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Sony Playstation 3: Sony looking to make key changes

By: Chuck Schoene - Published May 06, 2007 at 10:02 PM EDT - Writer Archive
With Microsoft releasing their new Xbox 360 Elite and Nintendo dominating the console market with its Wii, Sony is looking to try and recover... but will it be enough?

Sony has been plagued with bad publicity, defective products (laptop batteries), and even worse, market strategy decisions. As Sony watched Nintendo spank everyone else on the gaming front with their innovative Wii and dominate the handheld market with the DS, they have to be wondering what happened to their throne. Then, along comes Microsoft and the Xbox 360 Elite. It comes with the shadow of success from little brother Xbox 360, new larger HDD and HDMI and oh, it's black.

As to bad marketing decisions, as this article was being written, a new blow to Sony and God of War II has hit the internet. At the God of War II release party hosted by the UK Sony division and their UK Playstation magazine, they decided to have a Grecian feast with a dead goat as the center piece. I am not saying this was the worst choice they ever made, because we all know it is not. But could it be the one that hurts them the most? As in all things, there are two sides to the matter. Sony states that a third party was hired to host the part and make all decisions in regards to it. Anti-gaming and people from associations such as PETA say it is appalling and the reason kids kill. Whatever the angle chosen, it is still bad press for all gamers and especially Sony.

So, what should Sony do to regain there throne as King of Console?

Step One: Kill the 20GB version of the PS3. Why this one was even made I am not sure, other than get rid of their excess stock of 20GB HD sitting on the shelf. So after years of developing, creating and distributing, it died in less than 6 months. For most retailers and gamers this comes as no real surprise as the 20GB was not selling compared to the 60GB at a ratio of almost 10 to 1.

"At launch, we offered two separate models of PLAYSTATION 3 to meet the diverse needs and interests of our PlayStation fan base. Initial retail demand in North America was upwards of ninety percent in favor of the 60GB sku, so we manufactured and shipped-in accordingly. Due to the overwhelming demand for the 60GB model from both retailers and consumers, we have ceased offering the 20GB model here in North America," said SCEA senior director of corporate communications Dave Karraker.

"In addition to the larger internal hard drive, the 60GB PlayStation 3 features added storage media slots and built-in Wi-Fi not found in the 20GB system. Based on retailer and consumer feedback, we have decided to focus our current efforts on the more popular 60GB model," he concluded.

Step Two: Create a larger model to compete with the new Xbox 360 Elite, thus creating a battle of the next-gen consoles round two. As there has been no official word as of yet, one would say no but as I am the ever Sony-optimist, I believe in the very near future it will be a yes. Sony will want to compete on a level of storage capacity. I personally don’t believe this one thing will make a big impact but should be enough to push in the right direction. If Sony goes in this direction anything less than 100GB may not be enough for consumers to even think about upgrading. Here is a letter sent to Microsoft from SVP Peter Dille.

"We think every PlayStation 3 owner should have an 'elite' experience, which is why we include an internal hard drive and HDMI output in every PS3 we sell, along with the 50 GB of storage capacity on a high definition Blu-ray disc. Sony has been the strongest advocate of high definition as the future of next-generation gaming. This requires high-definition components, including HDMI output, and large storage devices to deliver and store all that rich and vivid HD content. Microsoft's announcement today [er, "tomorrow"] not only legitimizes Sony's PS3 strategy, it moves us closer to adopting universal standards in the area of high definition gaming that will benefit game developers and ultimately the end user."

Step Three: Fire a legend and bring in the top contender. Ken Kutaragi may have been, nay, is the father of the PlayStation and PS2 but it seems as if he went down swinging with the PS3. Through bad marketing, production problems, and extremely disappointing sales, Sony had to find someone to throw under the proverbial bus and Kutaragi seems to be just the person. So now that he is out, who's in? Kazuo Hirai, a more software minded leader. This may be a great step for Sony as every gamer knows it is the games that sell a console. With many exclusive titles going over to its competitor Microsoft, this may be just the thing Sony needs.

Step Four: Drop the price! No. Sony has dropped the price on its history making PS2 and its struggling PSP but it should hold off on a price drop for the PS3. This is simple economics, price does not create a demand. Until Sony can show gamers, and even the gamers who dislike Sony, the true advantage of having a PS3 over any other system, price will not matter. Mind you, this editor believes the PS3 is worth every penny it costs and still would be at any price point under $600. Now after almost a whole year on the market with a solid, must-have library of games available, plus the creation of a cheaper blu-ray diodes for the the laser, then drop the price. All that's left is to watch consumers eat up the PS3 for the holidays and ask for seconds.

