 Hey everybody, welcome to the Verge Lounge here at CES. I am joined, I'm very excited, Mike Fasulo, the President and COO of Sony Electronics North America is here with me. Thanks for joining us, Mike. Oh, great to be here. Pleasure. So I gotta say, you had a pretty quiet set of product announcements yesterday. I love, I've been live-blogging in Sony keynote for like eight years now. One of my favorite CES traditions is to come to the big Sony show. But yesterday was a little quieter than normal. Is there, and it's a TV show, like where are all the TVs? I didn't think it was quiet at all. Maybe my voice was a little quiet. Everyone's gonna talk about TVs and we talked about TVs last evening. And look, all I can say about Sony television is, with our 4K upscaling and now with high dynamic range, customers should go to the retail shop and visually look at comparisons. Everyone's gonna talk about speeds and feeds and technology, but really it's look yourself at the picture and then choose which one you like best. I'm very confident you'll choose Sony. The TV industry's been looking for an upgrade cycle kickoff. And for a minute it was 3D and that kinda didn't happen. 4K was here and now it's really HDR. And from my perspective, it feels like HDR is the thing that will kick off the big upgrade cycle. Is that how you're looking at it or are you kinda looking at it more broadly? Well, I think 4K is what's kicking off the upgrade cycle. HDR is taking it to yet another level. And when you look at the content in HDR, it's really how the director intended it and it's life-like. So yeah, the cycle's in play now, but this coming year, 2016, is gonna be a great year for television. Okay, so from the pinnacle of visual technology to the future of the past of audio technology. So I gotta say, record player is like a theme of the show. We've seen a couple of turntables. You guys just put out this, I would say, beautiful turntable. It's very sleek in design and it's kind of a hybrid product, right? Go through it with me. It's really cool. So what I thought, I mean, The Verge is everything about what's happening, right? And innovative. So I thought rather than carry a television over, I bring some really neat, innovative products. You know, vinyl LP is such a resurgence and what's so great about it is it's hitting all, not only genres of music, but segments of population. Millennials love it just as much as I love it. So with this device here, it's a really cool device because it does a number of things. One, you can listen to it as a record player in analog stereo and it has capability to rip through DSD and high-res audio. So you can actually take it with you on your smartphone, on your PC, on your tablet and have high-res on the go. What do you think is behind this? There's a boom in vinyl sales. Cosser I was telling me yesterday that Sony Music had to go and find some refurbished vinyl cutting machines because the demand is so high. What do you think is driving that? On the one side, we're talking about how the television cycle is accelerating because the content side can do streaming so much more easily. And on the other hand, we're saying people are buying vinyl records again. So much so that it's CS 2016, you're putting on record player. What's behind that here? Who would have thought, right? It's cool. I mean, the texture of vinyl, it's different, it's happening, it's new. It's new. Yeah, it's new. It's incredible. It's catching on with a huge trend. So any price to release it on this guy? We're not releasing pricing at the show, but this will be shipping this spring to summer. I think it's fascinating. It is such a cool product. And then it's like the crazy stuff. So what is this? Not so crazy. Well, this one, these two are particularly cool. Look at that, you're holding it in your hand. You're holding an 80-inch projector in your hand. So that's our ultra short throw projector. And it projects a screen size from 22-inch up to 80-inch. And you can see that it's portable. You literally hold it in your hand. You guys can't see this, but it has this texture. This is a beautiful little device. It's Sony, it's very well made, it has this beautiful texture on the side. It's got a built-in battery. How long does this battery last? Good question. I got to get back to you on that one. So, what is this for? That's for either living spaces that can't accept the large screen television or for portability if you want to project in the office, at a meeting, you want to project it in different rooms in the house, or if you just want to project content on a wall for artwork. And so how do you get content into here? You stream on a phone? You can HDMI, it's Bluetooth. And price to release it on this guy? No pricing. So, these two objects right here, this is the projector, this is a light bulb that has a Bluetooth speaker in it. I love this. This is so cool. Yeah, we'll talk about this in a second, but these are part of the LifeSpace UX, which a few years ago was a bunch of really high-end concept products, projectors built into sofas. It was like a whole separate room of dreams that you had to book an appointment at CES-to-C. And now it's several years later and the stuff is in my hands. We're delivering. And it seems like these are kind of Sony's experiments into what new kinds of consumer electronics could look like. Yeah, I mean, we still put a significant amount of resources in R&D, and we're always testing and listening to customers and trying to understand trends and what customers' needs and wants are. And some of these are novelties. Some of them will be mass products. I think that turntable is going to sell in huge quantities. The ultra short-throw projector, maybe not, but it still shows that Sony does lead in engineering and innovation, style and design. I mean, look at the style and design of that. It's fun. This is funny because there's a little cube speaker I had on my desk, a little Sony cube speaker, and it looks like you guys took that speaker and you said, what if we just put it in a light bulb? I'm not sure that was the thing. But anyway, we'll go with it. But I love that little speaker. This is a speaker light bulb. So the power, when you screw it in, that's the power source, and then it's Bluetooth. So you can take your music from your phone and put it into your light bulb or from your PC or tablet, take it with you to a party, take it with you to another room. Let me just walk through the take it with you to a party scenario. So you, Mike Fasulo, have arrived at a friend's home for a party, and your first move is to go to the nearest lamp and surreptitiously screw in a different light bulb? Absolutely. If I could screw it in at the entrance of the door, I could do it. So you'll be seeing missing light bulbs in people's homes. I always say technology changes culture. And if we can get to the point where everybody has their own light bulbs and they're just sneaking around parties, that would be great. So these two, and I just want to focus on the life-safe stuff for a second. It really does seem like you said some of these are going to be big products, some of these are going to be novelties. Where do you see the line? Like are these experiments in the market that you're seeing where the consumers respond and then you'll invest more? Or are these like, this is Sony's vision? Well I think it's a little bit of a mixture of both. I wouldn't call them experiments because we are seeing the life space, how people live, change. And there are trends to smaller living spaces and flats and studios, metropolitan areas. That whole American dream of a big house with a white picket fence, it doesn't prevail across all generations. So it's not only experimental, it's actually building devices and innovative devices that can get to audio and video, good audio and video, in difficult spaces to get equipment into with these type of devices. So from that point of view, it is following trend. From a point of view of how mass the market is, then maybe experimental, a little bit of novelty. One thing that I noticed, both you and Kaz said yesterday, which was very interesting in the context of Sony, you mentioned being profitable and wanting to run a profitable business, Kaz mentioned wanting to run a profitable business. There have always been questions about how can Sony re- TV's I think have been a question, how can they reassert- Which are profitable. Which are profitable. Why was that theme present yesterday? Was it more about investing in the areas that are growing? Was it more about convincing your investors and the broader public that Sony is a force? Where did that theme come from? A couple years ago, the theme came from our financial performance. And what we've done is we've under Kaz's leadership, we've changed our direction to be what customers give us credit for. A premium brand that brings premium quality innovative products to market. The only way to do that, the only way to get back to significant R&D investment is to be profitable. So by moving back to our core, in NCE this is by the way, in consumer electronics, particularly in television, but moving back to our core capability of providing the best audio and visual quality on the market in a wonderful, beautiful, elegant design, we're now able to capture a premium. It's a value in the product, but it's a premium versus entry level market share game, right? So we're not after market share. We're after delivering to the customer the best experience through audio and visual quality, and by doing so we're making money. Awesome, and well thank you so much for being here. My pleasure. Yeah, always a pleasure. Look forward to it next year. Yeah, we'll be back with the next generation of turntables. It'll be amazing. Yeah, thanks everybody, we'll talk to you soon.