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Sony's Renaissance Geek

In the late 1990s, Tim Schaaff was a senior executive at Apple Computer (AAPL) with a hefty portfolio. He was in charge of QuickTime, the multimedia software for creating, editing, and playing audio and video on computers, which helped extend the Apple brand beyond the company's own PCs.

But Schaaff was more than just a software geek who knew how to deliver a winning product. With Apple in turmoil, Schaaff proved his superb instincts by surviving the shakeup that followed Steve Jobs's return from exile.

Now, Schaaff is navigating similarly turbulent waters -- but this time by choice. Appointed last December as Sony's (SNE) new senior vice-president for software development, Schaaff has control over design, intellectual property, licensing, and product planning and engineering.

GOOD CATCH. Few would argue with Sony's choice for such an important position: He has broad expertise in the full spectrum of media technologies -- from chips to graphics to PC operating systems. "He was about as good a renaissance-man catch as Sony could have hoped for," says Richard Doherty, research director at Envisioneering Group and an acquaintance of Schaaff for a decade.

But Schaaff joins at a time when the $70 billion colossus is struggling through a midlife crisis. Its consumer electronics unit is smarting from back-to-back operating losses, and its products have lost the cachet they once commanded.

Even when Sony was cranking out the coolest gizmos around, its software often disappointed. In recent months, Chairman and CEO Howard Stringer has acknowledged that "excellent hardware no longer guarantees success." He has vowed that Sony "must enhance product interoperability."

LOW PROFILE. What that mouthful means is developing software that lets a Sony digital camera link seamlessly to a video game machine or TV. That has never been Sony's strength.

It could get even trickier as the company rolls out a smorgasbord of new products that run on the Cell, the powerful chip developed jointly by Sony, IBM (IBM), and Toshiba (TOSBF) for use in networked multimedia gadgets. "The Cell is a brand new hardware architecture that nobody has ever developed software for," says Rob Enderle, principal analyst at tech-consulting firm Enderle Group. "It is incredibly difficult" to do so.

It's early to say how much impact Schaaf has had, but it's clear he is keeping a low profile at the company. For starters, he's not based in Japan but in San Jose, Calif. When asked whether Schaaff had traveled to Tokyo for the announcement on Mar. 15 of a delay in the launch of the PlayStation 3, one top exec from Sony's games unit, said: "Who?" Schaaf declined to comment for this article.

Schaaff will have to tread carefully to avoid making enemies in the core consumer electronics division. An uprising led by engineers could dash his hopes of curbing the rivalries that helped foster the creation of must-have gizmos in the past, but which have more recently wasted resources, muddled the product lineup, and spawned myriad software platforms. Meanwhile, he'll want to milk his stature as a software guru and an outsider and give Sony's programmers more authority to call the shots.

BAD IDEA. In the past, Sony's fractured makeup was mainly to blame for the inconsistency of its software. Too often, its best programmers from divisions such as Vaio laptop PCs and digital camcorders weren't able to share ideas with those working on Linux-based platforms in other areas, such as Walkman music players. The semi-autonomy of Sony's divisions also meant top execs got blindsided at times.

Last November the company got embroiled in a public-relations nightmare when a computer systems expert revealed in a blog that Sony BMG Music Entertainment had installed antipiracy software on music CDs that left consumers' PCs open to an attack by hackers.

Reprogramming Sony's corporate culture is likely to be Schaaff's first order of business. Although Sony's expansive empire includes a Hollywood studio, a major recording label, a banking unit, and a video game house, electronics hardware engineers still stand atop the corporate heap.

"Traditionally, Sony has been a hardware maker. Software has never been a priority," says a former top Sony executive. "It won't be easy to change a culture that has taken shape over decades."

INDUSTRY STANDARDS. A daunting task for a greenhorn, no doubt. But Schaaff has known Sony for years. When Apple was negotiating a QuickTime licensing deal with Sony, it was Schaaff who met with the different division heads, according to Envisioneering's Doherty.

Schaaff's 14-year career at Apple also put him in close contact with many of the key tech players -- from PC titans such as Hewlett-Packard (HPQ), Intel (INTC), and Microsoft (MSFT) to consumer electronics makers such as Philips (LPL) -- making him a consummate industry insider and a valuable asset as Sony jostles for space against those rivals in the digital home.

Schaaff's record of backing industry standards at Apple suggests he'll prod Sony toward a similar position. As the head of QuickTime, he made sure Apple took part in the Moving Picture Experts Group and the Internet Streaming Media Alliance, which sought to fix formats for online media technologies. QuickTime's incorporation of those standards helped win wide acceptance for the digital MPEG-4 video format among Hollywood studios, advertisers, and consumers alike.

That dovetails with Stringer's plans to get Sony to embrace industrywide formats and make its gizmos more compatible with other companies'. If Sony adopts the kind of stance that Schaaf did with QuickTime, one day you might be able to download a game, song, or movie from a one-stop Sony online shop onto a machine made by Sony, Panasonic, or Samsung.

SHIP'S CAPTAIN. But some problems might be too sticky for Schaaff to solve by himself. Sony's rich library of content has made execs fearful -- some would say excessively so -- that offering digital downloads might make its movies and music a prime piracy target. For now, its Connect online store in the U.S. sells songs, while a separate Sony Web site offers videos and TV reruns only on DVD. Sony's tiptoeing into the digital market has let more nimble rivals, such as Apple with its iTunes music store, snatch the lead.

"Sony has more at stake than its competitors in this conversion from analog content to digital," says Jon Erensen, senior research analyst at Gartner. It'll be up to Schaaff to help the company navigate the shoals that lay ahead.

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