Sony Reworks PS3 Strategy, Delays Launch of Virtual Community; Closing ImageStation Photo Service

Sony (NYSE: SNE) has promised to tap additional video game producers for Playstation3, in hopes of creating greater demand for the video console, attempting a turn back the disappointment that continues to plague it, WSJ reports. Speaking at the Tokyo Game Show industry conference, Kazuo Hirai, the head of Sony’s videogame division, also said the company was holding on releasing the full version of its PS3 virtual environment, Home, until sometime in 2008. Although Sony has been prepping the virtual world for the past year, Hirai indicated that the feature did not yet meet his standards.

While some attendees seemed pleased with the tacit recognition Sony needs to carve out a new strategy, there was disappointment that the issue of PS3’s $600 price tag, which has been cited for the disappointing sales (2.9 million in the U.S. and Japan) versus Nintendo’s Wii (7.4 million in sales in both countries) and Microsoft’s (NSDQ: MSFT) Xbox (6.7 million), was not addressed. The company was expected to cut prices back in July. But Hirai told the Journal that he wants to concentrate on the PS3’s software capabilities, adding “Pricing is important…but price alone does not drive any product.”

In related news, Sony Electronics is going to close down its ImageStation online photofinishing service by mid-November and is encouraging existing users to switch to Shutterfly’s service, reports PCWorld. This is the second online service is is closing: last month it announced it is closing Connect online music service.