How Sony Can Boost PS3 Sales

60 Comments

As this holiday’s video game sales are tallied up, one thing is already clear: As an article in the Wall Street Journal notes, Sony’s (s sne) PlayStation 3 remains in a fairly distant third place, still eclipsed by Microsoft’s (s msft) Xbox 360 and Nintendo’s Wii. While it’s probably too drastic for Sony to walk away from the PS3, I definitely think they need some bold and creative changes to make their console competitive, namely to acquiesce to market realities while leveraging two underutilized assets. Here’s how:

Release a discounted, broadband-centric model of the PS3 WITHOUT a Blu-ray:
Sony’s high-definition Blu-ray decisively won the standards war, but the market’s been slow to give them a victory parade. For now, the PS3’s Blu-ray player doesn’t seem to be a huge selling point, but for Sony, it’s a huge investment. (Merrill Lynch estimated the Blu-ray will cost the company $100-$350 per unit over the console’s first three years.) The short-term solution is to manufacture a new PS3 line that comes without a Blu-ray. Sony could sell it for considerably less than the current $400 MSRP. While the standard PS3 will still be for sale, this cheaper model (call it “PS3 Net”) could come with several consumer-selected Sony games pre-installed in the hard drive (see below), and take advantage of high-speed broadband, especially in Japan, for downloading games, movies, and other content via the PlayStation Network. (And PS3 Net owners can still buy an external Blu-ray drive later.)

Slow the Wii’s growth by revamping the Playstation 2:
From Sony’s perspective, the console wars are a battle of opportunity cost, as every consumer who buys a Wii or Xbox 360 is unlikely to buy a Playstation 3. At the moment, that’s roughly 68 million next-gen console owners, according to VGChartz. However, combined Wii/360 ownership is still dwarfed by the 9-year-old Playstation 2, whose install base topped 140 million as of last summer and due to its affordable $130 MSRP, is still selling extremely well. To prevent all these PS2 owners from transitioning to a competitor, Sony should market several add-on packages to keep it current, especially against the Wii: A PS2-bundled with Eye Toy and other rhythm/motion game peripherals with new software, for example, and another bundle which adds wireless Internet connectivity, web browsing and downloadable content. Features like these will convince PS2 owners to stay in the Sony family while they wait for the PS3 price to drop.

Expand the PS3’s audience with a fully leveraged Little Big Planet:
With its cute-ugly characters and whimsical settings, this season’s PS3 exclusive Little Big Planet is far and away the console’s best chance to expand its audience beyond a core fan base of hardcore gamer dudes to kids and women gamers, two audiences the Wii has so far owned. With its creation and network-sharing tools, the game also turns the PS3 into the best platform among consoles for user-generated content. To capitalize on these advantages, Sony should sell a discounted version of the PS3 (see above) packaged with Little Big Planet, with additional enhancements such as a virtual currency/content marketplace, and a mini-MMO space linked to Sony’s new (but in my view, troubled) virtual world, Home.

But how feasible are these suggestions? I ran them by a developer friend who recently left the PlayStation group; he gave me his perspective on condition of anonymity. He liked the Little Big Planet idea most, adding that Sony “should focus more on a marketplace for casual and hobbyist games on the PlayStation Network,” a bit like Xbox Live’s XNA Creators Club, but using Apple’s (s aapl) iTunes app store/iPhone developer program as a model.

As for releasing a PS3 without Blu-ray, that strategy “makes sense and also has a probability of 0.0%,” he told me via email. “Sony is a huge company and there are many things that Sony Electronics and Sony Computer Entertainment would LIKE to do but cannot because of being in the same group as Sony Music and Sony Pictures.”

Similarly, he didn’t think a revived PS2 would do the company much good: “Nothing Sony does is going to slow the Wii’s growth, and if they get in that game, they are making a mistake,” he wrote. “They need to finish the game they started.”

Judging by his reaction, that might be Sony’s biggest problem. Even if the company was willing to make some daring course corrections now, it may be too late to change the heading of such a large corporate ship.

