RSSKutaragi: Sony Hardware 'In Decline'
By Scott M. Fulton, III | Published September 8, 2006, 11:58 AM
In an extraordinary public statement of regret and despair over having to postpone his company's PlayStation 3 debut in Europe and Australia until March, and to limit availability elsewhere to only 500,000 units come November, Sony Computer Entertainment President Ken Kutaragi is quoted by Reuters as having told reporters, "If you asked me if Sony's strength in hardware was in decline, right now I guess I would have to say that might be true."
Kutaragi's comments come as his company struggles to reassure customers in North America and Japan that there's still something to look forward to before the holidays. Sony senior corporate communications director Dave Karraker reassured BetaNews this week that November 17 continues to be the PS3's North American launch date, although only an estimated 400,000 units will have shipped to retailers here by that date.
Back when Microsoft was criticized for having underestimated Xbox 360 demand during last year's Christmas season, the company still reported having sold 600,000 units in the United States between last November and January.
Financial analysts are mixed about whether this setback will result in permanent damage for Sony. Some are saying this week that game console consumers will simply delay their purchases for as long as Sony pushes back the PS3. The theory is that PS3s are already "sold" to the majority of customers - if they're going to buy it, they've already made up their minds to do so.
But others are citing the fact that the PS3 is supposed to double as an entry-level Blu-ray Disc player, by way of concluding this could be a calamitous turn of events for Sony. Consumers in the high-definition media space have yet to make up their minds as to whether HD DVD -- whose players and movies were released first -- or Blu-ray will provide the better overall experience.
Many of those consumers are believed to have been waiting until November to make up their minds. If they can't actually get their hands on a PS3 because it hasn't shipped, or has been put on back-order, some believe they could purchase a Toshiba HD DVD player for Christmas instead - or perhaps even an Xbox 360 with an HD DVD player attachment, if Microsoft manages to make that add-on component available before the holidays.
After news of the PS3 delay hit Japan, it precipitated the biggest single-day drop in the Nikkei average in one month, falling 1.67% yesterday and continuing its decline today. On the New York exchange, Sony stock had been trading lower, but had started a rebound by lunchtime Friday.
Blue Ray is not substantially better than DVD sorry folks. I'm not going to be using the Blue Ray on the PS3 to backup my computer hardware so it's fairly useless, not planning on replacing my extensive DVD collection either. This is the same reason HDVD will fail. I predict these two formats 1) don't offer enough to warrant the price 2) DVD is not dead "far from it" it's cheaper than ever! Remember the days when we used "Rewind" DVD was far superior and that can’t be said of the new formats which have marginally better video. When benefits are greater for producers than consumers it’s at a bad starting point. UMD or DivX? How about HDMI connectors designed to prevent copying… Do you get excited about new DRM? I don’t even backup my DVDs now but I’m glad if I want to I can without taking a loss in quality and movie companies hate that!
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I would say game play and controller action is better with Sony. I really do not like the controllers with Xbox. Also the game play is not that great and feels more like a PC game. But lets get down to reality....
Lets talk CHINA :-) From a manufacturing perspective Xbox cost much less to build. Many of the components come from factories in China. The moldings all come from China. The majority of the assembly work is in China and Thailand. I bet many people did not even know that. Playstation is assembled in Japan for the most part. Many of the parts come from Japan such as the moldings and many of the capacitors, mother-board, etc. I know Sony has a few parts manufactured in China. Point is if I were going to build a game system I would focus on making a system based off of existing technology.
For example build a game platform with dual-processors, 1 or 2 gig of memory, cooling system, 200 gig+ hard-drive with 10 gig flash-drive. Have some plug-in components, etc. Allow specific upgradeable component interfaces like USB, DVD, network Card(wireless or RJ)etc. I bet you could manufacture this for about $250 per box. The profit can mostly come from licensing the game technology to publishing companies, etc.
