Sony will buy Sony Ericsson and turn the handset maker into a subsidiary in January 2012. The Tokyo based electronics maker will pay Ericsson just over a billion Euro for the deal, which will allow Sony to integrate phones into its overall product lineup, as rivals such as Apple and Samsung do now. It also means Son can better leverage its broad music and movie holdings in what Sony CEO Howard Stringer explains as the company's 4 screen strategy

Four screens being the tablet, the television, the PC and now of course the smartphone. Acquiring all of Sony Ericsson is such an important part of our business especially with broad cross licensing agreements the stage is set for this strategy. So we don't think it's a name change, but a game change. We are in a position now to move rapidly and more widely using consumer smartphones, latpops, televisions to connect with one another and the world of Sony Entertainment.

Stringer was joined on stage by Ericsson CEO Hans Vestberg who said that handing over its share of Sony Ericsson to Sony is a natural step, leaving the company to focus on building and running mobile networks.

Stringer said that a new Sony task force will examine how best to integrate Sony Ericsson and its smartphones with the rest of the company. In the short term, the Sony Ericsson brand will live on, but Sony will work on coming up with a new one.

With reporting by Mikael Ricknäs and Jay Alabaster, Nick Barber, IDG News Service.