Shulou(Shulou.com)11/24 Report--

Original title: "contend for the fourth screen"

Sony, which started as a consumer electronics, is desperate on the road to building cars.

Sony Honda Mobility (SHM), an electric vehicle joint venture between Honda and Sony, unveiled the Afeela brand and launched a prototype at the 2023 Consumer Electronics Show (CES) on January 6.

Unlike the familiar launch of new cars, Afeela ignores key information such as the mileage and number of motors of the prototype, and makes the in-car entertainment experience the biggest attraction of the whole event.

It is reported that Afeela aims to integrate the real world and the virtual world, turning mobile space into entertainment space.

According to the official video, the Afeela prototype is equipped with a big screen for all seats. Users can not only watch videos and listen to music, but also play host games such as Horizon and Marvel Spider-Man.

No wonder some people tease that for Sony, which is known as the "first new force in building cars in Japan", putting the PS5 on the car seems to be its biggest pursuit.

The Trilon TV, the Walkman Walkman, the PlayStation game console and the Discman D50 Walkman have four seats in time magazine's list of the "50 greatest electronic products of all time".

It was famous for the popularity of consumer electronics, and it declined because it missed the revolutionary opportunities of the digital and Internet age. Today, cars are becoming Sony's next key battlefield.

Around this topic, this article is devoted to answering three questions:

1. Why did Sony build a car?

2. What is the biggest advantage of Sony car building?

3. Can the in-car entertainment experience move consumers?

1. From robot AIBO to car, the idea of Sony car comes from robot AIBO.

Based on the exploration of artificial intelligence technology, Sony launched the solid dog-shaped robot AIBO in 1999, which was the first to enter the field of entertainment robot.

AIBO is shaped like a pet dog and can use artificial intelligence to learn and interact with its owner and environment. In Japan, the AIBO sold about 150000, making it a star product at the time.

At the beginning of the 21st century, Sony's situation took a sharp turn for the worse. Missing out on the Internet era, Sony's core consumer electronics business is also in trouble because of a price war with emerging rivals. Sony had to stop the AIBO project in 2006 because of deteriorating business conditions.

However, Sony has not given up on the dream of AIBO. The creator of AIBO, president of Sony computer Science Lab and CEO Hiroaki Kitano has revealed that from the beginning, AIBO was more than just intelligent robot hardware.

Sony hopes to build AIBO into a platform that provides more AI applications and software and makes money through software updates and paid subscriptions.

As corporate conditions improve, Sony believes that the first thing to do is to bring AIBO "back to life" if it is to return to AI and robotics.

As a result, the Sony artificial intelligence robot project was restarted in 2016. In 2017, Koizumi Kawanishi, then managing director of Sony, began to serve concurrently as the leader of the robot business of career development platform AI, leading the development of AIBO.

It was in that year that Sony's vice president and chief financial officer had their first discussion between Hiroki and Kawanishi at 10:00 on whether Sony should build a car.

At a meeting within Sony, at 10:00 Yuki asked Kawanishi: "what do you think is the nature of the once-in-a-century change in the automotive industry?"

Kawanishi, who is pushing ahead with the AIBO project, naturally associates with more possibilities of software in the automotive field. He believes that the future of cars, like artificial intelligence robots, should be an innovative combination of mobility and software.

"when the structure of a car is changed from machinery to electrical appliances, it needs to be controlled by software. and isn't that Sony's advantage?" Kawanishi said.

Mr. Kawanishi later recalled that the conversation with 10:00 Yuki planted a seed for Sony to build a car.

2. Changing the value of cars from mobile to entertainment within Sony, car building is a highly controversial topic.

With years of accumulation in areas such as CMOS image sensors and audio, Sony entered the auto parts market such as on-board sensors in 2014, but Sony executives have been hesitant to build cars.

At the 2020 CES show, Sony unveiled its prototype electric car, the Vision S. Sony claimed that the launch of the Vision S is only to show "the application of Sony technology in the automotive industry", publicly refuting the rumors of car construction.

Behind this simple "refutation of rumors", there has been a very heated debate within Sony.

Sony executives believe that the car safety requirements are extremely high, and is a heavy asset model, so no decision has been made. "the performance of the image sensor has been praised by the market, but Sony lacks automotive knowledge." Sony Group Chairman, President and Chief Executive Officer Kenichiro Yoshida said.

What let Sony change the decision of "not building cars" is the spring tide of intelligent and electrified cars that is rarely seen in a century.

At present, the car has developed from a simple means of transportation to one of the most commercially valuable mobile terminals, and the car is becoming the "fourth screen" after TV, computer and mobile phone.

Whether it is the front-loading market or the rear-loading service market, whether it is car factories, parts companies, car networking companies, or technology giants and new technology companies such as Google and Apple, which are looking covetously to enter the automobile industry, they are all making a layout for the interconnection and intelligence of cars.

This "fourth screen" is the next important carrier that can carry many businesses of Sony.

Sony is one of the world's largest manufacturers of electronic products, one of the three giants in the world's video game industry, and one of the six major Hollywood studios in the United States. At Sony, which has multiple businesses, the fragmentation between departments has always been seen as an unresolved issue.

In this regard, Kenichiro Yoshida advocated to "share a pot of rice" and promote cooperation between different businesses. "Sony's music, games and movies were originally three independent entertainment businesses, but in the future, they will be developed together."

Deepen the linkage between games and concerts and adapt popular games into movies on the big screen. In recent years, Sony has made a variety of attempts on business integration.

With the advent of the era of self-driving, cars will change from a cold machine that provides the function of moving from A to B to a "private space" for people to travel. Sony found that this would be an excellent opportunity to integrate multiple entertainment businesses, that is, to "apply the user experience provided by Sony to cars".

