Tech Transformers

Has Sony got its groove back?

Is there a future for the tablet?

Sony has shown a "return to form" in its devices, business analysts told CNBC, after the Japanese electronics giant unveiled a slim tablet and mid-range smartphone on Monday.

A 299 euro ($339) smartphone known as the Xperia M4 Aqua was shown off at Mobile World Congress (MWC) in Barcelona, as Sony looks to target the mid-range market which has seen solid growth as customers look for high-end devices at low prices.

The M4 Aqua looks similar to Sony's flagship and more expensive Xperia Z3 which was unveiled last year, and has many of the same features, including being waterproof. It also has a 13 megapixel rear camera and 5 megapixel front camera.

Sony also revealed the 6.1 millimeter thin Xperia Z4 tablet with a 10.1 inch screen, touting the device as ideal for both business use and entertainment.


Analysts said the Japanese conglomerate had brought out appealing devices but still faced some major challenges.

"It was real return to form for Sony," Ben Wood, chief of research at CCS Insight, told CNBC by phone.

"The challenge is that the overall market is so competitive and it's really is difficult to standout. You have Apple that dominate premium, Samsung now have a point to prove and have come out big."

Smartphone exit?

Question marks have been raised over the future of Sony's smartphone business as the Japanese giant continues on its massive restructuring project that has led to its personal computer arm and TV division being spun off .

In September, CEO Kazuo Hirai told CNBC that Sony needed to remain in the smartphone business, but at a briefing earlier this month, he said he would not "rule out considering an exit strategy" from the smartphone and TV business.

The smartphone division is one the least profitable in Sony and brought in just 9.3 billion yen ($7.8 million) in the third quarter of the 2014 fiscal year, according to company reports, as it struggles against the likes of Apple in the premium segment and lower-cost players.

But analysts are convinced that Sony will not exit the smartphone business as it's a way for the company to tap the consumer market and reach a large audience.

"Sony need to be in the handset business if they wish to be a consumer devices company. If they withdrew from handsets, it would be the first step of pulling out of consumer devices," Ian Fogg, head of mobile at IHS, told CNBC by phone.

Low prices key

Apple has been one of big smartphone winners of 2014 and their success has come from keeping users in their ecosystem through services such as Apple Pay or the iTunes store. Sony has been attempting to replicate the strategy by tying in aspects of PlayStation gaming into their smartphone and the "Xperia Lounge" service which offers users discounts on products, content, as well as competitions.

Sony's MWC M4 Aqua release highlights the company's attempt to target the hot mid-priced market and analysts said the Japanese company will continue down this route.

"It looks a premium device at a much lower price point and that is the type of deice that Sony needs to show," Francisco Jeronimo, research director for European mobile devices at IDC, told CNBC by phone.