Sony buys out Ericsson from mobile partnership for €1.05bn

Sony is to buy out Ericsson's 50 per cent stake in the firms' joint mobile phone venture for €1.05bn, and will launch a dedicated assault on the smartphone market.

The companies have collaborated on a series of Android smartphones since 2001, but have struggled to make an impact as rivals Samsung, HTC and Apple took huge swathes of the market, giving rise to rumours of a buyout earlier this month.

Sony chief executive Howard Stringer explained that the move will help the firm to align future products into one brand and entice more consumers to its offerings.

"With a vibrant smartphone business and by gaining access to important strategic intellectual property, notably a broad cross-licence agreement, our four-screen strategy is in place," he said.

"We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that connect with one another and open up new worlds of online entertainment."

Gartner research analyst Carolina Milanesi told V3 that the deal makes sense for Sony as it will allow the company to forge its own brand in the smartphone market. She added that Sony may even ditch Android for Windows Phone 7, or buy webOS from HP.

"Sony is in a much better place to make the most of webOS as it already owns access to lots of content it could run over the platform, but if it sticks with Android it could find it hard to differentiate itself in the market," she said.

"Sony wants to become like Apple and 'own the living room' with its devices, so by bringing the devices under its sole control it can design and market them as it wishes, without having to fight with Ericsson."

The deal is due to close at the end of January, subject to standard regulatory approvals.