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US Department of Justice investigates Sony over battery business

Alleged anti-competitive practices
Wed Jun 29 2011, 12:49

THE US DEPARTMENT OF JUSTICE (DoJ) is investigating the US wing of Japanese electronics firm Sony over alleged anti-competitive practices in its rechargeable battery division.

The DoJ requested that Sony hand over information regarding its battery business in early May, according to Keita Sanekata, PR manager at Sony, who added that Sony is cooperating with the investigation.

While the full scope of the investigation is unclear, and Sony is reluctant to share too many details, it most likely focuses on pricing and distribution deals that make manufacturers favour Sony batteries over those of rival companies.

In 2010 many of the big battery makers, including Sony, cut prices when they discovered there was an oversupply on the market, according to the Institute of Information Technology in Tokyo. This could be part of the focus of the investigations by the DoJ, as low prices or 'dumping' of products by the dominant players might have forced the smaller companies out of business.

If found guilty of unfair competition practices Sony could be forced to alter its battery business and potentially might have to pay a hefty fine, which it certainly doesn't need after the heavy losses it incurred during its recent hacking fiasco.

Sony previously got into hot water over its batteries in 2006 when they started exploding in Dell laptops, luckily not while on someone's lap. It was forced to recall several million of these batteries after Japanese consumer safety authorities got involved. The overheating battery problem resurfaced in 2008, causing further alarm among HP, Dell and Toshiba laptop users.

The rechargeable battery business is set to boom big time over the next few years, according to Bloomberg, thanks to growth in sales of electric and hybrid cars. Current sales are minimal, but they are expected to jump to $21 billion by 2020, so it's not surprising that Sony is investing in this area. µ

 

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