Sony is paying just over one billion euros to buy out its Swedish partner in the mobile phone handset joint venture Sony Ericsson.
With the deal the Japanese group is looking to better integrate all its products.
“We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment,” Sony’s chairman and Chief Executive Sir Howard Stringer said in a statement.
The hope is to catch up with companies such as Apple and Samsung.
Until now Sony’s tablets, games and other consumer electronics devices have been kept separate from the phones sold and created by Sony Ericsson.
“Since television sales are set to fall, smartphones look to become more important products for Sony since their sales are rising globally and they will probably become the main device people use to connect to the Internet,” said analyst Nobuo Kurahashi of Mizuho Investors’ Securities in Tokyo.
Smartphone sales have been surging since Apple rolled out its first iPhone in 2007 and despite a slowdown in the overall consumer electronics market the fast-growing demand for smartphones is expected to continue.
Pete Cunningham of industry consultancy Canalys said: “Sony now has all the components to compete with Samsung and Apple. The big question now is can it execute? Based on history I am sceptical but I would not say it cannot be done.”
Ericsson will now focus on its mobile phone network equipment business. Its shares rose as the deal was announced.