BY DAISUKE WAKABAYASHI

Over a span of three days last week, a trifecta of Japan's most-celebrated electronics companies—Sony Corp., Sharp Corp. and Panasonic Corp.—gave up hope for an annual profit, projecting combined losses of nearly $17 billion for the March-ending fiscal year.

Short-term problems have contributed to this year's tide of red ink: the strong yen, last year's earthquake and tsunami, floods in Thailand and rising energy costs.

But the issues plaguing companies like Sony, Sharp and Panasonic are more fundamental. Once the dominant force in the consumer-electronics industry, Japanese firms simply aren't creating enough of the electronics people want.

What they do ...