Image credit: www.littlebigplanet.com

60 Comments

John

Xbox Live is packed full of squeeky voices of 12 year old boys. Sony has lost a whole generation to Microsoft as these boys will have income in 5 short years and have no loyalty to Sony. Its just that simple… Who owns the 12 year olds. Who is able to put together a system that the 30 year old will love (hardcore) while still making it fun for the kids. This is the marketing black hole that Sony fell into and the one that will sting them for at least a decade. Microsoft is a lot of things but stupid they are not. They would never turn their backs on the future for more than a short time (first year expensive) Nintendo will have to make a expensive machine to keep its fans (when they get hair on their chins) but thats not their turf. Working with 3rd party and running at a loss is a art that Nintendo has no experience with. The Xbox 720 is gonna be a monster that will pull off what the PS3 failed to do… up sell its loyal customers. look how fast the xbox 1 (very good machine) was tossed aside in favour of the 360. This had nothing to do with the xbox 1 sucking and everything to do with its fans wanting to bend over. The sparkle in the 360s fans eyes will be leaked in 09 (quad core SCALEABLE chip) complete backwards compatability (scaleable) with enough resources to sink a ship. All before Sony has half payed off its dept on the PS3. Death Blow!!! Maybe even a bluray drive lol

John

The problem isnt the bluray its the cell chip. it isnt simply the quad core nature of this chip. Its the fact that programs have to run to make up for its short comings, further draining its limited resources. Yes its possible to code excelent games for the cell but Microsoft will lap you (many times) in the process with its 360 (PC) set up. Sony is stuck between a rock (Nintendo) and a hard place (Microsoft) and really all that they are left with is marketing and a shrinking fan base. Bluray is sweet on the eyes but so are standard DVDs on my 50″Samsung DLP (Honest) So it would be nice to upgrade but hardly necessary. The ending is on the wall with Nintendo selling the most machines and Microsoft the most software and poor old Sony in third. Only to loose its bluray win to another format that will be at the right place at the right time. Sony bet it all without even looking up at what the market had in store. Complete failure… No, King of games… Not by a long shot.

ChrisWanker

LBP should be released for the PS2. Sony would make 100Xs the profit!

And, I bet they could do it with little to no graphics and content degradation!!!

Mark

Rubbish article.

Merryl Lynch’s outdated estimate of $100-350 per unit is utterly meaningless. Any idiot on the street could have provided such a vague estimate back then. That’s why all those analysts are now jobless.

Making a PS3 without a Blu-Ray drive and undercut the Blu-Ray movement after Sony’s already invested massively into Blu-Ray and when Blu-Ray drives are getting cheaper and cheaper (between $50 and $75 per unit) is just plain stupid.

Your other two ideas are actually interesting. Sony has done a poor job recasting the PS2 hardware, which actually has better graphics than the Wii (see GT4, God of War), as a Wii alternative. This is because Sony is a huge company and like all huge companies is stuck in tunnel vision.

Your other idea regarding Sackboy is also good but Sony has invested so much in Home it’s hard to imagine the bean-counters allowing any more spending on free lifestyle products.

Bob

The PS3 was designed primarily to promote Sony’s latest attempt at controlling a media format that they could milk for every penny possible, that much is evident in the promotion of the PS3, not as a games console (Epic fail) but as an entertainment system (also an Epic failure).

Blue Rays advantages over a decent upscaling DVD player are minimal and HD/Blue Ray will quickly be replaced by 4K (4,096 × 2,160) which is already the standard used for digital imaging in movie making and provides a real jump from DVD.

Dak

with the economy in the doldrums, less and less people are going to be running out buying $400-$500 game systems. I wanted a PS3 but just couldn’t justify it and the fact the games and movies cost so much. I do have a Wii and am actually happy with that – although did end up spending an add’l $100 on assy.

Michael

What’s with people using arguments from two years ago?

