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WSJ: 'Renegade' Kutaragi A 'Stumbling Block' For Sony CEO

A new Wall Street Journal report documenting the rise of Sony CEO Howard Stringer has highlighted tensions between the CEO and the 'renegade' head of the company's PlayStation group, Ken Kutaragi.
A new report documenting the rise of Sony CEO Howard Stringer has highlighted tensions between the CEO and the 'renegade' head of the company's PlayStation group, Ken Kutaragi. Described as a 'stumbling block' to Stringer's success, the Wall Street Journal report says Kutaragi was "notorious within the company for his reluctance to communicate with his bosses or other units," especially Sony's electronics division, which provided the parts for Sony's PlayStation products, who were not invited to the 2005 US launch of the PSP. During the development of the PlayStation 3, the Journal says that Stringer was never informed by Kutaragi of ballooning development costs taking the project over budget, and requests by Stringer for Kutaragi to meet with the electronics division heads over dinner were taken up only once a year. Further underscoring the tensions between the two groups, the Journal notes Kutaragi's blaming of the electronics group for the decreased shipments and delayed launch date of the PS3 due to a lack of blue laser diodes, saying, "If we're asked whether Sony's quality of manufacturing has declined, I would have to say 'yes.'" "I've had dinner with [Mr. Kutaragi] more times than I've had dinner with my wife, and that's not really healthy," Stringer told the Journal, explaining his attempts to cooperate with the SCEI chief. However, Kutaragi and Stringer also butted heads concerning the price of the PlayStation 3, says the Wall Street Journal, when at a board meeting, Kutaragi made a surprise announcement that the company should drop the Japanese price of the console by 20 percent to just under 50,000 yen. Said Stringer, "It wasn't financially one of my best moments. The budget implications were self-evident. [But] I agreed because I wanted the launch to be successful." The Journal concluded that that cut will double Sony's game group losses to about $2 billion for the year, though Stringer told the newspaper, "I think it's fair to say that any time you're aiming for the stars, you're running the risk of falling a bit short on your timetable."

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