Sony has struggled financially in recent years, with its shrinking share of the TV market and a sector-wide slump in PC sales dragging the company down. With the electronics business floundering, management is looking to other sectors to prop up the business and thinks it has found the next growth engine--genomics.
The Japanese business ($SNE) is entering the sector by setting up a company called P5. It's collaborating with Illumina ($ILMN) and health IT company M3, which Sony itself helped establish in 2000. Illumina will have a minority stake in the venture. As well as owning part of the business, Illumina will provide the genome sequencing equipment Sony hopes will reshape medicine and drug research in Japan. When it is established next month the new company will begin offering genome analysis services to Japanese research institutes and business.
A second strand of the business will focus on combining genome data with other sources of medical information to boost research. The U.K. and U.S. healthcare network Geisinger Health Systems is also working to enhance medical records with genomics data, but Sony has a chance to take the lead in Japan. If successful, P5 would be an important part of Sony's nascent medical unit. "We are positioning the medical business as one of our key growth pillars," Sony EVP Tadashi Saito said in a statement.
For Illumina, the deal continues its attempts to take total control of the sequencing sector. It is a partner in the aforementioned U.K. genomics project and recently revamped its product line in a bid to boost its dominance of low-, mid- and high-throughput sequencing. Illumina sees the markets in which it operates being worth $20 billion in the future, a prediction Wells Fargo analyst Tim Evans called "likely realistic, if not a bit conservative."
- read the Sony press release
- check out The Verge's take