Thursday, July 20, 2006

Advice for Sony

Change or lose the console wars. Gamespot reports on DFC Intelligence analysis:
DFC begins by saying that Sony is currently the "king of the video game market," but with the PlayStation 3, it is clear that Sony is "handing its competitors a golden opportunity." The firm believes that the premium PS3's $600 price tag will put off potential consumers, hurting the overall gaming market and possibly putting Sony dead last in terms of installed user base.

It's not just the launch price that DFC believes could hurt Sony. Sony CEO Ken Kutaragi has gone on record as saying that the PS3 is more like a computer than just a gaming console, and, according to DFC, could see upgrades such as a writable Blu-ray drive or improvement to the system's memory.

While this may appeal to gearheads, DFC believes it will mean the price of the PS3 won't drop at the rate of normal consoles. "By fixing its hardware standard for several years," DFC argues, "video game console systems have been able to significantly lower prices over time by not having to upgrade to the latest technology."

"We believe that under Kutaragi's techno-elite PlayStation 3 strategy, the PlayStation 3 could end up with a market share more resembling Apple products [in the PC sector] as opposed to the dominant PlayStation 2 market share."

As for the other consoles, Microsoft's Xbox 360 and Nintendo's Wii, DFC sees scenarios where both of them could become the leader in installed base.

Even though the firm doesn't see an end to the 360's woes in Japan, it sees its strength in the North American market as reason why it could be the market share leader. The Wii, on the other hand, has "the biggest opportunity" because of its low price and potential to "expand into a much more mass market audience."


Bizarro Jack said...

I've also read that IBM is having some pretty bad production problems with the Cell processors; Apparently only 10%-20% of them have all 8 cores running, although they apparently are capable of operating without all 8. I bet the mood over at Sony Gaming is a bit dark.

The price point, though, is what has me as happy as ever to be limited to PC gaming.

Steven Den Beste said...

I'm not sure Sony actually cares all that much about those things. I suspect that the real goal of the PS3 is to seed the market with devices that can play Blu-Ray DVDs. Sony stands to make a whole lot more if Blu-Ray wins the format wars than they ever could in the console game market.