There are soooo many games on PS3, and tons that are exclusive and phenomenal like: LBP, Resistance2, Uncharted, MGS4, Ratchet, Warhack, The Show, HotsShots, Syphon, Buzz, Singstar, Heavenly Sword, Valkyrie Chronicles, Foklore, Socom PSN games etc. There are also titles coming like: GodofWar3, infamous, heavy rain, gt5, Killzone2, yakuza3, afrika, White Knight Chronicicles, ff13versus, etc.

Bads ports is mostly a thing of the past, and sometimes better such as IGN having slight preference for the PS3. More games now are taking the PS3 as a lead platform, especially as the PS3 worldwide is very successful.

Resolution? What??? And anyone with a HDTV knows the benefit of bluray, a very fast growing market.

Paying advertising?? Seriously, lack of marketing and advertising is the problem for Sony, that doesn’t overhype mediocre games or it’s one and only quarterly exlusive like it’s competition has been more widely accused of, but instead focuses on free online with dedicated servers, hardware functionality and firmware, and game development of many 1st party titles.

corndog

josh said: They should go the way of Sega, they only released like (about) 10 games. Dang man! You didn’t pull any punches! lol For the record it was 58 games, but I get your point. Anyway I was deciding what to buy my girlfriend, I choose DS lite but if I was deciding for myself instead of her I would have went with PSP. I think before they get out of PSP they would get out of PS3 first(then PSP). Because PSP is in second place, and they have a lot of systems sold. But I think people are not realizing that when they talk about how much they are losing it is averaging the cost of investment into the price of manufacturing. Point is they ALREADY spent that research and development money. They need to lower the price and stop trying to recoup it in the cost of the system and try to get it in the cost of game royalty (like they pretend to do now, Microsoft and Nintendo included). Do people actually believe that HP can assemble a pc with modern parts from hundreds of manufacturers give each of them (plus whole sellers) profits from hardware sales. Plus software profits. All for $299 and screen and software included dual core way more memory, ram, wireless and Sony can’t do it with a machine that is less powerful, two years after release? PLEASE!

Ashtin

Playstation could easily sell its system for less. Sell the system with a 30gb hardrive. That would make the system around about 300 bucks. Then after that make the ps3 only compatible with sony hardrives so if someone wants to upgrade the hardrive the have to buy from sony which gets them money. In the end sony is making just as much if not more money doing this.

spriggers

I like some of the ideas, and have talked about using the LBP engine for Home before. You could have your own apartment, but have the already amazing customizing tools of LBP and the 2.5D view to have the rooms in.

I also like the idea of cutting down a version of the PS3. I’d say release a 20gb PS3 with some PSN arcade games on it already, cut out Wifi, take the power supply out and make a power brick like the 360, reduce the size of the console a bit, and sell it for $250 when the other price cuts happen. Sell the 80gb for $320 and the 160gb PS3 for $400

corndog

okay okay…I have managed to stop laughing. Now ‘my’ comment. I think the guy is trying to help but is not thinking it through with accuracy. If they release a PS3 without blu-ray that means it can’t read this ‘current and future blu-ray disks’. The best game on PS3 is already released on blu-ray MGS4. So for the next two years people will have to ask is that on dvd or blu-ray when trying to buy a new ps3 game. They will not be able to buy 99% of used games. The market will be fragmented and people will have to develop for a dvd and for blu-ray. Then they will look like fools when the price of manufacturing blu-ray does come near that of DVD. Like Carla said paying for ratings is wrong. And fruad. I will add one more thing to Carla awesome list. Make your best game developement tool’s AND engines availible for free to all developers with SUPPORT (I know you have to hire high paid people). This will help with the hurdle of developing on the PS3. ………..P.S. I still agree with McZero

xan

I would have bought a PS3 if they had kept the ability to play sp2 games. (like the short lived original PS3)

I normally stay away from Sony (since the music cd drm debacle) So its their loss, as they could have won me back.

Now I’m prod owner of a 360 and a Wii, but would have been happy just having the one PS3-2/Blu-ray instead.

