Akio Morita helped turned a small radio repair shop in post-war Tokyo into one of the largest and most successful corporations the world has ever seen. If you used to have a Walkman or are fond of your PlayStation 4 you have Akio Morita to thank for that. The Sony Corporation simply would not exist without the labors of Akio Morita. He is also, in part, responsible for helping build the current Japanese electronics industry over the last 60-70 years.
From humble beginnings in the basement of a bombed-out department store in Tokyo, Akio and his business partner would create a company that would become one of the greatest companies in the world, Sony. In little over 50 years, Sony would grow to become arguably the number 1 brand name in the world. An absolutely incredible feat.
"Our plan is to lead the public with new products rather than ask them what kind of products they want. The public does not know what is possible, but we do."-Akio Morita
Akio Morita was born on the 26th January 1921 in the Nagoya, Japan. His parents were wealthy sake, miso and soy sauce producers in the village of Kosugaya. This had been a family enterprise since 1665. He was the eldest of three sons and was expected to take over the family business when he came of age. Despite training from his father Kyuzaemon, Morita had other ideas.
"When I was in high school my father bought me an electronic phonograph. The sound was fantastic. I was so impressed, I started to wonder how and why such sound came out. That's when my interest in electronics began." - Morita would later recall.
Akio studied electronics in his spare time. He even attempted to build his very own radio, phonograph and tape recorder. Morita managed to convince his father that his younger brother should take over the business. This freed him up to enroll at Osaka Imperial University. Here he earned his bachelor's degree in physics.
When the Second World War broke out he was drafted into the Imperial Japanese Navy. Thankfully he was not enlisted for combat and was assigned to Naval Research at a Center In Susaki. Here he would meet the man who would help him change the world of electronics, Masura Ibuka.
From humble beginnings
After the Second World War, at the age of 25, Akio helped start the Tokyo Telecommunications Engineering Corporation (Tokyo Tsushin Kogyo KK) with his business partner Masura Ibuka, in 1946. At this time they only had around $375 and some floor space in an abandoned department store. The company had around 20 employees and an initial capital of 190,000 yen.
This space was in the basement of the department store as it been bombed out during the war. Here, the fledgling company successfully built Japan's first ever tape recorder. Just post-war resources were very scarce indeed. The two were required to scrounge mimeograph paper to make the tape. To create the magnetic coating they melted oxalic ferrite powder in a skillet to make ferric oxide. They then painted this onto paper strips. Although the tape sounded terrible it worked. And so it was from these humble beginnings that the giant we know today as Sony was born.
The name change came in 1958 when Morita and Ibuka decided to name their company Sony. The new name was derived from the combination of sonus (Latin for sound) and Sonny-boys (a common American expression at the time).
Other early products included vacuum tube voltmeters and amplifiers.
This first attempt at breaking into consumer electronics was not to catapult them into the limelight, just yet. It was rather big and bulky even by the standards of the day. It wasn't until the 1950's that Ibuka and Morita would start to make serious ground. They were granted a license from Bells labs to build transistors. Bell Laboratories had developed some of the first transistors in the U.S.
Sony's masterstroke was to use these transistors in radios as well as other electronic devices down the line. This allowed to them to begin their gradual ability to mass produce reliable electronics to the public.
At this time the Japanese were still recovering from the devastation of the war. Expensive electronics could not really be afforded by the general public at large. This didn't dissuade the business partners, however. Instead of concentrating on their domestic market they set their sights on trying to break into the American market. Postwar America was one of booming employment and high consumer confidence. This made people excited to buy new and exciting things.
In order to do this, they decided to design and build a small, transistor radio that could fit in the consumers pocket. Somewhat of a novelty at the time. With their first radio in hand, Morita began to try to sell their product to American distributors. The company had successfully created a pocket radio but it was still too big to fit most pockets. His salesman solved this problem by adding extra big pockets to their shirts. This enabled them to slip the radios in and out of their shirts with ease during demonstrations.
Sony's big break
Sadly for them, a U.S. company managed to build one first, but this was more of a gimmick than a genuine functional device. Morita and Ibuka soon changed their small company's name to Sony.
Eventually, a purchasing agent at the Bulova watch company saw the radio's and decided to buy 10,000 units. This was under the proviso that they carry the Bulova name. Sony, surely, could not turn this offer down, it was a huge order. So much so, in fact, that was worth more than Sony's capitalization at the time! Morita was dead set on making Sony an International brand.
