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Thu 1 Sep 2011 03:44 PM

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Sony joins tablet fight but faces tough sell on price

Sony device late to the market, fails to impress critics on cost and quality

Sony joins tablet fight but faces tough sell on price
Sonys S and P devices are the Japanese firms first stab at the competitive tablet market

Sony's new tablet computers failed to excite gadget
reviewers and analysts who criticized the pricing and quality of the devices,
underscoring the battle Sony faces regaining its consumer electronics crown.

Sony is already late to the game with its first tablet,
which hits stores this month, more than a year-and-a-half after Apple launched
the blockbuster iPad and almost a year since Samsung Electronics Co came out
with the GalaxyTab.

Samsung's Galaxy occupies the No.2 slot in tablets that Sony
is targeting.

Reviewers and analysts highlighted a high price and features
that suggested Sony would remain an also-ran rather than a leader in the tablet
market. Two versions of Sony's main tablet cost $499 and $599, the same price
as two lower-end Apple iPad models.

"Consumers want tablets, but they are not prepared to
pay the same amount they'd pay for an iPad for something that's not an
iPad," said Gartner analyst Carolina Milanesi. "Despite the brand and
different design, with its pricing so close to the iPad, it will be challenging
for Sony."

Once a symbol of Japan's high-tech might, the maker of the
Walkman and PlayStation gaming console is struggling under the weight of its
money-losing TV division and badly needs the boost of a hit product.

"Sony really must be in the tablet market and must
succeed," said Mito Securities electronics analyst Keita Wakabayashi.

Worldwide tablet shipments are forecast to more than triple
this year to 60 million tablets and then rise to 275.3 million units by 2015,
according to a report this month from research firm IHS iSuppli.

Sony's new tablets run on Google's Android software, like
the GalaxyTab and many other tablets from Acer, Asustek Computer and Motorola
Mobility Holdings.

It is trying to distinguish its tablets from other Android
players with features such as having one model function as a universal remote,
while another folds like a clamshell and offers access to some first generation
PlayStation games.

Backed by a disco beat during an event in Berlin to unveil
the devices on Wednesday, Sony CEO Howard Stringer brushed off concerns the
company waited too long to get into the tablet market.

"We want to prove it's not who makes it first that
counts but who makes it better," Stringer said.

Based on the initial reception, Sony has failed in that
regard.

Tech reviewers credited Sony for coming up with a unique
curvy design for the S tablet, which resembles a folded-back magazine and makes
it easier to hold with one hand, but the quality of the hardware was
questioned.

A review on the Gizmodo tech blog called the tablet
"extremely plasticky" and said its screen scratched more easily than
other tablets.

Sony vowed in January to become the world's No. 2 tablet
maker - behind Apple - by 2012 and Sony executives stuck to that ambitious
claim ahead of the tablet launch.

But research firm Forrester put out a blog post saying Sony's
pricing "raises a red flag."

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At a low-key Japanese launch of the tablets in Tokyo on
Thursday, Sony hinted it could be flexible on pricing.

"We'll see and study how the market will react and
we'll take any necessary action," said Hideyuki Furumi, deputy president
of the Sony division in charge of the new tablets.

"But then again, we don't want to do competition simply
on prices, because we have a lot of differentiation points," he added,
saying the entertainment features would be expanded over time.

One expert who has played with the single-screen "Sony
Tablet: S" also was doubtful it could compete with rivals that sell high-end
tablets at the same price.

Tim Stevens, editor-in-chief of the Engadget tech blog, said
the tablet's hardware was underwhelming and its feel and design trailed the
iPad 2 and the Galaxy Tab.

"I honestly don't think this is going to be the tablet
that really catapults Sony into the lead on the Android front, which is where
it needs to be if it wants to be No. 2 in the tablet market," Stevens
said.

Sony joins a slew of technology companies hoping to win a
share in a market where many have stumbled in pursuit of Apple.

Hewlett Packard's Co decision to drop its Touchpad tablet
only weeks after it came out shows how easy it is to fail. Sales soared only
after HP slashed the price to $99 from $399 and $499, prompting the company to
announce a further "final run" of the tablets to meet demand.

Sony said the S tablet is unique because of a universal
remote inside the computer that can be used to control stereos, cable
television boxes and TV sets.

The wifi-only device has a 9.4 inch screen, weighs 1.33lbs and
has front and rear cameras.

A 16 gigabyte version of the tablet will cost $499 in the
United States, while the 32 GB version will retail for $599. In Europe, the S
will cost 479 euros. It can be pre-ordered on Wednesday and will be in stores
in September.

Sony's second tablet, the P, comes with 4 GB of memory and
looks like a clutch purse. It has two 5.5-inch screens that can be folded
together and weighs less than a pound.

The tablet also offers 4G cellular service. In Europe, the P
will cost 599 euros and be out in November. Sony said it would be in stores in
the United States later this year, but did not provide a date or price.

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