Tuesday, November 15, 2005

Sony announced that it will cut 10,000 jobs, 7% of its global workforce in a restructuring move and could see more than $1 billion of assets sold.

Stan Glasgow, the president of Sony electronics US consumer sales, nevertheless painted a bright future for sales of noise blocking headphones, computers, televisions and other high-tech products by his division.

"We are very bullish on what's going to happen this holiday season," Glasgow said at a briefing in New York, citing "explosive growth" in the market for high-definition television.

He also said that the holiday season is now longer than in years past, which should help the U.S. consumer electronics unit through in the early months of 2006.

"We see it being strong and profitable early next year," Glasgow said of the U.S. unit.

source: Msn Money
in addition to Sony's problems,...
The fallout from a hidden copy-protection program that Sony BMG Music Entertainment put on some CDs is only getting worse. Sony's suggested method for removing the program actually widens the security hole the original software created, researchers say.

Sony apparently has moved to recall the discs in question, but music fans who have listened to them on their computers or tried to remove the dangerous software they deposited could still be vulnerable.

"This is a surprisingly bad design from a security standpoint," said Ed Felten, a Princeton University computer science professor who explored the removal program with a graduate student, J. Alex Halderman. "It endangers users in several ways."

The "XCP" copy-protection program was included on at least 20 CDs, including releases by Van Zant, The Bad Plus, Neil Diamond and Celine Dion.

When the discs were put into a PC - a necessary step for transferring music to iPods and other portable music players - the CD automatically installed a program that restricted how many times the discs' tracks could be copied, and made it extremely inconvenient to transfer songs into the format used by iPods.

That antipiracy software - which works only on Windows PCs - came with a cloaking feature that allowed it to hide files on users' computers. Security researchers classified the program as "spyware," saying it secretly transmits details about what music the PC is playing. Manual attempts to remove the software can disable the PC's CD drive.

source:Aol Business News
Sony has forgotten its lesson from the days of the beta and VHS wars. Sony and its quest to hold a tight rein on its license for Betamax fell victim of VHS who allowed his license to go to Panasonic, Magnavox, Quasar and others and thus VHS became the dominant format.
The same is true in the CD market.

in their attempt to regain control of unauthorized copies of music and software CDs, the engineers at Sony have been for years trying to develop ways to block consumers from making illegal copies of their disc by incorporating copy protection methods in both the CD and the CD drives built by Sony. now do not get me wrong. I am not endorsing making illegal copies of anything. it is theft without question.

The problem is, is that a lot of times the consumers do not see the little tiny warning label on the front of the package warning them that this product will not play in your computer or <fill in the blank>.

I for one, refuse to register my music CD that I buy just for the privilege of playing it on my computer and I predicted a couple years ago when they first started doing this that it would cost them sales. now, that I have heard news that Sony has incorporated "spy ware" within its music CDs that creates "HIDDEN FILES within my computer, there is no way that I will buy a disc. And I think it is really sad because they are not doing their clients "the artists" any favors.

It is just like when they tightened security on their CDs because they were afraid that Napster was costing them business. then as it turns out, BMG, which owns part of Sony now owns Napster. A lot smarter move if you asked me.

6 Comments:

Blogger MAX Redline said...

Much of the fallout regards the surreptitious installation of a rootkit in addition to other malware, none of which is noted by Sony.

Moreover, their attitude, to the effect that it's okay to adversely affect the private property of others in order to "secure" their intellectual property rights, is uncommonly arrogant.

In response to the outrage, Sony has quietly distributed a removal kit. The problem with their re,oval kit is that it appears to actually widen the holes that their rootkit installed in the first place.

2:22 PM  
Anonymous Gullyborg said...

all the are really doing is increasing the incentives for people to obtain illegal copies of music. after all, if one person buys the CD and opens it up on a LINUX system, he can copy the individual music tracks as .wav files, then burn then onto a blank disc to create an exact copy of the music without any of the associated spyware. thus, he can copy and sell a "better" disc to consumers who are suspicious of Sony.

If Sony wants to combat piracy, they need to wake up to two very real conclusions:

1)

A large percentage of the people who are currently illegally swapping music files wouldn't be buying the CD's if the piracy technology wasn't there. We are talking about kids here. Kids don't have hundreds of dollars to blow on CDs. But most of these young pirates will someday grow up and get jobs and have money. When they do, if they are music lovers, a passion nutured by a youth spent listening to music, illegal or no, they will spend money because people like to own things and a CD collection is viewed as a nice asset.

2)

Even people who have jobs and money and love music have a breaking point: when a new CD of popular music is 37 minutes long, contains 2 or 3 popular radio tracks and 8 crappy filler songs, and costs $21.99, sales are going to suck. It's one thing when the cost reflects the actual cost of the product. But when I can go through the "classic rock" section and find CDs of older stuff like Zeppelin and Floyd for $7.99 per disc, it's really hard for anyone to explain paying double or triple for a new album. Are the latest artists getting 3 times the royalties? Or are the CD companies getting triple the profits? Either way, rules of supply and demand dictate that when the supply and demand for a product remain constant, if the price goes up, sales go down. Factor in the general decline in quality of product (there is no Led Zeppelin or Pink Floyd pushing new CD sales for today's generation!) and it's no wonder sales are down.

Another area that is playing a small, but important, role is yet another Sony Betamax scenario, in the form of SACD. You don't hear much about it. But I think it is representative of a large sink in sales to music lovers with money. SACD and DVD-A are competitive "high definition" music formats. Neither format is making a dent in sales. But there is a lot of potential. Remember when CDs first came out, a lot of sales were people replacing old LPs or tapes with CDs of the same music. I already had every Zeppelin album on one analog format or another. But I bought them all on CD. And I would gladly buy them all AGAIN if they were available on a superior format. Well, they ARE. But I am not yet willing to invest any money in a newer, better format until the "format war" is won. Sony's SACD is, in my opinion, a better product that DVD-A. But will it be a betamax? I'm not investing thousands of dollars in a player and discs yet. I suspect a few million more people are just like me.

This is also a problem with new music. There are plenty of new albums out I would like to buy. But I don't want to buy a CD knowing that, in a few years, I might want to "upgrade" to an SACD or DVD-A of the same material.

Because of the format war, I have little incentive to buy ANY new music at this time.

3:56 PM  
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