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Facing big layoff, Sony China staff hold protest
Staff gathers outside Sony China building for protesting against big layoff.  Photos: weibo.com

About 800 staff from Sony Mobile Beijing will be laid off as the Japan-based international company plans to substantively shrink its mobile phone business in China, which will discontinue special products targeted at the market.  
 
Dozens of Sony staff gathered in front of its Beijing office building in the morning of November 4 to protest against non-transparent method of layoffs. The protesting staff were mostly from Sony Mobile's R&D department, demanding the release of retrenchment list and consultation on an equal footing, and deploring arbitrary way of layoff and discrimination.
 
On October 11, Sony Corporation published its 2014 annual revenue forecast, which showed that for the fiscal year ending next March the company will lose over 2.1 billion US dollars, with mobile business being the major culprit. Ever since then, there has been rumors that Sony China mobile phone devision will undergo major adjustments, although at the moment the news hasn't been confirmed officially. 
 
In its second-quarter financial report for the financial year 2014 released on October 31, Sony disclosed that affected by bleak mobile business performance, it suffered a huge loss of 1.2 billion US dollars. 
 
Sony said that senior executives announced to build “operative framework for its mobile business that could guarantee stable inflow of profits”, and so Sony Mobile would considerably cut down its scale in China; meanwhile, Sony Mobile will terminate R&D for specific models targeting the Chinese market, although general models would still be sold, the Caixin magazine reported. 
 
The company also claimed that under the leadership of new management in office from October 30, Sony Mobile will accelerate restructuring. And specific reform contents would be publicized at the investors' conference on November 25, the report said
 
Sony also indicated that among the 1000 staff which are about to be laid off globally, a large part would be from China. “After the headquarters meeting on October 31, our staff at Beijing mobile department got to know that 800 people would be laid off here and most of them would be from R&D department, although we don't know about the exact name list,” the Caixin cited an R&D engineer with Sony Beijing as saying.  The source also disclosed that many people are upset about the lack of transparency. 
 
The protest started at 11 o'clock in the morning. At first, only 40-50 people came and then so many more gathered later that the police had to be called. “The management for R&D and human resources reluctantly showed up, trying to explain the situation, although most protesting staff didn't feel they got what they wanted,” said the engineer. 
 
Around 1 o'clock in the afternoon, protesting workers gradually dispersed. The management, responding to protests, held an unofficial meeting in the afternoon at 3 o'clock, with around 300 staff present. 
 
According to the anonymous engineer, the company's Beijing Mobile devision has around 2000 staff, with over 1000 in R&D. “The Beijing R&D department is believed to be shut down, because Sony mobile phones have low market share, with the percentage being 3% two years ago, and now barely 1%,” he said. 
 

Sony Corporation has not yet given any specific timetable for the layoff plan. 
 
Sony used to be one of the top players in the field of consumer electronics, but in recent years the company has struggled in the face of the rise of brands from China and South Korea. 
 
Sony had high hopes for its mobile phone business in the past year, while based on its 2014 annual revenue forecast, by the end of March next year, the company will lose over 2.1 billion US dollars. 
 
The company also said that it has overestimated revenues from smartphones and tablets. And it already announced to cancel annual bonus, which would be the first time since it went public in 1958. It has lowered the sales forecast from 50 million to 43 million sets. 
 
Recent years have witnessed the company trying to revive its fortunes. Under Kazuo Hirai's “one Sony” strategy, the company has been narrowing its business scope, with mobile devices being its prime focus. However, performance of the products became a huge disappointment. The company blamed the loss on considerably changing market environment, which means the rise of China's Lenovo and Huawei in mid to and low-end markets.  
 
According to the engineer, the decline of business in China should be blamed on the company's troubled sales and decision-making strategy. “For example, If we'd like to do new products, all models must pass headquarters' approval and verification. There is limited room for R&D work, and the products thus lack diversity.

The article is translated and edited from a Caixin news. 
 

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