Sony Corp. confirmed Friday that it is considering entering the retail Internet banking business in Japan.
An exploratory group at Sony is studying how the electronics giant could set up a "personal Net banking service" and what sort of business plan to adopt, a spokesman for Sony's U.S. subsidiary said. He said Sony formed the group at the beginning of December.
Citing unnamed sources at the company, the Japanese newspaper Yomiuri Shimbun reported Friday that the company plans to begin Internet banking services in early 2001. The newspaper also reported that Sony hopes to accumulate several hundred thousand customers in the first three to five years.
The spokesman characterized that report and others that appeared in Japanese newspapers as speculative.
Though Sony is well-known for its consumer electronics and entertainment businesses, the corporation is no stranger to financial services. For two decades it has operated a life insurance subsidiary in Japan.
Sony also has ambitious plans for the Internet, said Phillip Oleson, who analyzes Sony's corporate debt at Warburg Dillon Read.
"They've spent a lot recently to develop an Internet infrastructure in Japan," he said. "They may view a possible Internet bank more as an E-commerce initiative than an E-banking initiative. It would leverage some of their core competencies in terms of technology, brand, and financial services experience in insurance."
Mr. Oleson said the strength of the Sony brand could give the company a leg up on other Internet-only entrants into Japanese banking. He noted that many Internet startups must budget large amounts of money for advertising and marketing.
- Ross Snel