Although Sony Ericsson has been in the mobile device market since 2001 and performed well in its early years, it faltered in the second half of the 2000s due to the rise of more popular smartphone providers. As a result, Sony is taking complete control of the Ericsson business by buying it out, in order to merge it with other existing operations.
According to Reuters, the company is looking to make smartphone development one of its chief priorities. It will integrate the products that Ericsson makes to be compatible with electronics items in its existing product line, including laptops, televisions and tablet computers. Nobuo Kurahashi, an analyst with Mizuho Investors' Securities in Tokyo, Japan, stated that this practice was in line with market precedents.
"Sony is looking to do the same as Apple and meet users' demands through linking various devices with similar interfaces and operating systems," Kurahashi told Reuters.
The news source reports that Sony is offering Ericsson 1.05 billion euros ($1.5 billion USD) in the purchase deal. After the arrangement was announced, shares of Ericsson's stock had risen by 5 percent in pre-noon trading.
SlashGear reported that this deal could make Sony a viable competitor against major names in the smartphone market such as LG, Samsung and Apple, and that Ericsson would begin solely producing Android-powered smartphones and smartphone accessories in 2012.