Howard Stringer, Sony’s chief executive, seems to have come to the same conclusion as me about his company’s struggles to create a series of proprietary formats that other electronics companies have to follow. This is what he had to say about the approach in the Financial Times last week:

We made a decision to make something proprietary and it sent the signal to the world that Sony was trying to own something. That decision was the wrong decision … it’s stupid for us to be arrogant and say we’re going to build a closed system especially when the competitors – Microsoft and Apple – are very strong. We’ve given up on the idea that [proprietary formats] is how we will make our money.

Sir Howard was talking about Sony’s efforts to promote its Atrac format for digital music files, which was an attempt to create a completely closed platform. The idea was that you would only be able to play digital music files encoded in Atrac on a Sony Walkman so that Sony would not only manufacture the device but control the content.

We know where that got it: the Walkman brand was replaced by Apple’s iPod. Steve Jobs, Apple’s chief executive, made the smarter decision to allow MP3 files (many of them illegally copied) to be played on iPods as well as those coded in Apple’s AAC format.

But Sir Howard has clearly drawn a wider lesson from it. It seems to me that it applies equally to Blu-Ray, the high-definition video disc standard that I discussed the other day.

You could argue that Blu-Ray was never intended as a proprietary format. Having developed the technology, Sony enlisted others to market and license it as a standard. But I still think that Sony ought to be wary of starting a similar campaign again. It seems that Sir Howard may agree.

January 21st, 2008 in Technology | Permalink