Sony TV and home audio business handed over to TCL

It’s no secret that Sony has not been as successful as its management or investors would probably have liked when it came to TV sales, in terms of both volume and profitability. Despite some excellent Sony TV models consistently winning awards for years, the majority of its product lines in that category are more costly than their LG or Samsung – let alone TCL or Hisense – equivalents, leading to shrinking market shares across the board. Things might have been even worse than that, though, forcing the company to make some difficult decisions: it’s the only way one can explain why Sony is basically handing its home video and audio business over to TCL, as the two companies just announced a joint venture where the controlling stake belongs to the latter.

The official press release speaks of a strategic partnership in the form of a new company which “will operate globally, handling the full process from product development and design to manufacturing, sales, logistics, and customer service for products including televisions and home audio equipment”. This new company “will assume Sony’s home entertainment business” with TCL holding 51% and Sony holding 49% of its shares. Discussions on the terms of this agreement have already started toward reaching executing definitive binding by the end of March and, pending regulatory approvals, the plan is for the new company to commence operations in April 2027.

The intent behind the agreement, at least as implied by the press release’s wording, is to combine TCL’s display panels and manufacturing capabilities with Sony’s expertise in image and sound processing, to the benefit of both. This could, conceivably, lead to top Sony Bravia TV models that are more competitive in pricing, as well as to affordable TCL TV models that sport industry-leading picture and audio.

It’s clear that, since Sony was already sourcing TCL panels for several of its TV models and TCL was still catching up with Sony in terms of image processing, a deal like this makes a certain amount of sense. Economies of scale, R&D costs and various overlaps between the two companies’ workforces should be taken into account too.

What is far less clear is whether this joint venture will benefit consumers, not just these two companies. While TCL has released a number of hi-end, premium TVs over the last few years, its core business revolves around affordable models where corner-cutting in terms of build quality, functionality, after-sales support and software support is a given. The Sony Bravia brand is built around higher price tags simply because they are generally attached to higher-quality products, whose functionality and support are also expected to be better. So how these two, quite different, approaches can simultaneously be followed by this new company across many different categories and product lines remains to be seen.

There’s certainly some healthy skepticism regarding what this deal could mean for the Bravia brand going forward – one can already see online, in fact, why it might seem troubling to Sony diehard TV fans. A joint venture like this one can lead to more affordable Bravia TVs and Sony home audio equipment but not necessarily to better such products. Sony’s design and processing will still work as competitive advantages, but one can’t help but think that if it’s TCL who’s calling the shots – as the majority stakeholder – other aspects of manufacturing might take a hit. TCL may have more to gain through this partnership, as Sony’s technical know-how and Hollywood-derived motion picture expertise could help the former release more hi-end TVs sporting top image quality for less.

There are still a lot of questions regarding this joint venture that we don’t have the answers to, like what exactly each company is contributing to it and what it does not – that is, what each one keeps for itself. Then there are other questions: the partnership definitely includes televisions and soundbars, for instance, but does it include, say, projectors and receivers too? What about future support for Sony’s current and 2026 products? Will the new company only use TCL-made panels for both TCL and Sony TVs? If so, will TCL’s new OLED-producing facilities be ready to supply panels for Sony OLED TVs come 2027?

Come to think of it, how will all of this affect Sony’s 2027 TV line-up, considering the 12-18 month lead-time between development and release of new models? Last but not least, how will this joint venture affect TCL’s own TV line-ups and pricing, once the new company starts releasing its first TV models?

For some of these questions we may have official answers soon, for others we’ll have to wait a couple of years at the very least – obviously assuming that this deal is finalized and approved as planned. It does feel like the end of an era for Sony, though, exactly as it did for Philips when TPV took over that company’s TV business in order to form TP Vision back in 2012. We all know how that played out: TP Vision Philips televisions pretty soon became Philips TVs only in name, as everything that mattered when it comes to watching a TV set and living with a TV set – so, not Ambilight – was and still is handled by TP Vision. Not Philips.

Here’s hope that, long-term, this joint venture does not negatively affect everything that used to make Sony Bravia TVs so good regardless of cost: it would be a great loss not just for fans of cinematic picture quality, but for the home entertainment market as a whole. Cross fingers?