.

BRAVIA Internet Video will enable viewers to experience online TV programming in a natural, relaxing position in a Living Room environment through all of these devices, with just a single remote control.

With Sony’s Emmy award winning Cross Media Bar interface, BRAVIA Internet Video will free viewers from the limitations of TV scheduling and provide internet based catch-up TV services direct to the television. We are pleased to announce that as of today, broadcasters from Germany, France, Italy, Spain and the UK have confirmed that they will join us in a trial to provide their catch-up programming on Bravia early next year.

In addition to catch-up TV, BRAVIA Internet Video will also offer free video content from traditional internet based video sites such as YouTube and Daily Motion.

As we refocus the centre of home entertainment once again on the Living Room there remains one more consumer irritation to resolve - and that is the large number of additional boxes that are often attached to the TV. We can’t replace all of these boxes overnight, but to reduce some of this clutter, from October onwards, many of our new Bravia TVs will come equipped with a combination of built-in satellite, cable and terrestrial TV tuners.

This means that where we have agreements with broadcasters there will be no need in future for a cable or satellite set top box, and as a result for example, users in the UK will be able to receive access to a wide range of free TV programmes from FreeSat, a digital satellite channel which broadcasts free high definition programmes from the BBC and ITV.

To maximise the benefits of catch-up TV we have available our Blu-ray Disc player with built-in wi-fi for easy access to BD Live and our excellent home cinema systems which provide the best possible reproduction for your viewing experience.

Digital imaging is another area where the technology has improved dramatically over the last year.

The introduction of Sony’s Exmor R sensor, first seen earlier this year in the EISA award winning XR520V camcorder has raised the bar in terms of image quality.

With double the sensitivity of conventional sensors the Exmor R completely revolutionises low light shooting, letting users enjoy cleaner and higher definition images with less noise when shooting in dark environments such as indoors and night scenes. The result is images of superb quality and resolution with extremely low noise.

The combination of advanced sensors and image processors has also dramatically improved the quality of digital still images and this is nowhere better demonstrated than in the new Sony Cyber-shot models – the TX1 and WX1 where optical, imaging and processing technologies come together to deliver pristine picture quality, smart shooting features and colourful looks. They deliver this vastly superior image quality thanks to a new “Exmor R” CMOS sensor and the latest version of our imaging processor “BIONZ”.

The WX1 and TX1 can also take breathtaking panoramic views by automatically assembling individual frames shot at high speed. Sweep Panorama allows users to record a panoramic view within one second through use of the camera’s high-speed continuous shooting mode.. Simply press the release button and sweep the camera for about three to ten seconds in the selected direction and the advanced “BIONZ” Imaging Processor stitches the whole image together in less than a second.

You can take the enjoyment of still photography to an altogether new level when you team these new Cyber-Shots with our new Party-Shot camera cradle that will sit in the background to your party and automatically take shots of those present. Using Face Detection and Smile Shutter technology embedded within the camera, Party-Shot automatically adjusts the composition by swivelling and zooming to give you a terrific photographic record of all the happy and funny parts of your event.

Let’s have a look at a short video of these new features made possible by the new Exmor R sensor.

Strengthening Digital SLR has been one of the priorities in our digital imaging business.

We have just announced three new DSLR models: The Alpha 500 and 550, exceptional ability to capture fast moving objects with their very fast shooting capability

The new Alpha 850 meanwhile is our new full sized imager model for highly skilled amateur users. With the new Alpha range now complete, we hope to attract more photographers to Sony’s world of imaging.

And what better way to highlight and celebrate Sony’s digital imaging than with a world first event.

On 22nd September, Sony will stage a global event called Twilight Football. As the hour of twilight moves across the world, a series of seven football matches will begin. Each match takes place in a location chosen to provide a spectacular and beautiful background for a truly unique activity.

Twilight provides a stunning natural ambient light, the ultimate canvas for the one-off, unpredictable moments that a football match always provides. Sony is celebrating these incredible moments by giving teams of amateur football players and budding photographers from around Europe the chance to create their own moments of history, captured on Sony’s innovative products.

It will not have escaped your attention that the environment is one of the key themes around IFA this year. The environment is now very much on the minds of our consumers and they expect our industry to deliver products that minimise the impact on the environment, and to ensure that our processes and operations do likewise

At Sony we believe that technology need not always be part of the problem - it can be part of the solution! We have already accomplished remarkable contributions through our environmental commitments globally and are especially proud of our key milestones in Sony Europe,

We recently announced that almost all of Sony’s sites in Europe are powered by 100% renewable energy. This is, I believe, an unprecedented achievement in the European consumer electronics landscape.

One example which I would like to highlight is our disc pressing plant in Salzburg which takes its energy exclusively from a hydro electric facility that provides renewable energy,

Through a variety of energy conservation measures the plant became 100% powered by Green Energy two years ago.

Furthermore, Sony’s European operations have reduced CO2 emissions by approximately 90% since 2000 by introducing energy saving programs and the usage of renewable energy.

But it is clear that our efforts cannot end here. We realise that most our carbon emissions come from the use of our products and this is another area where we have made impressive improvements. Indeed, our flagship green TV, the BRAVIA WE5, consumes 50% less energy than its predecessors.

Needless to say, we are also investing in a number of future eco technologies that will help realise a greener lifestyle for consumers.

Our global ethos entitled ‘For The Next Generation’ is not only centred upon eco. Our far-reaching activities embrace social responsibility in the widest sense and are at the heart of all that we do.

