Sony to Scrap Playstation?

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  • Argath
    $2 whore
    • Apr 2009
    • 9241

    [PS3] Sony to Scrap Playstation?



    Sony (NYSE: SNE) surprised the world this morning when it announced that it would pay $380 million to acquire Gaikai. The company plans to use Gaikai’s technology to build its own cloud gaming service.

    This announcement is a big win for the likes of Intel (NASDAQ: INTC) and Qualcomm (NASDAQ: QCOM), two of Gaikai’s investors. It is also a big win for Gaikai co-founder David Perry, who has repeatedly argued that streaming, free-to-play entertainment is the future of the game industry.

    But is it the future of Sony?

    At this year’s Electronic Entertainment Expo, Sony was accused of ignoring its latest game machine, PS Vita, which has been struggling at retail. While the handheld device experienced a small increase in sales in Japan last week, PS Vita has been unable to achieve any significant numbers. According to VG Chartz, the PlayStation Portable follow-up has sold a little over two million units worldwide since its release. (PS Vita was released in Japan last December and in the United States and Europe in February.)

    Retailing for $249.99 (Wi-Fi) and $299.99 (Wi-Fi/3G), PS Vita is currently the most expensive handheld gaming device available. The Nintendo 3DS (NTDOY) also retailed for $249 when it was released in March 2011, but sluggish sales forced Nintendo to lower the price a few months later. In the weeks and months that followed, sales greatly increased. Worldwide,more than 18 million consumers have purchased a Nintendo 3DS.

    Regardless, Sony is standing firm with its pricing model. Last month, Sony Worldwide Studios chief Shuhei Yoshida told Eurogamer that it was too soon for a price cut.

    Sony faced similar challenges when it released its first handheld gaming device, which also launched with an MSRP of $249.99. Up until that point, consumers were used to spending less on handheld game machines. But in an effort to provide a portable gaming experience that was on par with that of a home console, Sony built a more expensive device. This was acceptable to hardcore gamers who buy and play everything. But it did not go over so well with parents, who are used to buying inexpensive handhelds for their kids.

    Three years ago, Sony endured one of its most troubling hardware launches in company history when it released the PSP Go. Designed to be a thinner, lighter, download-only version of the original PSP, the PSP Go carried a $249 price tag. That price, the inability to play old PSP games without paying for new downloads, and a host of other issues kept the device from taking off at retail.

    In April 2011, Sony discontinued the PSP Go.

    When PlayStation 3 was released in November 2006, the company opined that it lost money on every unit sold. (Microsoft (NASDAQ: MSFT) did the same thing when Xbox 360 was released in 2005.) As of February 2010, PlayStation 3 was still a monetary loser.

    Sony is willing to take that loss, however, because of the greater good. By selling as many consoles as possible, Sony can grow the number of consumers who play (and purchase) its software. While hardware is very profitable for some corporations, console manufacturers tend to make the majority of their money from selling games.

    Now that Sony has purchased Gaikai, it could attempt to cut out the middleman (consoles) and bring games directly to consumers without requiring them to buy new devices. This would prevent Sony from having to endure another dreadful hardware launch.

    In May, the Wall Street Journal reported that Sony considered releasing a Web-based, disc-free console. The company abandoned those plans for unspecified reasons.
    Interesting.. this would coincide with rumors I've heard that Sony is abandoning the playstation name for their next generation console
  • ThomasTomasz
    • Nov 2024

    #2
    I think this article should have focused more on the Vita and the handheld gaming market. It was dying a slow death and I think it will pick up. I would be surprised if we had another Sony or Nintendo handheld. With the move to tablets and smaller laptops, gaming is much more portable then even five years ago. I'm certainly not spending money on a Vita with everything else that is out there.

    Comment

    • NAHSTE
      Probably owns the site
      • Feb 2009
      • 22233

      #3
      Been rocking with PlayStation since the original PSX days. T'would be a very sad day for me.

      Comment

      • dave
        Go the fuck outside
        • Oct 2008
        • 15492

        #4
        Vita had no chance vs. iPad. Bringing Vita to market was just corporate pride. Vita was dead before it started.
        My Twitch video link: http://www.twitch.tv/dave374000

        Twitch archived games link: http://www.twitch.tv/dave374000/profile/past_broadcasts

        Comment

        • Swarley
          A Special Kind of Cat
          • Jul 2010
          • 11213

          #5
          Scrap a very recognizable brand name like PlayStation?? I don't think so.

          Comment

          • BigBucs
            Unpretentious
            • May 2009
            • 12758

            #6
            Yea, wouldnt make much business since. Netflix was gonna try that shit and came to their senses.




            Comment

            • f16harm
              -
              • Feb 2009
              • 2183

              #7
              Originally posted by Argath
              http://www.forbes.com/sites/benzinga...g-playstation/



              Interesting.. this would coincide with rumors I've heard that Sony is abandoning the playstation name for their next generation console
              That would be a monumental mistake. Ask Chevy how it went when they renamed the Cavalier to the Cobalt a couple years ago in an attempt to change the cars image to a more "European" feeling. Even though the Cobalt was a next model version of the Cavalier, people like certain names because it allows them to immediately recognize with something, even if it's just for personal comfort in a name.

              Comment

              • Argath
                $2 whore
                • Apr 2009
                • 9241

                #8
                Still... a new version of the PS3 is supposed to come out a month after sony acquires this company? Could it be that "ps4" or "orbis" or whatever you want to call it games will be played on these new ps3 consoles?

                Comment

                • f16harm
                  -
                  • Feb 2009
                  • 2183

                  #9
                  Originally posted by amarant
                  Asking Ford about the Taurus is probably much more appropriate, since in the end Ford had to bring back the Taurus name.
                  Another good call, "Five Hundred" FTL. I think they sold about 17 of those cars.

                  Comment

                  • Swarley
                    A Special Kind of Cat
                    • Jul 2010
                    • 11213

                    #10
                    Originally posted by Argath
                    Still... a new version of the PS3 is supposed to come out a month after sony acquires this company? Could it be that "ps4" or "orbis" or whatever you want to call it games will be played on these new ps3 consoles?
                    No. More than likely these new PS3s are to milk whatever they can out of this last year or so of this generation's life. Also, they've probably come up with a more cost effective way to make the PS3, so why keep making the old one's that cost more to make.

                    Comment

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