I think it is a complete joke that these companies make this so difficult. Get a friggin office in Guangzhou China and $1 million USD for manufacturing and $1 million for marketing and I bet my life you could have a game system that is smaller, faster, cost-less to manufacture, and allows incredible extendable component possibilities. For example have slide out components such as DVD-Drives so you could have other manufactures such as...the next best technology! Seagate Technologies will sell 200-GIG drives at about $60 a piece if you buy 200,000+ drives in a order. Mother Boards are about $50,000 to build a demo in San Jose Ca. and then take to China and mass produce. CPU's, etc. are like $30 a piece with 200,000+ orders and now with new cooling systems like "Arcon-Cooling Plates" ($50 a piece at 200,000 units).
Wireless network cards are like $8 USD a piece at 200,000 Units....
If we made a system that allowed other manufactures to participate and create component add-ons’, and just focus on low cost and licensing the game rights we (we being the community) could create the best (faster, cheaper, better gaming experience) game system on the market!
My point is I would love to see some entrepreneur stick their money where there mouth is and lets build a bad assssss system with a kick a** marketing and licensing plan!
I am American living in China and have helped numerous companies build mp3 players, cell phones, pda systems, etc. I just helped a company recently create a hand-held computer system twice the size of Sony portable game player.
It actually pisses me off to no end that no one will step up and build something cool!
Compared to what is possible Xbox is slow as honey in freezing weather! The Sony system is dead as far as a business model....
Sorry ranting....
Anyone have an extra $2 million USD? Lets build the ULTIMATE game system! I even know the best coders in the world! That left Microsoft :-) We build a demo run with 500 units then go for the big bang! To manufacture 200,000 units you will need to factor 70% of your total amount of money needed. The remaining money can be used to spur the development of 50 games @ $10 million for intial development. I bet with some creative financing and thinking you could easily get this system ROCKIN! Bye this time 2007. Of course the obvious implications are attach a keyboard and have a monthly service plan and you have your own ISP, hell you could even add a subscription TV-Show system where all your favorite TV shows auto download to your system! Like Torrent but legal…. The potential is endless :-)
Hehehe okay Im dreaming maybe a little :-) But I bet someone with some deep pockets and vision could build the ultimate system!
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I used to be a great fan of Sony - remember the original Walkman? The first portable CD player? Betamax? Great company....but after my experience with a Clie (even before their rootkit problem), I refuse to have anything to do with Sony anymore.
My problem is their proprietary approach coupled with the ir complete absense of an upgrade path. Sony makes beautiful products but when you buy something from them, you have no hope of them continuing to support it after the next version of that product comes out, typically 6 months later. So for example, I bought a Clie when it first came out, hoping they would add support for Wifi through a card later on. But what did they do? They released a NEW device with WiFi and that was the end of it. Perhaps it's no surprise that they no longer sell Clie.
Bye Sony, you will not be missed.
P.S. (Sadly, the problem with my diatribe above is that my kids insist on having PlayStations and PSPs)
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my 2 cents... im an A/V installer.. and just from what ive seen.. HDDVD looks and sounds better than the BluRay players ive installed.. and there half the price..
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I am glad they admitted it. I hated Sony and will never buy their products. They treat their customers like crap. They have the nerve to tell you if you don't like the price of our products go elsewhere.
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That doesn't bother me so much - the "market" will simply decide whether the product is worth the price, regardless of what "they" tell you.
--->They have the nerve to tell you if you don't like the price of our products go elsewhere.
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Ive heard far too many arguements regarding which console will reign supreme, and to be honest does it really matter. All the manufacturers are doing is ramping up a loyal user base for the next one they do, then milk it with the games. Sony looked to be on a cert, sega thought so also, nintendo also would like another pop, atari .... well they fluffed it i think :P.
To say microsoft are the industry bad boys they have done well to get where they are, and sony are helping them. Missing a huge Xmas market will mean people will buy the Xbox or nintendo console to put under the tree, and cant see them explaining the the wife n kids thats its better to wait, it aint going to happen. The fan boys will wait, or pay through the nose to get one. Dont forget these are the same people buying Ipods, they dont care so long as Xmas isnt a FLOP and if they cant get a sony then anything is better than nothing.
