Sony and Netflix Team Up to Provide Ultra High-Definition Content


Sony Corp. (NYSE:SNE) and Netflix, Inc. (NASDAQ:NFLX) are teaming up to bring 4K video to consumers, according to a tech blog from the Wall Street Journal. Sony’s new ultra high-definition televisions are at the forefront of new television technology, which is often dubbed UHDTV or “4K,” due to 4,000 pixels in the screen when measured horizontally. Such swanky new televisions promise to offer resolutions 4 times that of standard TVs, a prospect that Sony will help make up for a lull in television sales over the past several years.

Content (as well as a hefty sticker price) has been a big barrier to Sony’s breaking new ground in the market, however; programming hasn’t caught up with the new technology just yet, and there isn’t much that’s currently offered in 4K; most existing cable and satellite networks only support the standard high-definition resolution.

The content availability issue is part of why Netflix’s willingness to partner with the electronics company is such good news for Sony. Netflix CEO Reed Hastings even made a surprise appearance at Sony’s News Conference ahead of the 2014 Consumer Electronics Show in Las Vegas, saying Netflix will begin offering content at the super high-definition resolution over the internet.

“All of the new originals for Netflix are going to be in 4k,” Hastings said, which includes the second season of the political drama “House of Cards.” The 4K content is expected to be available in mid-February, per the Wall Street Journal. TV analysts seem to agree that more content will inevitably increase sales of Sony’s UHDTV, many are still skeptical as to how to whether the new partnership and added content will have a tangible impact on Sony’s ability to turn around its business, as demand for traditional electronic devices, such as televisions and personal computers continues to experience decline.

Kazuo Hirai, new CEO at Sony, began the news conference by saying, “In one short year, the consumer electronics landscape changed dramatically. Markets shrank, changed and some all but disappeared,” according to the Wall Street Journal. The statement comes months after Sony shocked the market in October when it cut its forecasted profits for the year by 40 percent and lowered its sales target for four different electronic products: TVs, PCs, digital cameras, and video cameras.

Hirai has been aggressive in his assumption of the position of CEO in April of 2012: just a week after Sony’s earnings results came out, Hirai replaced the company’s chief strategy officer. He’s also pushed the company to cut costs, slashing much of the company’s TV business while focusing on higher-end 4K TV models that are capable of generating higher margins.

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