Sony Optiarc Inc will cease production of CD and DVD drives by March 2013 according to sources who spoke to The Asahi Shimbun newspaper. After huge losses in 2011 Sony decided several loss making and struggling divisions must face the chop. This latest restructuring move by Sony will lead to the early retirement and reassignment of 400 or so employees.
Sony Optiarc originated in 2006 as a joint venture with NEC, whom Sony bought out in 2008. Sony ODD drives enjoy a 15 per cent market share. With increased competition for fewer ODD sales Sony has decided to cease production as part of its goal of cutting 10,000 people company-wide. This goal was set in response to Sony’s net loss of $5.8 billion in 2001. Sony also has cut production in its chemical business and mobile phone factory in Sweden.
The popularity of optical drives seems to be on the wane in computers. The trend among content consumers is toward tablets. New portable hybrid devices and Ultrabooks are also shunning a built-in ODD, leaving only desktop computer owners as sure-fire ODD installers. For various kinds of backups computer users are favouring external HDDs, cloud storage and USB thumb drives. Even the home entertainment market is moving away from physical media and people are watching more streaming services and downloaded movies. Witness the decline of Blockbuster and the rise of streaming companies such as Netflix etc. The games industry also would like to move to downloads and cut out the retailers.
Sony will continue to make a range of consumer electronics which contain DVD and Blu-ray players. Obviously ODD drives for these devices will have to be outsourced some time after March 2013.