Using the magic of football, we have also embarked on a truly unique and exciting relationship with streetfootballworld, the CSR partner of FIFA. Its mission is to drive positive social change through football. Sony and streetfootballworld are working together to give young people in disadvantaged communities the opportunity to acquire skills in media and technology.

Sony’s eco activity spreads across all parts of the Sony Group. Earlier this summer Sony Ericsson announced two new ‘Green Heart ' pioneer products - the C901 GreenHeart and Naite - which introduce a number of eco-conscious features like recycled plastic casings , a built-in manual to save paper usage , above-average energy management, and a low-power phone charger. Sony Ericsson intends to reduce the environmental impact of their portfolio by gradually adding these eco features throughout their entire line up.

Sony Ericsson is also committed to providing consumers with a new generation of smart phones that blur the boundary between work and play.

It gives me great pleasure therefore to announce this evening the new Sony Ericsson XPERIA X2, the first mobile phone to showcase the latest Windows 6.5 operating system, which Microsoft launched just yesterday. The XPERIA X2 removes artificial boundaries between work time and play time.– it’s a sleek, smart device ideally suited to the 24/7 lifestyle. For work, the X2 is like a fully functional laptop in your pocket. Not only does it have great enterprise features like Outlook synchronisation and the ability to read and edit Office documents on the go, but it also has a TV out socket that allows presentations to be made directly from the phone. For life outside of the office the X2 has all the essential entertainment features you have come to expect from Sony Ericsson phones - an 8.1 mega pixel camera, finger friendly internet browsing, great mobile gaming and a Walkman quality music player.

The XPERIA X2 goes on sale around the world in Q4 and we would like to invite you to join the detailed Q&A session which Sony Ericsson will be hosting in the Business Centre on our booth at 6.30p.m. after the press conference.

A key product in the new and rapidly growing e-reader sector is the Sony Reader. DisplaySearch estimate that the global market for e-books will grow to 77 million units worldwide in 2018, up from about 1 million units two years ago – so there is a lot to play for.. Our first model, launched last year in limited countries, proved a huge success, exceeded its forecasted sales and quickly became the industry’s top selling item. It also became one of most popular gift items during the last Christmas holiday season.

So, I am delighted to introduce two new models to the Reader family this evening – the Reader Pocket Edition and the Reader Touch edition.

The Reader Pocket edition is available in a range of colours and has a slim, lightweight design that slips easily into a purse or jacket pocket so you can escape to a good book wherever you go. Easily navigated with one hand, it features a 5 inch E Ink, paper-like screen for a real reading experience, even in direct sunlight.

The new Reader Touch Edition has a 6 inch touch-sensitive screen that allows you to get interactive with your Reader: you can highlight text, search for a word or book, or simply double-tap on a word to find its meaning in the built-in English dictionary.

Both models support multiple file types for a huge choice of classics, bestsellers and new titles to buy or download for free and can hold up to 350 ebooks at a time - or almost 13,000 books if you use an optional memory card in the Reader Touch. And the long life battery will allow you to make up to seven and a half thousand page turns on a single charge – that’s the equivalent of reading Tolstoy’s War and Peace from cover to cover five times before needing to recharge your Reader.

The launch timing of these new models, together with a range of accessories, will differ from country to country, but customers in the UK, Germany, France, Netherlands, Austria and Switzerland will see them in the shops very soon.

Our Walkman range continues to expand, hot off the back of the X Series winning the prestigious EISA Award.

The new S540 is the first ever WALKMAN video MP3 player to feature two high-quality built-in stereo speakers, making it the perfect choice for anyone who loves sharing their music. Using Sony’s unique digital audio technology, this delivers great Stereo sound from an ultra slim body. The S540 comes in a choice of four contemporary colours and also features a large, bright colour screen, FM tuner and on-board voice recorder. The S540 also supports a wide range of formats, making it ideal for enjoying downloads from online movie stores and video clips from sharing sites. There’s even a handy stand accessory supplied for comfortable ‘hands-free’ viewing.

And with the new S540 series we now have a Walkman for everyone with an impressive line-up from the flagship award-winning X-series with OLED touch-screen, to the E series Walkman range, now also available with a portable speaker option to allow you to share your music. Audio players complete the Walkman offer with the uniquely designed W-series Wearable Walkman for active users and our affordable B Series for our younger customers.

Last but not least, I would like to give you a preview of the Vaio X series which will be launched this autumn. We strongly believe that VAIO’s strength lies in its mobility. VAIO X is the model that takes the concept of true mobility to its extreme - it weighs less than 700 grams, has an 11.1 inch LCD screen and is less than 14 mm thick. It also has built-in 3G wireless communication for mobile broadband and the quality of build is exceptional, with a carbon fiber casing and a one-piece keyboard panel. Not only that but it has a range of battery options that will set new standards for stamina, lasting all day and well into the night – ideal for today’s demanding road warriors.

And the stunning new Vaio X draws our press conference to a close here at IFA. We have shown and demonstrated our strategy for 3D, talked about how our 3D Bravia will reclaim the Living Room as the hub of home entertainment, explained about our Bravia Internet Video service, and of course shown you some terrific new products, like this great new Vaio, all of which are on the booth for you to enjoy. All that remains is for me to thank you once again for coming this evening and to invite you to tour the booth which is now officially open. Thank you very much.

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