Sony Corp. (SNE) was once perceived as the creative young upstart Japanese electronics company that could do everything better than the competition.

This company was the king of innovation. It essentially popularized the VCR (although its Betamax format lost the war with VHS), made the VCR legal (that was before it bought a Hollywood studio), popularized smaller studio video cameras, popularized the helical-scan professional VCR, created mobile audio with its Walkman, helped invent the CD, dominated the market for high-quality TV sets, and on and on.

But its best skill today is to take a gun, target its own foot and shoot it.

The latest fiasco is the recent revelation that Sony's Blu-ray player for the PC will not have the ability to play HD movies on the PC. This is to protect the interests of the movie makers somehow.

Are they kidding us?

Sony has been in a steep decline, as far as innovation and clear thinking are concerned, for at least a decade.

The first time I noticed this was around 1996, when Sony showed off its first Vaio desktop computer. Nobody heard much about it, and it was a huge flop, despite being well-made.

I was at a trade show when this thing was released. I specifically asked the marketing team about the machine, wondering why we got no review units at PC Magazine and in fact weren't even told about the thing, either in advance or when it actually shipped.

I was told flat-out that Sony wasn't interested in computer magazines, because they were going to sell the machine to the public at large.

This made no sense, of course, since the public at large is overtly affected by computer magazines and what experts think about things. That's true whether the public wants to be influenced or not.

Simply bypassing the mechanism because some bonehead at the company thought it was a waste of time to talk to computer magazines was brain-dead thinking. The results were apparent.

Over the years since, things have worsened.

The company would plow through public-relations firms like nothing I've ever seen. Every so often, they'd get one that catered to a segment of the market that I wrote for, and I'd personally find out something about a Sony product.

Then I'd hear nothing for years. It was laughable to watch these folks operate.

It's not a big surprise to find Japanese companies failing with marketing and P.R. in the U.S. market. Few do well, since they tend to take orders from Tokyo and base their decisions on the Japanese market rather than the American market.

But for a while in the late 1960s and 1970s, Sony seemed to have a clue about this and became synonymous with quality and innovation in the U.S., much to the chagrin of other large vendors such as Matsushita. (MC)

The true beginning of the end for Sony actually started in 1988, when it paid $2 billion for CBS Records and in the next year bought Columbia and Tri-Star pictures.

Instead of being an innovative electronics company, Sony got into the content business. Worse, it got into that business during the beginning of the digital revolution, when content would be cheapened in true value by virtue of the fact that it could be easily turned into bits and bytes and sent around networks by the public.

So did Sony want to be the company making the devices to do this digital thing? Or was it more interested in the content that it needed to protect from the reality of a digital world?

In this way, Sony created a conflict of interest between its future as an electronics innovator and its association with an old business that would be threatened by the digital landscape.

Of course, Sony could have led the way into new business models that might have revolutionized the movie and record businesses, but it didn't.

Instead it adopted a conservative ideology that would not serve its innovative soul in any way.

In fact, the company obviously killed whatever innovative soul it had. And now Sony languishes while exhibiting an odd, inexplicable arrogance that cocoons everything it does and every decision it makes. It's a shame.

Sony's marketing mantra has sadly gone from "Sony. No baloney!" to "Sony? No. Baloney!"

A fine but important difference. It doesn't take much to foul up a good thing.

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