When I was mulling my tricky stock for this year, some scary movies popped to mind. (I'm a horror-movie aficionado -- what can I say?) So let's take a walk down the dark memory lane that is Sony's
Creepy watchers: Halloween, Play Misty for Me
The spyware controversy from last autumn made me question whether Sony had forgotten how to treat its customers. Nobody likes a stalker -- especially not one that sneaks around on their PCs without asking.
When machines misbehave: Hardware, Maximum Overdrive
Sony's bearing the brunt of a massive battery recall, thanks to the reports of batteries occasionally smoking, overheating, throwing off sparks, or catching on fire. You've probably already heard the list of affected PC makers -- Dell
At the Tokyo Game Show, some PlayStation3 machines supposedly overheated and stopped working. Sony said it was because of crowded conditions and poor ventilation, but some gamers fear the worst. (Microsoft
Extreme loss of control: Evil Dead 2, The Exorcist
Ever get the feeling the left hand doesn't know what the right hand is doing? In Evil Dead 2, hero Ash had the unfortunate experience of having one of his hands become possessed. I won't give you the gory details, but his solution involved a gag inclusion of the book A Farewell to Arms. And of course, The Exorcist is a great example of not really feeling like yourself.
More than once, Sony has said one thing, only to have another thing happen sooner or later. For example, it seemed to shrug off the battery issue at first, and but it now turns out that the recall has affected just about every computer maker -- not to mention Sony's financial outlook for this year. PlayStation 3 was all set for launch in the spring, despite rumors to the contrary . until it wasn't. Then Sony revealed that it will launch only about 400,000 units here in the U.S. in November, although it expects to roll out many more by year's end. Its new Sony Reader product was late out of the gate, too.
Bad luck blues, and when dreams go bad: Friday the 13th, Nightmare on Elm Street
I'm not saying "Abandon hope, all ye who enter here." It's not that Sony's problems aren't fixable, but it'll have to make a serious effort to recover, as its most recent quarterly report amply shows. Some investors might see Sony as a beaten-up bargain, but that conclusion seems premature, given the omens and portents here -- not to mention its P/E ratio of 33. I fear that the electronics giant faces an uphill battle to prove that it has fixed many of its problems, like quality control, interorganizational communication, and even customer friendliness. Investor, beware.
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Alyce Lomax does not own shares of any of the companies mentioned here, but she has seen all of the movies.
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