If you look at it from this point of view, the meaning behind Sony's car building is clear.

It is often said that Sony is a "creative entertainment company based on solid technology". On the one hand, as an important fourth screen in people's lives in the future, smart cars can become an integrated display window of Sony Entertainment content and broaden the operation channels for Sony Entertainment business.

On the other hand, like Play Station or AIBO, through paid subscriptions, Sony is able to constantly reach users through updates to entertainment content and charge users for subscriptions. This not only enhances the user experience, but also brings stable benefits.

"the trend of the past 10 years is smartphones, so there will be migration in the future, and we will change the value of cars from mobile to entertainment." Kenichiro Yoshida said.

3. After focusing on the value of software, the story of Sony car building is known to more people.

In January 2022, at the CES2022 Consumer Electronics Show in Las Vegas, Kenichiro Yoshida announced that Sony Group would set up Sony Mobile (Sony Mobility Inc) to commercialize its electric vehicles.

It is worth mentioning that paid software subscription is a key part of this business plan.

Sony plans to continue to generate revenue from car sales through services such as software and content updates, with a subscription fee model similar to that of AIBO robots.

"Sony envisions a long-term relationship with users in the mobile travel business, such as PlayStation or AIBO," Mr Kawanishi said. "Electric cars themselves can reach users through a subscription model, and Sony will continue to charge users a subscription fee based on software updates that improve content and functionality."

Just five months later, Sony announced a 50 per cent stake in Sony Honda Mobility, a joint venture with Honda. Honda will be responsible for the production of Sony cars, while Sony will be responsible for the development of a series of intelligence-related technologies, such as smart driving and intelligent cockpits.

At the 2023 Consumer Electronics Show (CES) on January 6, Sony Honda Mobility unveiled the Afeela brand and launched a prototype car. It is reported that the model is scheduled to open for booking in the first half of 2025, and the first batch of cars is expected to be delivered to North American customers in the spring of 2026.

In addition to the system-level chip of Qualcomm Snapdragon digital chassis, the ECU with the maximum processing power of 800 TOPS, and 45 cameras and sensors, the new model's exploration of entertainment functions is even more eye-catching.

On the mobile operating system, Afeela has launched a brand new human-computer interaction system (HMI), which provides personalized in-car experience through cloud service connections, and explores new entertainment possibilities through digital innovations such as meta-universe, turning mobile travel space into entertainment and moving space to achieve entertainment experience other than driving.

4. Can the in-car entertainment experience move consumers? In fact, Sony is not the first "crab eater" in the field of car entertainment. From the original cassette player to the CD player, and then to the streaming media player, car entertainment has always been the focus of car companies.

With the advent of the era of "data determines experience, software-defined car", in-vehicle computing, artificial intelligence and intelligent networking are accelerating, which brings new possibilities for cars to achieve a higher level of vehicle automation, safety, convenience and driving fun, and brings the in-car entertainment experience into a period of accelerated change.

According to ICVTank, a cutting-edge science and technology consulting company, China's intelligent cockpit market will reach 103 billion yuan by 2025, of which in-vehicle infotainment systems will account for 46.4 percent of the market.

As early as 2019, Tesla launched the in-car game platform Tesla Arcade, which allows users to access a variety of Atari games through the central control of the car, and operate the games through the virtual control on the screen or the steering wheel and brakes.

In December 2022, Tesla further opened the entertainment function and announced support for the Steam game platform. By installing the client, car owners can get a lot of games from it.

Recently, Nvidia also announced that cloud gaming services will be launched on the car platform, and the first batch of car brands to support BYD, Hyundai, Kia, Genisse and so on. It is understood that the service will provide more than 1000 games.

Especially after the fully autopilot becomes a reality, the mobile space property of the car becomes more and more prominent. Smart cars will become mobile smart terminals, giving rise to immersive Internet entertainment experiences such as social networking, music, video, games, consumption, AR and VR applications, and evolve into the second largest Internet ecology and service integration platform.

Just as the emergence and popularity of smart phones detonate the mobile Internet economy and the smart home market, in-car service ecology is expected to burst into a huge market potential.

There is no denying that the upgrade of in-car entertainment experience is the trend of the times, but there are still many challenges for Sony to build cars.

According to the Global Automotive Consumer Research 2022 released by Deloitte, the price, mileage and energy supplement system of electric vehicles are among the top factors that affect consumers' choice of electric vehicles. Although Sony has produced a wide variety of products in the past, building cars is still a challenging systematic project.

At the same time, at present, L4 autopilot faces difficulties in technology, regulatory standards, supply chain and other aspects, and the speed of commercial landing is quite different from people's early optimistic expectations. If high-level autopilot is slow to land, it will pose a challenge to the underlying logic of Sony cars.

Therefore, in this automobile intelligent reform, who can better find a balance between technology, scale and cost, who is more likely to go further in this automobile intelligent reform.

For Sony, it doesn't happen overnight to win over consumers by relying solely on the in-car entertainment experience. At the same time of forging the long plate, how Sony makes up the deficiency of the car is the key factor that determines how far the Sony car can go.

[full text reference]

[1] "Dialogue with the Father of Sony Robot Dog: why is AIBO a robot dog and not a robot cat? Geek Park, Jingyu

[2] "Don't hit the road without games? With Tesla "grab the cake" car game function swept the CES exhibition, the financial union

[3] "the car entertainment market is full of potential. It is suggested to pay attention to high-quality content developers and content platforms", Huatai Securities.

[4] "can building cars bring Sony back to the top? ", dimensional C, North Shore

This article comes from the official account of Wechat: che Bai think Tank (ID:EV100_Plus), by Cheng Honghe.

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