Sony Ericsson - Joint Venture

Sony Ericsson is a joint venture established on October 1, 2001 by the Japanese consumer
electronics company Sony Corporation and the Swedish telecommunications company Ericsson
to make mobile phones. The stated reason for this venture is to combine Sony's consumer
electronics expertise with Ericsson's technological leadership in the communications sector. Both
companies have stopped making their own mobile phones.
Troubles in Ericsson's mobile phone business
In the United States, Ericsson partnered with General Electric in the early 90's, primarily to
establish a US presence and brand recognition. Ericsson had decided to obtain chips for its
phones from a single sourcea Philips facility in New Mexico. In March 2000, a fire at the
Philips factory contaminated the sterile facility. Philips assured Ericsson and Nokia (their other
major customer) that production would be delayed for no more than a week. When it became
clear that production would actually be compromised for months, Ericsson was faced with a
serious shortage. Nokia had already begun to obtain parts from alternative sources, but Ericsson's
position was much worse as production of current models and the launch of new ones was held
up. Ericsson, which had been in the cellular phone market for decades, was struggling with huge
losses. This was mainly due to this fire and its inability to produce cheaper phones like Nokia.
Sony on the other hand was a marginal player in the worldwide cell phone market with a share of
less than 1 percent in 2000. Despite sustaining losses in this area, it wanted to focus on it more.
In April 2001, Sony confirmed that it was in talks with Ericsson for a possible collaboration in
the handset business. By August 2001, the two companies had finalized the terms of the merger
announced in April.
In spite of having aimed to be profitable in its very first year, Ericsson's market share actually
fell and in August 2002, Ericsson said it would stop making mobile phones and end its
partnership with Sony if the business continued to disappoint, even as Sony said it was fully
committed to the joint venture and wanted to make it a success. However, in January 2003, both
companies said they would inject more money into the joint venture in a bid to stem the losses.
Sony Ericsson's strategy was to release new models capable of digital photography as well as
other multimedia capabilities such as downloading and viewing video clips and personal
information management capabilities. To this end, it released several new models which had
built-in digital camera and color screen which were novelties at that time.
On October 27, 2011, Sony announced that it would acquire Ericsson's stake in Sony Ericsson
for 1.05 billion ($1.47 billion), making the mobile handset business a wholly owned subsidiary
of Sony. The transaction's completion was expected to occur in January 2012. At their keynote
at the 2012 Consumer Electronics Show, Sony's Kaz Hirai announced that Sony Ericsson would

be known simply as Sony Mobile Communications pending completion of the transaction. On

January 26, 2012, the European Union approved the buyout. On February 16, 2012, Sony
announced it had completed the full acquisition of Sony Ericsson. On January 7, 2013, Sony
Mobile completed moving its headquarters from Lund, Sweden to Tokyo, Japan in order to fully
integrate with its parent company.
The two companies were compatible partners for the joint venture. Since joining forces, both
have stopped producing their own mobile phones. Sony was a major electronics brand with
expertise in the industry, and Ericsson was a leading company in the communications sector.
Sony could enter the mobile phone market on a leading companys coattails, and Ericsson could
stay on the cutting edge with the newest technologies from Sony. Sony's main motivations for
the Joint Venture were based on strategic factors: seeking Ericsson's excellent
telecommunications technology and its technical wireless expertise and market share, in order to
compete with the market leader, Nokia Corp. On the other hand, Ericsson's aim was towards the
acceleration of the companies' financial and technological stance, with an ultimate aim to
produce consumer electronics that would rival Nokia's stronghold on the telecommunications
industry. The combination of the two companies, sharing a common aim, would allow Sony
Ericsson to present a range of products that were far more technologically innovative than
anything available during that time. For Ericsson, the benefits of the merge were significant.
Sony had access to the closed Japanese market, as well as its know-how in entertainment
technology and design would complement Ericsson's mobile platform and state of the art mobile
technology. Ericsson would also have access to Sony's design and production processes.
Furthermore, the imaging, music, audio and video entertainment advantages that Sony held
would enable the production of new, innovative entertainment handsets, entering an untouched
market.
As Ericsson held nearly four times Sony's share in the industry, and compared to Ericsson,
Sony's presence in the European market was relatively weak a partnership with Swedish Ericsson
could be seen as a way to achieve growth in new regions. Perhaps the biggest problem for
Ericsson was that while they produced well functioning, high quality phones, they were unable to
sell them well because they didn't cater to the tastes of consumers. Contrarily, Sony was failing
to compete in the mobile phone market but was naturally able to sell its other products. The
combination of the two proved to be a very successful venture.

Burger King - Franchising

The majority of the locations of international fast-food restaurant chain Burger King are
privately owned franchises. While the majority of franchisees are smaller operations, several
have grown into major corporations in their own right. Since its predecessor's inception in 1953,
Burger King has used several variations of franchising to expand its operations. In the United
States, the company originally relied on a regional franchise model with owners having exclusive
expansion rights in a defined geographic territory. This model proved to be problematic as it led
to issues of food quality, procedures and image management. A 1970s attempt by one of its
largest franchises to take over the chain led to a restructuring of its franchising system, tossing
the old method in favor of a restricted, per store licensing model. The 1978 restructuring, led by
a new director of operations, firmly placed the mantel of franchise oversight on the shoulders of
the company.
While Burger King still utilizes a version of its revamped franchising system in the United
States, outside of North America its international locations licenses are still sold on a regional
basis with franchises owning exclusive development rights for the region or country. These
regional franchises are known as master franchises are responsible for opening new restaurants,
licensing new third party operators, and performing standards oversight of all restaurant
locations in these countries.
Burger King has more than 11,000 restaurants globally in more than 60 countries. This
impressive growth relies on the success of their franchisees and that is why Burger Kings
market plan focuses on restaurant-level economics. Burger King continues to create franchise
opportunities around the globe in both new key markets where other Burger King restaurants
have already proven themselves.