User Comments


Step 3 is already done . Kenny is "retiring" in june

http://dailytech.com/article.aspx?newsid=7078
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ooo Im really looking forward to see how Sony, and everyone will adapt to those changes
"We beat zEx we move on but..." -Jason Lake
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Nicely written.

Sony has taken numerous risks with the PS3 hardware wise, but after a few top-notch software titles hit stores and (hopefully) blu-ray wins the format war down the road, they'll be raking in the cash.

As for HDMI, I think it's more a luxury to not have to use 3-4 different cables. There really isn't enough of a quality difference for me to say, "Oh wow, it has HDMI!" Same with wi-fi; more luxurious than necessary. Any "true" gamer wouldn't use wi-fi due to outside interference effecting signal and, of course, less bandwidth compared to hardwire.

This comment was edited at 05/07/2007 12:50 PM
PSN ID: MrMcdoobie
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Step 1 and 3 are already both done.
Stores no longer carry the 20gb & Kenny is retiring according to post #1
There is no point in sony to make a bigger Ps3, since the HDD is upgradeable to however much space you want
& for step 4, it will eventually come, just give it time, possibly for the holidays
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cool and i agree
Hi.
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ur points makes sense cept for #4 which i feel is flawed for these reasons...

price creates demand in a sense... however just because u can AFFORD something doesnt mean you will BUY it... any home owner could AFFORD a 400k car, but that would require them sacrificing their house... however, if what you say is true, then wed all be driving ferraris and lambos... since the price is kinda high, that kinda snuffs out the demand. oh and for debating's sake advantages of owning these cars = women, crazy speed, the envy of your peers (if anyone say this is synonymous with owning a ps3, then thats pretty sad), pure adrenaline, sexy italian design, and a whole myriad of other things

now if you take economics into perspective, the median household income in an area like the United States is around 45k untaxed, so youre looking at roughly a 30k take home... so i dont think ppl in the median and below or slightly above will spend 600 bucks like that... also mix in the standard that most people have not converted to HD (yet) n probably will not until 2009 and you have problems as far as unit movement

economics would also dictate a price drop might be necessary since they waste money storing excess inventory... so for each unit they dont sell... thats money per day of shelf life IN ADDITION to the money they lose per unit... u also need to factor that technology also costs less to produce because it slowly becomes outdated... now this is where they have to assess where and how much loses they can take and if having a ps3 wait on a shelf for a month will cost them more than doing a price cut (since retailers will order less ps3s since they wouldnt need to keep their shelves stocked, thus creating more inventory to store their ps3s which cost money to produce... its basically a cascade of things...etc)

now on the other hand, arguing it as a blu-ray player/multimedia device... ull have a stronger case since 600 for a blu-ray player is incredibly cheap n definitely worth it... but then u run into the median income/minority of HDTVs rebuttal again
#donuts-. www.mantouch.com -.- #llamapatrol -.- www.myspace.com .-#washedup
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#6 - What he is saying, I believe, is that price does not CREATE demand. It simply meets the demand that is already there.

i.e.

4 million people want a PS3 for $600
10 million want a PS3 for $500
100 million want a PS3 for $100 etc etc

However, creating games that will interest gamers means that more of those people in the 10 million crowd will pay $600 if there is now added benefit, warranting them to pay the extra money, since the games they want are available. Therefore, Sony would CREATE demand by releasing popular titles, added features online, etc etc. Dropping price does not create demand.
Editor in Chief DPAD eSports, GotFrag member since Day 1.

im waiting until metal gear 4 comes out then im going to buy my ps3. ive really lost touch with console gaming since i get into PC games but there's no way im not getting meta gear 4. especially when it comes with a system that doubles as a cheap blu ray player :D.

ps3 will do well it just needs better marketing, a new rush of games, and the holiday season.
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although #6 makes good points #7 hit the nail on the head :P

cept not even 4 million want a ps3 at $100 let alone $600 (BUUUUUUUUUUUURN)
BLAM!
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#4 Thats going to be a long wait my friend. A looooooooooooooooooooooooooooooooooong wait. But I have faith in the lowering of the price besides something will have to give eventually. Right?
'This is how the world ends. Not with a bang. but a Whimper.' - T.S. Eliot

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