Sony could be in 'serious trouble', says Hirai

Sony President Kaz Hirai has admitted that the company could be "in some serious trouble" if it fails to turn around its falling stock and losses in revenue.
"We really need to buckle down and be realistic," Hirai told The Wall Street Journal.
"I don't think everybody (working at the company) is on board, but I think people are coming around to the idea that if we don't turn this around, we could be sitting in some serious trouble."
"I thought turning around the PlayStation business was going to be the toughest challenge of my career, but I guess not. It's one issue after another. I feel like 'Holy ****, now what?'"
It was announced earlier this week that Kaz Hirai will be replacing Sir Howard Stringer as President and CEO of Sony from April 1st.
But what sort of implications could Sony's troubled finances have on Sony sub-division Sony Computer Entertainment, where Hirai has spent the majority of his career?
Sony is currently expected to be working on a successor to its PlayStation 3, but high research and development costs coupled with high manufacturing costs could mean that the firm may not be in a position to announce new hardware for a while to come.
Console manufacturers typically sell consoles as loss-leaders during the first phase of their product life cycle, selling the product below the cost of manufacturing to create a larger install base, and make profits on software sales and improved margins further into the product's life cycle.
Given Sony's troubled finances, it's debatable as to whether the firm can currently afford to soak up costs involved with becoming a loss-leader.
Hirai has always stated that he expects the PlayStation 3 to have a "ten year life cycle". The console first released in November 2006.
The company's latest piece of hardware, PlayStation Vita, is due to launch in the UK on February 22nd. The hardware has already failed to sustain sales in Japan.
Source: http://www.gamerzines.com/ps3/news/sony-serious-trouble-hirai.html