Too bad, soo sad, Sony.

heavy rain

this is the most dumb article i have ever read.
sony has economics scholars that can tell them what to do, and not this RETARD of a poster.
if you are jobless, u better find someting diong, instead of anoying the general online population.
u re probably a high school graduate, u know no damn thing.
get a life dude!

corndog

Ivan_PSP said:
Without Blu-ray WTF are you restarted…I say….’ROFL’ I agree with Carla too…..I also agree with McZero…..ALL OF HIS POST’s LOL now this is laughing.

Dermot

i never comment on any articles i read online, but whomever wrote this article knows nothing ABOUT the console market or the playstation 3 themselves, its so stupid, im pissing myself laughing :)

McZero

Are you ducking retarded? All PS3 games use Blu Ray. What you’re suggesting is for sony to release the PS2. Which they did. I hoped you get raped.

Kevin Bebee

It’s a little deeper than what has been said here:

1. Price is higher than the competition.
•Sony stats that there’s all that “value” they are selling. To make an xbox has all the things a PS3 has is expensive. Wireless controllers, free online, built in sizable harddrive …etc. The base Xbox is cheap without these and they market this price over all others in the Xbox lineup. Whereas Sony doesn’t compare features and hopes that the consumer will figure it out. Good luck, the consumer sees the pricetag first.

2. MS has great development tools to make it easy to make games for the xbox. They pay companies for exclusive titles and DLC. They create that feel of “we have it and they don’t” by opening their wallet. Sony is depending on first party studios that have been sluggish to get games out the door. KillZone, LBP, GT5 and others should have been ready in year 1, not year 2,3,4.

3. Game quality…..this ties into #2. If the competition is easy to develop for and your ports are done as an afterthought, then your games will reflect that. Ever copied a document in a fax machine? It doesn’t look as good as the original print.

4. First party studios aren’t making games that truly show blueray’s advantage. By now, we should have had a few epic RPGs, games with TONS of HD movie content, etc………

5. Utilizing the PS2 base they already had. “Hey, we’re removing backwards compatibility so the 140 million ps2 users can’t buy us to us all those old games, that’s smart, right?” At minimum they should offer LOADS of ps1 and ps2 games on the PSN……..yet, they don’t.

josh

look. this year is the year (in my opinion) that sony will HAVE TO drop the psp. that thing had like 10 new games come out in 08 and thats just pathetic. sony was NOT READY at all to enter the handheld market, and the ps3 is just a giant psp. smae problems. bad games, bad ports, some good exclusives but the 360 has everything i need and MORE. and also like the psp, why buy movies that play on it when you can buy a dvd and watch it on anything!? dvds and blu rays dont look THAT different to make me wanna spend 30 bucks. screw that. sony basically shot themselves in the foot with the psp, thenshot themselves again with the ps3. then, dropped the 13 pound pos on their feet. their done. its over. and besides i think they should just drop out and go the way of sega. that would be wayyyyy better anyway.

Robert

“Sony should market several add-on packages to keep it current, especially against the Wii: A PS2-bundled with Eye Toy and other rhythm/motion game peripherals with new software, for example, and another bundle which adds wireless Internet connectivity, web browsing and downloadable content.”

Proof Editor is a retard. A big one at that.

So lets say that sony does implement this dumb ideal in the “next” ps2 console. First of all do you know that they would have to revamped the whole system, and now try to stuff in a Wi-Fi receiver in a console that already is small. Second, now they would have to release a whole new BIOS so they can support for the PS2, remember kids, there is no such thing as a firmware on the PS2. As for web browsing, you are browsing on a system with 32MB of RAM, that is as much RAM as the first generation of the PSP held, and look at it shitty internet configuration. As for downloadable content, yeah lets make the damn consumer buy a harddrive just so they can get confused as hell because they realized they have a whole new model number to work with. But hey, it should be possible if they have a external harddrive and a bit help from the internet. Lastly, downloadable content… again. As for games such as well, all of them that been released so far, you can say goodbye to downloadable content. The games were never made for you to have downloadable content. This is no… well in layman terms “Switch” to make the games all of a sudden to allow downloadable content in the games. This might be able to work if Sony were to release a few files of there own to allow this to happen, but would Sony really give a fuck? Who would give a fuck? This console is last generation. Let it die in the last generation. After all, why make a last generation console, add it with Wi-Fi and Downloadable content and call it a new PS2.

