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May 13, 2006

Sony digs hole, keeps on digging

Posted by David Hunter at 9:52 AM ET.

Sony’s less than bravura performance at E3 has turned their PlayStation 3 plan into a figure of fun:

But punters meandering away from the E3 games fest this week can’t help but think that somehow, somewhere, a burst of insanity has seized the company.

The only likely scenario can be one like this: Imagine a Sony boardroom last June. Welsh wizard, Howard Stringer, is in the chair for the first time.

(ACT ONE)
The Sony boardroom. SONY EXECS seated. STRINGER pacing.

STRINGER. OK, moving onto the PS3… what is the easiest way for us to lose the ball on this one?
SONY EXEC ONE. Price, if we make it too expensive then Nintendo and Microsoft will screw us to the wall. Most people will not pay more than what the XBOX 360 costs.
STRINGER. Great, anything else?
SONY EXEC TWO. We could delay it for ages until Microsoft has established itself in the market. That would make it harder for us to claw back our lucrative European and American base.
STRINGER. Not bad, need a few more here.

Well, truth once again imitated fiction and the wish was granted – Sony’s Kutaragi Says That PS3 Should Cost Consumers More:

Adding more fuel to the PlayStation 3 fire, Sony Computer Entertainment Inc. (SCEI) president Ken Kutaragi is not only defending the PS3′s high price of entry, but he says that it’s not expensive enough.

Kutaragi goes on to explain his position concerning the price of the PS3, “For instance, is it not nonsense to compare the charge for dinner at the company cafeteria with dinner at a fine restaurant? It’s a question of what you can do with that game machine. If you can have an amazing experience, we believe price is not a problem.”

The opportunities for amusement with this are boundless, but the commenters on the above post have done an ample job, so I’ll just stick with the mundane. As I observed the other day, Microsoft’s prospects in the game console business keep looking better and better, primarily due to the incompetence of the competition. All Sony really had to do to play credibly was show up with a “good enough” offering, but it appears they are fundamentally incapable of doing so. It reminds me of various storied episodes in the history of the personal computer when Microsoft’s competitors seemed to be doing all they could to hand market share to Microsoft.



Filed under Coopetition, Microsoft, Sony, Xbox

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3 Responses to “Sony digs hole, keeps on digging”

  1. Wall Street upbeat about Xbox 360 after E3 -- Microsoft News Tracker Says:

    [...] Dean Takahashi has a roundup of analyst reactions to the E3 gaming conference, but the most startling is: Rick Sherlund, an analyst at Goldman Sachs, wrote this morning that he raised his unit shipment estimates for the Xbox 360 and for revenues in the 2007 fiscal year which ends June 30, 2007. Among his big statements is, “We believe Xbox may outsell Sony’s PS 3 outside of Japan. We have also model an assumed $100 price cut on Xbox 360 by E3 next year to further drive market share.” Sherlund says he believes Microsoft could become profitable in the current calendar year on the Xbox 360 business. That commentary is more positive on Microsoft than any other analyst so far. After Sony’s dismal E3 performance ([1], [2]), I’ll believe anything. There’s more in this Bloomberg report. Filed under Coopetition, Xbox, Sony, Microsoft Listen to this article   [Permalink] [...]

  2. Sony exec says PS3 to replace PCs -- Microsoft News Tracker Says:

    [...] Or as Brandon Hill’s article at Daily Tech is titled, Sony Exec: We Don’t Need No Stinkin’ PC. The exec in question is Sony Computer Entertainment’s Worldwide Studios president Phil Harrison and in an interview with Der Spiegel he delivered himself of the following: Besides defending the PS3, Harrison took time to evangelize the device, which will launch worldwide this November. In particular, he said the Linux-based operating system on the console’s hard drive will have enough processing power and nongaming functionalities to render traditional PCs–most of which use a form of Microsoft’s Windows OS–moot in the home. “We believe that the PS3 will be the place where our users play games, watch films, browse the Web, and use other [home] computer functions,” said Harrison. “The PlayStation 3 is a computer. We do not need the PC.” I’ll bet that’s a shock to the folks building Sony VAIO systems. Sony certainly has a streak going with the PS3. Filed under Coopetition, Xbox, Sony, Microsoft   [Permalink] [...]

  3. Microsoft exec dismisses Xbox compatibility -- Microsoft News Tracker Says:

    [...] I guess Sony executives have no monopoly on putting their foot in it over console gaming ([1], [2]). Peter Moore, Microsoft’s Corporate Vice President, Interactive Entertainment Business, Entertainment and Devices Division, riled the fans yesterday in a video interview with game site Kikizo: One thing that Xbox 360 users with hard drives benefit from is backwards compatibility with Xbox 1 titles, but some gamers have been underwhelmed by the volume and quality of games that are compatible on the new system. It doesn’t look like much is going to change either, based on Moore’s latest comments in the interview. “Nobody is concerned anymore about backwards compatibility. We under promised and over delivered on that. It’s a very complicated thing… very complex work. I’m just stunned that we have hundreds of games that are backwards compatible.” [...]

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