Q. I hear good and bad about Sony Corp. What do you expect for its stock? - BN, via the Internet

A. While this Japanese consumer electronics giant can no longer command the premium prices for its products that it once did, it is fighting the good fight in a new digital age.

Restructuring, streamlining of manufacturing, changes in senior management and greater focus on software have been its game plan for restoring profitability.

It is being aggressive:

— A new line of Sony Reader electronic book devices was launched to take on the market leader, Amazon.com's Kindle.

— Sales of its PlayStation 3 console have increased since it slashed the price.

— A television capable of displaying 3-D video will be introduced by the end of next year.

— Google Inc.'s Chrome was its surprise choice as the default Web browser in its Vaio personal-computer line.

Sony shares are up 22 percent this year following last year's 59 percent decline.

Chairman and CEO Howard Stringer changed some senior managers earlier this year to put greater emphasis on cost-cutting and software. The company expects an operating loss for this fiscal year that runs through March 2010.

Stringer was also named chairman of the board of Sony Ericsson, the joint venture of Sony and Sweden's LM Ericsson Telephone Co. With Ericsson outsold by smart-phone competitors such as Apple, the Sony entertainment branding is going to be emphasised on future phones.

Consensus rating on Sony stock from analysts who follow it is "buy", according to Thomson Reuters, consisting of one "strong buy", two "buys" and one "hold".

The fact that much of Sony manufacturing is located in Japan and its stock is sold here as an American Depositary Receipt opens the company to increased risk from currency fluctuations. It is also dependent on consumers, who are directly impacted by the economy.

Sony consumer electronics products, which account for two-thirds of the firm's revenues, include televisions, camcorders, CD and DVD players, video game consoles, digital cameras and computers. It ranks second behind Samsung Electronics in liquid-crystal display TVs.

It is also in insurance and chip manufacturing, while entertainment assets include Columbia TriStar Motion Picture Group, Sony Pictures Classics, Columbia and Epic Records, PlayStation and several television programmes.

Sony earnings are expected to decline 17 percent in the fiscal year ending in March and rise 187 percent the following fiscal year. The five-year annualised earnings growth rate is projected to be 16 percent.

Q. What are the fees on variable annuities? - PN, via the Internet

A. Several charges when investing in a variable annuity can reduce the value of your account and return on your investment. These will differ among the 1,400 available products, so always ask for a clear explanation of all fees before you purchase.

There can be a surrender charge if you withdraw money within the set surrender period; a mortality and expense risk charge that compensates the insurer for risks assumed; administrative fees for record-keeping; and underlying expenses for the mutual funds within the annuity.

"Many of the variable annuities have a surrender charge, which means you won't pay something on the front end when you buy but instead on the back end," explained John Gannon, senior vice president for investor education at the Financial Industry Regulatory Authority in Washington, DC.

That makes a variable annuity a long-term investment. There can also be fees and charges for special features that some annuities offer, such as guaranteed minimum income benefits or stepped-up death benefits.

Andrew Leckey answers questions only through the column. Address inquiries to Andrew Leckey, 555 N Central Ave., Suite 302, Phoenix, AZ 85004-1248, or by email at andrewinv@aol.com

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