Oh yeah, this is only one of the dumb things you said in that …well what you say is a article.

miso

I don’t blame the writer, I blame the “developer friend” for not picking up on the “removing Blu-Ray” bit. However, I do blame the writer for not being up on Sony speculations of releasing a gutted version perhaps in March 2009 or more recently in Summer 2009.

All in all, I agree with the main point that Sony needs to react to realistic market conditions. By that, I mean our state of the economy and its cheaper competition. (Yes, I recognize that the Xbox360 isn’t really cheaper if you add in the peripherals, monthly XBL fees, and RROD, but the marketing has fooled most ppl as well as the press.)

With all that stated, I still believe that the PS3 is a good deal @ $399 (actually cheaper than competition with $150 off with SonyStyle credit card). It has a good library of games now that will get even better in 2009. Porting will get better as developers learn more about PS3 coding (has nothing to do with Sony, look at graphic & audio superior titles like MGS4). Online is free. Blu-Ray is good, esp if you have HD. PS3 is technologcally superior and more reliable than industry standards (2-3%). I’m very happy with my PS3.

Carla

=================== REASONS PS3 IS FAILING

…Few good games,

…Poor quality ports,

…Blu Ray movies too expensive,

…Poor resolution on games compared to XBOX

…Stop paying high advertising dollars for HIGh review scores, stop saying every game is a perfect 10 or 9.5. This is fraud which is why I rent everything now before I buy it……..

sony fan

wut they should do is lower the price of both systems or at least of the ps2 so people could get on to the ps2 and try later gettin a ps3 when that lowers its price

Michael

360 less lines of resolution on PS3 games that XBOX 360 on average?

Blu Ray to high at $30..

Movies not shot in HD (except for a few,,Apocolypto, Crank) dont really look any better than DVD, so to assume, that Im gonna run out and buy the same movie again that looks the same as DVD for $30 IS rediculous!!

Michael

You forgot good games..Yes MGS4 and Warhawk are great but they need many more if the want to succeed..

You forgot,, not releasing,, the bad ports that plague the PS3 system?? Make them good, not poor quality that says ,”hey dont buy it on the ps3 cause its always better on XBOX”..

Sachin Agarwal

Even though I run a gaming startup (Dawdle.com), I have no real horse in the console wars, although I own a PS3 and Wii.

To me, the best thing Sony can do is release a bundle with a 20GB PS3 (with BD), a copy of some *good* PG Sony Pictures movie, and a Greatest Hits version of LittleBigPlanet. Why a special version? Because I’d make a couple of changes to the game. One, the d-pad and left analog sticks need to be swapped. LBP is, at its heart, just a very pretty Mario game. The analog stick makes it *dramatically* more difficult for a non-gamer to play. Two, they need to allow multiple save files per account. Setting my sister up to start a new game took thirty minutes, as I couldn’t figure out how to “Manage Players”. LBP lends itself well to evangelism, but it’s too hard to do so. I’d like to see the price lowered to $299, and I think Sony could manage to make such a price breakeven by the end of 2009.

Europe had an LBP bundle this Christmas, and for the life of me, I don’t understand why the US didn’t. SCEE has been much smarter about reaching out to non-gamers: see Singstar. SCEA needs some clear thinking and fewer excuses. Blaming Sony Pictures for hamstringing the PlayStation 3 smacks of the US automakers blaming legacy costs. Make good product, market it well, and you’re done. Sony did the first, now it needs to do the second.

Michael

The PS2 and LBP points have some merit, but like previous comments said – the games use bluray discs and thier enhanced storage and bandwith for gameplay – not just for playback!

Sergey

you got it wrong. they cant go without blu-ray. all the games ARE BEING RELEASED AS BLU-RAY. EVERYTHING THEY HAVE FOR IT IS BLU-RAY. THEY DON’T MAKE DVD GAMES ANYMORE. THAT IS WHAT THEY HAVE. they’ll stick with it.

(sorry about caps. accidentally turned on.)

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