Despite reservation from his partner and the Sony board he decided to turn down the generous offer from Bulova. This was to be, what he would describe as his best business decision of his career. Akio later managed to find a distributor who would sell their little radios under the Sony brand. As he had predicted American consumers loved it. This initial success led to other 'first' products from Sony. These included the 8-inch transistor television and the video tape recorder.
Sony would go on to make huge technological achievements in design, production, and marketing. These would all transform the "Made in Japan" label from being a synonym with cheap and cheerful to that of superior quality and reliability. Morita would later recall that Sony was the Cadillac of electronics.
Morita moves to America
Akio was determined to build a company presence in the United States. He wanted to make it so that Sony would dominate the landscape without appearing to be a foreign company. To this end, he moved himself and his family to New York in 1963. Morita would now personally oversee the operations of Sony Corporation of America, a legal entity created three years previously.
Morita, showing great insight once again, realized that to sell effectively to the American market he needed to 'get into the mind' of the American people. He had to learn how the lived and more about how they ticked. He would rapidly build a solid and valuable network of contacts by socializing and hosting parties during the week. This was something he would maintain throughout his working life.
Akio Morita's business sense was palpable. He had an astonishing ability to study both Western and Eastern cultures and combine the best parts of each to make a series of fabulous products. His expertise would often lead him to consult US-Japanese trade issues.
Sony became the first Japanese company to build a manufacturing plant in the United States. As the years passed, Akio would oversee the setting up of many other manufacturing, R and D and design centers across the U.S., Europe, and Asia. Morita believed, rightfully, that Sony should contribute to the economies of any country where the biggest markets were located.
Akio Morita the man
Many who met Akio attested to the fact that he was a very friendly, cheerful and outgoing man. Many would recall that he had a natural radiance and he had a talent for captivating the attention of anyone who met him. Morita had excellent communication skills and a great amount of charm. This charm allowed him to easily bridge any cultural gaps between his homeland and the West. Akio was a workaholic who also loved to sports and remained very active throughout his life. He even took up water skiing, scuba diving and windsurfing in his sixties.
Akio was very passionate about innovation. This allowed Sony to go on to develop many 'word first's in technology. These included the first successful battery-powered portable TV, the Trinitron picture tube (which would set a new standard for color TV quality) and the first color home recorder, the Betamax. Sony was also able to develop several new media standards. These included the 3.5-inch floppy drive, 8mm video tape and audio CD in a joint effort with Phillips.
Morita was determined to stay "two steps ahead of the competition" at all time. His dedication to this motto would help him and Sony develop many new products.
Some of these other industry firsts were:-
- AM transistor radio
- Pocket-sized transistor radio
- Two-band transistor radio
- FM transistor radio
- All-transistor television set
- Home-use VCR
- 8 mm video camera
The Sony Walkman
Morita using his mastery of finding a need to fill paid off when he discovered that Americans love music. They would happily listen to it in their cars and even carry large stereos to the beach and park. Also during the 1970's tape players, especially portable ones, were becoming very popular in America. Most were very big and heavy, however. Morita decided that what was needed was a high-quality sound portable playing device that consumers could listen to whilst doing something else. The device would need to be battery-powered that came with headphones so that the user had greater freedom than existing devices.
And so it was that the Sony Walkman was born. This was to become one of the company's more profitable products of all time. At the time many people in the industry believed Sony's new tape player would be a flop as it lacked a recording function. Morita knew that the device needed to lack this in order to be small and portable. Akio's insights were to prove correct. Sony’s Walkman has been one of the most successful personal electronics products ever, with over 250 million units sold since it’s debut in 1979.
The Walkman was a huge success
The Walkman would be so popular it was very difficult for competitors to replicate. It took more than two years before any other company even managed to introduce competing models. By this time they had already shifted 20 million units and the company's reputation and brand had been secured worldwide.
With Morita at the helm, Sony would continue to grow and diversify. They would become the world leader in virtually all aspects of consumer electronics ranging from televisions to CD players. 1987 saw the acquisition of CBS records for a cool $2 billion. Akio would, in 1989, just before his retirement, got the ball rolling for Sony to purchase Columbia Pictures. This made Sony a major player in the entertainment business.