I think nintendo is going to hurt sony in the jap market, they love the nintendo game model, but of course the sony will sell also.
Ultimatly its the games thats going to sell and earn the money, and to be honest theres allot of catching up to do. Anyone wondering what console to buy and goes into a games store to see the games cant help to notice which games shelf is the biggest when they look at MS, Sony and the nintedo shelfs.
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I have been following the PS3 Saga for the longest now, and i can honestly say that SONY being presassured to live up to their reputation to be the electronics'cutting edge pioneers have pushed their capacity way to far. PlaySations have dominated the vidio gaming arena for the longes time. Now with the hardcore competion form Microsoft, and a serious upgrade to Nintendo...I can see that maybe the company's top management created a vision and set a goal that the company as a whole (infrastructure and managerial wise) is not capable to deliver. This is just a classic case of market leaders trying to maximize their profit by pushing its core competencies...very typical and somehow entertaining...jeje.
Anyways, i guess we have way too hight expectations of Sony and its PS3, and i sure that when things are rushed...mediocracy shines.
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Alex said it perfect, to bad the only thing Sony cares about is money, not our comments or their products quality. The "limited availability" I might guess is to squeeze a extra $200-300 each unit from the parents able to afford it.
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If Sony only cared about Money, the the PS3 would have been launched a year ago, half baked.
They have resisted the temptation, gone with the original plan to make a quality killer console.
Microsoft are the money grabbers here. The XBox360 launch was brought forward to make Xmas 2006, features cut, half baked, poor reliability, just to make $$$$
Your arguments don't make sense.
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Nor do yours,Give us a break Mark! Sony is starting to die a slow painful death!
It' a beautiful thing, Boycott Sony!
Alex S. said it very well see below.
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I have to disagree.
Sony is about money - its called bluray. That's why the PS3 hasn't been released yet. Lets be 100% realistic. The PS3 is more about getting bluray out there than it is getting an amazing game console out there.
While there will be games that will make use of the large disc size, it is far from being required - multiple DVD's (considering the size of some games) would not be an issue in my opinion. If a game is going to take 30+ hours to win, I certainly don't see a problem with swapping at hour 15.
And in regards to MS rushing the 360, I disagre. Yes, there were problems, but there are in any launch (case in point is PS3 and this article) and I'm not aware of any features that were left out at launch. From day 1 up to the current time, 360 is a great gaming console.
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Give me a break guys. Are you saying if you were creating a new multimedia format you wouldn't include it in your video game console? It'd be stupid if Sony used some form of DVD if they're working on BluRay.
I'm with the next person when saying that the PS3 has had a really rocky start and it's not even out yet, but stop kicking it when you haven't even had the chance to watch bluray movies or play the games. I've followed the PS3 saga too and I can tell you that the delays that were faced with the PS3 were Sony trying to deliver on the promises of one of the most powerful game machines in the world. Yes blueray played a part, but oh well? If I can get a PS3 for 500$ with Bluray, it's pretty cheap when you think that the newly released bluray players are like a 1000$.
Next don't congratulate Microsoft for releasing their console early. They've done nothing to innovate in the gaming industry except improve the popularity of online console games. The console is more powerful but that's nothing we haven't seen before. And to be honest, i'm sick and tired of playing the same. old. sh!t. Need for Speed 30303 Madden 2050, I mean come on...Bring on the wireless motion sensing controllers(Nintendo) or introduce a new format and let me see another trailer of Final Fantasy XIII(Sony) but for god sakes don't stick a couple powerful chips in a machine, put together online software and call yourself #1(Microsoft).
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First - Sony.... Yes, it certainly does make sense to release it with BluRay, but if they could have released the console a year ago without, then I'd say no, its not worth it. I would have been more likely to consider the PS3 a year ago, but having been very happy with my Xbox, I stuck with MS having it out sooner and knowing it would have great online gameplay. I do not buy my consoles for movies. (Yes - it would be nice, but I can watch HDDVD on my 360 soon).
