By Jay Lyman TechNewsWorld Part of the ECT News Network
03/23/06 1:51 PM PT
Sony has indicated that massive multi-player online game publishers will be able to provide their games via Sony's coming online service, but the Japanese giant has revealed little about its business model, according to Parks Associates Director of Broadband and Gaming Michael Cai.
Sony (NYSE: SNE) disclosed more about its next-generation Playstation 3 console, due at the end of the year, by outlining the company's vision for the product, which includes live, multi-player online play and even digital distribution of games through downloads.
However, much of Sony's strategy still lies in what will be. Meanwhile competitor Microsoft (Nasdaq: MSFT) is already providing its popular online play with Xbox 360 and Xbox Live, which came out late last year. The software giant and console competitor also indicated this week it is bumping up Xbox 360 production in an effort to meet the demand unmet by Sony, which confirmed a delay in the launch of the PS3 last week.
Microsoft may have a year's head start on Sony, but few doubt Sony will hit back hard with its PS3, which is expected to serve as a home media server as well, offering audio, video, pictures and connectivity in the family room.
PS3 Preview
Sony demonstrated the new PS3 console using developer kits and recent game titles at this week's Game Developers Conference (GDC) in San Jose, Calif. Last week, the company signaled that the PS3, which relies on new Cell processor and Blu-ray DVD technology, would not be released until November, despite earlier expectations of a launch this spring.
Sony President Phil Harrison's keynote at GDC -- complete with screens of digital fish swimming and aerial flying -- was "amazing," according to Parks Associates Director of Broadband and Gaming Michael Cai, who said the line for the talk went around the building.
"They're promising a lot," Cai told TechNewsWorld.
Harrison spoke of Sony's answer to Microsoft's Xbox Live online play, reinforcing the idea that Sony will be emulating Microsoft with its online efforts.
"A lot of the things [they discussed] Xbox is already doing and has innovated," Cai said. "Copycat or not, Sony has to do more in the online space. I think network gaming is the way of the future."
Meeting Demand
Sony has indicated that massive multi-player online game (MMOG) publishers will be able to provide their games via Sony's coming online service, but the Japanese giant has revealed little about its business model, according to Cai.
Meanwhile, news that Microsoft is increasing production of Xbox 360 consoles shows how committed that company is to taking advantage of its head start.
"There's still a lot of unmet demand, so if they can increase production, it may help them," Cai said.
Online Importance
There is no question Microsoft has a lead on Sony, but the latter has also had a chance to learn from Xbox Live and other online gaming services, and cannot be counted out by any stretch, Jupiter Research Vice President Michael Gartenberg reiterated to TechNewsWorld.
"One thing is clear, online gaming is not ancillary to gaming consoles, it's an integral part of consoles," he said. "We're going to see gamers have unparalleled opportunity for multi-player games online as well as distribution of games."
The strategy outlined by Sony and being carried out by Microsoft illustrates how, in addition to the hardware and software games, the competitors must focus on network operation for online play, Gartenberg added.
Microsoft, Epic Strike Deal for Music, Video Content for Xbox Live March 17, 2006
"This year will be a watershed for delivering to consumers an array of new entertainment experiences," said Kurt Scherf, vice president and principal analyst at Parks Associates. "Thanks to broadband proliferation and growing cooperation between content producers and other members of the digital entertainment value chain, we'll see significant product and service announcements throughout 2006."
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"If you have to delay, you better make it a big bang once it comes out," Michael Cai, director of broadband and gaming for Parks Associates, told TechNewsWorld. "If Sony is smart, I suspect they'll do that."
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Some in the gaming community believe the PS3 will be a superior device to the Xbox, DFC Research President David Cole said, and the additional functionality in the consoles is driving up the price. Most observers expect the PS3 to retail for around $500. "The devices are changing and users are becoming more discriminating along the way," Cole added.
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