Akio Morita's publications and awards
Akio was a firm believer that success at school did not necessarily guarantee success in life or business. His 1966 book Gakureki Muyō Ron (Never mind school records) epitomises this belief. In it, he argues the case that skill in business cannot be measured accurately from the existing educational systems of the time.
Morita was awarded the Albert Medal of the UK's Royal Society of Arts in 1982. He was the very first Japanese to receive this prestigious award. Two years later, Akio would also be awarded the Legion of Honour.
In 1986 Morita wrote his autobiography titled Made in Japan. He also co-authored the 1991 book The Japan that Can Say No. This 1991 collaboration with Japanese politician Shintaro Ishihara was a strong criticism of American business practices. It also firmly encouraged Japanese firms to take more independent roles in business and foreign affairs. The book was translated into English and caused controversy in the United States, and Morita later had his chapters removed from the English version and distanced himself from the book.
Also in 1991, Akio was awarded the First Class Order of the Sacred Treasure from the Emperor of Japan. He was also inducted into the British Knighthood with a KBE in 1993. Morita received the International Distinguished Entrepreneur Award from the University of Manitoba in 1987. He was posthumously awarded the Grand Cordon of the Order of the Rising Sun in 1999.
Akio Morita served as the vice chairman of the Japanese Business Federation. He was also a member of the Japanese U.S. Economic Relations Group that was also known as the "Wise Men's Group".
Ballad of the Betamax
When Akio Morita was interviewed in 1986, the host asked him what his worst business error was. After some deep consideration, he finally replied "Beta". Sony managed to pioneer the videocassette recorder with the beta format. This was a format they would stubbornly standby at a time when VHS was beginning to crowd the market. Because of this Sony's very profitable VCR sales of the 1970's and early '80's would quickly dwindle and soon became a liability.
Betamax's release did spark a revolution in the way consumers used media. When it was released in 1979 this 36-pound monster was like nothing that had come before it. Surely its future was secure. Early adopters quickly saw the possibilities the machine offered and promptly began recording TV shows, something of a novelty at the time. Its very existence seemed to threaten the entertainment industry.
So much so, in fact, that in 1979 industry leaders tried to argue that recording television shows infringed on their copyright.
This argument culminated in in a Supreme Court case of the Sony Corporation fo America versus Universal City Studios. Sony won the case with five justices voting in favor of home-recording. Despite this great legal victory, the future of Betamax was far from secure. It would soon find a new rival to battle, JVC's VHS recorder.
Why did Betamax lose in the end?
Both these machines solved the same problem of saving information compactly on a tape. Betamax was also believed to provide a better quality of the recording and it was considerably better built. So why, in the end, did VHS win out?
According to Engineer Guy the reason for VHS's victory is obvious in hindsight. Firstly, JVC's VHS was much lighter which makes a big impact when it comes to mass production. This allowed for them to be sold more cheaply, relative to Betamax. Secondly, Betamax's first tapes only allowed for about an hour of recording. VHS, on the other hand, could record double that. This 2-hour recording standard of VHS allowed for films to be recorded with ease.
This would have massive ramifications for both machines in the rental market. VHS would quickly understand the power of this market for selling their product. As the film rental market began to explode, VHS's slowly but surely began to win out. Retailers progressively devoted more space to VHS which would literally crowd out Betamax over time. Betamax, despite its higher quality simply could not compete with the cheaper and more versatile VHS format over time. An interesting lesson for any manufacturer that being first in a market doesn't always guarantee success.
Morita would collapse during a game of tennis in 1993 from a brain hemorrhage. After this event, he decided to withdraw from business and removed himself entirely from active involvement at Sony. Akio Morita was succeeded by Norio Ogha. Norio had joined Sony in the 1950's after he had sent Morita a letter denouncing the poor quality of their tape recorders at the time. That's one way of getting your foot in the door!
Morita did, however, retain his title as chairman until 1995. He would later die in Tokyo from pneumonia on the 3rd October of 1999. He was 78 years old.
Akio Morita managed over his very successful career to pioneer the marketing concept of brand-name recognition. This was at a time when most companies in Japan were producing products for other organizations. This strategy would set Sony apart from the competition and help greatly improve the world's confidence in Japanese engineering. His efforts would make Sony a brand-name synonymous with superior quality.