Second - MS - I am not congratulating them for releasing it early - merely on time with what they promised. I also think they do innovate. The whole online portion (gaming aside) is quite innovative, new and they way they did it is great. Downloadable content and purchasing extras for games is also great. So are achievements - all something they did first.
Then all the other features it has that helps make it a media console as well are pretty cool.
All that said, I am interested in seeing what PS3 has to offer, but I certainly won't be considering buying one anytime soon. 360 has great games and has had them for the past year..
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I couldn't agree more, Alex. There was a time when Sony was the first brand I'd look for when making any electronic purchase, but those days are long gone. Now I make sure everything I buy is a product of a Sony competitor.
Crash and burn, Sony.
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No kidding, welcome to reality Ken. I used to love Sony, they once made great products. That hasn't been the case for quite some time now. They have overextended themselves, got into the music and movie industry where they had no business being and became paranoid DRM pushers while their hardware quality began to fall. Their arrogant attitude and wanting to own and control everything hasn't helped either. For example, drop the memory sticks already, the industry doesn't want them. Consumers don't want them. Stop using your market share in things like the console industry as a trojan horse to push new formats onto the market. Your greed has been your downfall.
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well said.
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Right on, Alex.
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very true.
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yeah i agree as well. i do own the sony dream machine, it's pretty and it doesn't push a format..... i think.
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Nicely said.
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Can't agree more. You are the man Alex! :)
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"And to be honest, i'm sick and tired of playing the same. old. sh!t. Need for Speed 30303 Madden 2050, I mean come on...Bring on the wireless motion sensing controllers(Nintendo) or introduce a new format and let me see another trailer of Final Fantasy XIII(Sony) but for god sakes don't stick a couple powerful chips in a machine, put together online software and call yourself #1(Microsoft). "
Absolutely couldn't resist commenting on this. You rip on Microsoft for more need for speed and madden sequels on the 360, then ASK FOR ANOTHER FINAL FANTASY TRAILER? You were kidding, right?
And sony is doing nothing to innovate with this generation either. Yet another proprietary sony format does not qualify as innovation. And calling a $500 PS3 cheap just because a bluray player costs $1000 is ridiculous. Now if a bluray player were actually WORTH $1000 for what it provides, this might be a different story.
Does sony pay you to be it's shill, or did you volunteer for that on your own?
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Yeah, "Madden 2050" and "Need for Speed 30303" are weak sauce, but a trailer for "Final Fantasy XIII"? Who'll take my preorder? What's Sony's big innovation here again?
The Wii may turn out to be cool, it may not, but in the meantime, what MS has done with XBL is the most significant innovation in console gaming in the past five years.
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Hey you all,
I have an Xbox 360 and I am going to buy the HD-DVD to go with it come x-mas. I am also looking forward to "Gears of War" and "Halo 3", but all the same I like the PS3 for the possibility of surfing the web from my TV. Too bad I can't use my 360 for that..
As a fan of Microsoft, I favour HD-DVD etc. over Blu-Ray and PS3, but all the same I feel sorry for Sony. I don't want them to bust. But I regreat to see all their stupid "we are best" comments. It is now time for Sony to be a little more humble. I don't want them to loose all to much to Nintendo and 360, even before the console war has started. -cause I am looking forward to see how this war plays out *lol*
May the best console win!!!
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"Now if a bluray player were actually WORTH $1000 for what it provides, this might be a different story."
Opinion right?
Next
"Absolutely couldn't resist commenting on this. You rip on Microsoft for more need for speed and madden sequels on the 360, then ASK FOR ANOTHER FINAL FANTASY TRAILER? You were kidding, right?"
If you paid enough attention to Final Fantasy you'd know they put together an entirely different game each time they make it. They keep some components, and change some but overall the story and atmosphere is 99% different. Madden, NFS is a rehash, rehash rehash rehash.
"Does sony pay you to be it's shill, or did you volunteer for that on your own?"
Sony pays me so much to say the things I do I'm rich. Like rip on Microsoft products rich, like don't form my opinion but post on message boards rich. I'm so rich i'm gonna buy a PS3 rich.
;-)
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