Toshiba mulls to seek more money for Sony recall

The woes of one of the world's largest media conglomerates, Sony Corporation, doesn’t seem to stop rather amplified on Monday when Toshiba Corporation, a diversified manufacturer and marketer of advanced electronic and electrical products said it may quest compensation from the Japanese electronics conglomerate for lost business opportunities or decline in value of its brand as a result of the recall.

Besides Apple Computer Inc., Dell Inc., Lenovo, IBM and Hitachi Ltd., Toshiba is also recalling the laptops embedded with Sony-made batteries, which according to Sony can overheat and catch fire on rare occasions.

The Tokyo, Japan based high technology electrical and electronics manufacturing firm, Toshiba, which is recalling 830,000 Sony battery packs, feels it bad from point of view of their sales and image. The company yesterday said it is contemplating various criteria including seeking compensation for lost business or damage to its brand image it faced due to the massive recall.

"We are considering various possibilities, but we have not made a final decision," company spokeswoman Junko Furuta said.

Sony, on the other hand, has said it would pay for the recall costs, but Toshiba was meditating seeking more money. "Besides direct recall costs, we are looking into additional impacts" such as damages to its product and brand images and potential loss of sale opportunities, Toshiba spokesman Keisuke Ohmori said. "Nothing has been decided. But we don't deny the possibility that we will ask them to cover those damages."

Joining the notebook PC maker Toshiba, two other Japanese PC makers, Fujitsu and Hitachi said yesterday that they are also considering seeking compensation from Sony Corp. over the massive recall of Sony-made batteries used in their laptop computers.

However, Fujitsu said it has no plan at the moment to ask Sony for compensation for indirect recall-related damages. "If volume retailers started taking our products off their shelves, that would be a different matter. But nothing like that has happened," Fujitsu spokesman Toshiaki Koike said. "We have not seen any clear evidence that we suffered from loss of potential sales or damage to our products' image," he said.

In addition to the recall of 287,000 Sony-made lithium-ion batteries earlier this month, Fujitsu last week announced that it would replace 51,000 more such batteries worldwide.

At the same time, Hitachi Ltd., which is recalling about 16,000 such batteries, also expressed its intentions to seek compensations from Sony. But replacing the imperfect products is a priority and will decide a measure after making discussions with Sony, company spokesman Masayuki Takeuchi said.

Although, the companies involved in the massive recall move claiming for the direct as well as indirect compensations, but ultimately there is only Sony Corporation which is facing the real damages, both financially and dignity wise. The string of recalls and a delay of its PlayStation 3 game console launch in European markets due to a production snag have made it hard to retain its paramount position in the technology and damaged its reputation as a pioneer manufacturer.

Almost every major laptop manufacturing firm was forced to urge users to return Sony-made lithium ion batteries, with over 7 million batteries globally subject to replacement. Sony expects costs of at least US$170 million related to the Dell and Apple recalls. But Sony is now expected to face an even heavier financial burden with the additional recalls.

In Tokyo, at 10.46 am, Toshiba was up 23 yen or 3.16 pct at 750 yen, while Sony added 140 yen or 2.94 pct to 4,900 yen in Tokyo.