A decade after pulling the plug on its humanoid and doggy robots, Qrio and Aibo, Sony is making a new bet on intelligent machines in an effort to reboot its once-iconic consumer electronics.

But Kazuo Hirai, Sony’s chief executive, says the move is not a nostalgic return to the old days as Japan’s gadget king. Having only emerged from a phase of restructuring that saw its laptop business go, Sony is banking on the robotics business as a gateway not only into homes, but also into factories, warehouses and companies.

“It’s not about us getting back into the Aibo business. It’s us dipping our feet into a bigger area of new electronics in artificial intelligence and robotics,” Mr Hirai says in an interview.

Despite being a pioneer in developing consumer robots with the launch of Aibo in 1999, a prolonged period of losses and cost-cutting saw Sony’s robotics business killed off in 2006.

A string of disenchanted engineers left the Japanese electronics and entertainment group as its Bravia televisions, the Walkman music player and Xperia smartphones lost their shine with the rise of Samsung and Apple.

With the company turning profitable from last year, Mr Hirai says it is time to shift gears and rediscover its connection with consumers.

“We’ve done the real hard restructuring in the first three years. Now it’s time to innovate and really step on the gas,” he says.

Advances in deep learning — a form of AI that tries to mimic the function of layers of neurons in the human brain — have sparked a fierce race in robotics and smart machines led by Google and Amazon.

In Japan, Toyota is investing $1bn in AI research while Honda and Panasonic are developing robots to help people with disabilities and the elderly.

Fanuc, a leader in industrial robots, is tapping into AI to connect its factory machines worldwide. In the consumer space, SoftBank is offering Pepper, a companion robot that entertains people by talking and responding to their emotions.

For Sony, its AI research dates back to Aibo’s development, but analysts say its historical competitive edge is dwarfed by the massive talent pool and investment capital the US technology groups have.

“Sony needs to do something drastic such as selling off its smartphone business to focus on robotics in order to capture future growth opportunity,” said Hiroyasu Nishikawa, analyst at Iwai Cosmo Securities.

Mr Hirai said the company has capital to hire outside experts in addition to its own engineers and researchers. In May, Sony spent an undisclosed amount in a US start-up specialising in AI called Cogitai, and it will set up a ¥10bn ($97m) fund to invest in outside researchers and companies working on AI and robotics.

“We’ll do what’s necessary to make sure that we bring the right product to the market,” Mr Hirai added.

He declined to elaborate on what kind of robot Sony is working on and on whether the usage is for companionship or human support.

The robotics venture comes as Sony is wrestling to stem losses from image sensors used in Apple’s iPhones. The business, which is core to Sony alongside PlayStation games, has suffered from a slowdown in the smartphone market and damages from twin earthquakes on the southern island of Kyushu earlier this year.

Mr Hirai said the adoption of dual lens camera, which analysts say will probably be used in Apple’s new iPhone 7 in September, could be one of the factors to drive the turnround of its image sensor business.

Britain’s recent vote to leave the EU has also led to an export-denting surge in the yen, while raising questions for Sony’s sales, treasuries and manufacturing operations in Britain where it employs more than 5,000 employees.

“Right now, it’s kind of difficult to even come up with a contingency plan,” Mr Hirai said. “We don’t know what the situation really is so we want to make sure the employees are not having a knee-jerk reaction.”


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Source: https://next.ft.com/content/3003b0d2-3f5e-11e6-9f2c-36b487ebd80a

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