Despite its global chief executive, Howard Stringer, praising PS3 sales in Europe this week, Sony?s European head, David Reeves, is going to be issuing his 1,900 European employees with 160 redundancy warnings on Wednesday.
Speaking to The Financial Times
, Stringer was bullish about the PlayStation 3?s European launch, ??the first two days in the UK, 100 million pounds revenue changed hands and that's probably the largest consumer electronics sale in history?.
The Welshman also pointed out that his European operation ?lived up to the expectations in Europe in a way that perhaps we didn't in Japan?.
Therefore, it must have come as somewhat of a shock to Sony Computer Entertainment Europe (SCEE) staff gathered in meetings yesterday to listen to the following letter from Reeves:
"SCEE has successfully faced a number of challenges throughout its history to become a leader of the videogame industry. However our industry is in the middle of a transition where some of the fundamentals of our business are changing.
"In order to further our market leadership we sometimes have to make difficult business decisions. The management of the company has concluded that we need to change our structure, streamline and strengthen our business operations - and that our cost base needs to be significantly reduced.
"In order to achieve the necessary cost reductions it is possible that there will be up to 160 redundancies in total across SCEE offices in the UK, WWS (World Wide Studios) in Europe and in the Territories."
Despite attempts to assure what must now be demoralised staff members that, ?these are proposals only at this stage?, the announcement also includes the ominous line, ?However, the business targets that we face have regrettably made it unavoidable". This is something of a contradiction, and merely highlights the mixed messages and communication difficulties suffered by the company in recent times.
Close of business on Wednesday will see letters sent to relevant members of staff who are ?threatened? by redundancy.
SPOnG has contacted SCEE this morning for further comment and we are awaiting the response.
Whatever the response ? which is bound to be framed at the head office in Japan - it is a huge disappointment that on one hand Sony?s global boss can speak about ?probably the largest consumer electronics sale in history? in the UK and Europe, and within days the people who largely made this possible ? ahead of Japan and the United States ? should bear the brunt of a restructure.
We are keen to understand exactly what kind of ?transition? will affect the fundamentals of Sony?s computer entertainment division, as right now this appears to be code for ?cost cutting?.