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Sony Exec Says Luxury Could Be PS3's Downfall
Via Next Generation, an interview with CEO of Sony Corporation Sir Howard Stringer on the site CEO Exchange. In the piece they report that Stringer has gone on record as saying the PS3's price may be its downfall. This is the first indication we've had from Sony's upper management that the console's price may just be too high. "Wii is a wonderful device, but has a different target audience. If we fail, it is because we positioned PS3 as the Mercedes of the videogame field. PS3 is after a different audience and it can be whatever it wants -- a home server, game device, even a computer." Relatedly, a Goldmann Sachs analyst has opined that a PS3 price cut could come this year. Assuming they drop the price by $100 or more, this might blunt the objections many have to the console's lofty pricetag.
Well, the Neo Geo was an extremely expensive machine for its time also. I would almost compare it with the PS3 in terms of features, price and era. Look how well it did. It had a rabid, but extremely small, fanbase. As long as Sony is confortable with that, then everything is dandy. Now granted, the console buying market has grown a lot since then. But still, of all the game fanatic friends I know, who have multiple consoles, only one had a Neo Geo.
Like it or not, the PS3 is always going to compete in the same exact market as the Wii and Xbox360. No matter what features they include with the system, how powerful they make it, what claims they make consumers will always consider it first and foremost a game console.
Anyone who wants a system that does more will buy a PC. The PS3 is built around a gaming console so it will never function adequately as a PC. Not to mention it wouldn't be compatible with anything on a PC. Those interested in a home theater want dedicated hardware. They don't want audio/visual performance compromised. So ultimately, while for what the PS3 offers it might not be a bad price, it's perceived by everyone as a game console. And in that regard it is overpriced.
Nintendo has clearly learned from their attempts to turn the NES into a home computer. They've focused on the entertainment aspect and are emphasizing gameplay. Microsoft is in a far better position to bridge the gap between PCs and consoles given their extensive experience with operating systems. Even then, Microsoft hasn't forced an overpowered system on the consumer. They're a lot more subtle.
Eventually, PCs and consoles might unite as a home entertainment appliance but that day is still a ways away. Sony tried to do too much too soon and now have put themselves in a very difficult position.
I expect Nintendo to gut Wii Sports from the Wii package as soon as Sony starts rattling the price cut sabre. Gets the system down to $200 and people can choose the game they want instead of Wii Sports. Either that or Nintendo starts bundling in a second remote + nunchuk to the existing console SKU and you have exactly the same effect. Could throw Wii Play in just for the hell of it. Value added software is always a good consumer enticement.
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That they consider the potential PS3 audience to be a different target audience from Nintendo's Wii.
They shot for luxury buyers - but the reality is that most console purchasers of PS2 were never luxury purchasers.
I know, I get targeted ads designed to appeal to me to buy fancy watches, suits, vacations, etc - all because I like to read the magazine Vanity Fair and run a Family Trust and have saved a lot of money - but they miss the market truth that I have never paid more than $35 for a watch, like most millionaires, and stay in inexpensive hotels when I travel.
Know your actual market - and don't destroy your existing one when you launch a new product.
-- Tigger warning: This post may contain tiggers! --
I don't understand why the parent post isn't getting modded up because it is right on the money. Luxury features are all well and good but it isn't a replacement for core functionality.
I haven't seen Mercedes talking up in-car DVD and six speaker audio as home entertainment systems or marketing in-dash navigation systems as portable GPS units. What they market is the DRIVE because they sell CARS. Yet these kinds of points keep getting brought up in defense of the PS3. Great, it runs Linux, plays Blu-Ray, let's me shop for music... now tell me how these things enhance my gaming experience.
This may actually reveal a bit of the developer reticence with respect to the PS3 -- trying to take advantage of the Cell architecture is a one-hit effort. That expense of that effort cannot be recovered in a port.
What I'm waiting for is for someone in the mainstream media to break from the "PS3 is the highest-performance console of this generation" talking points: I've yet to see evidence that this is actually true. It looks like hype of the same flavor as the PS1 polygon counts and the PS2 "supercomputer" status -- transparently false, yet never confronted as a lie.
Liberty you never use is liberty you lose.
What worries me most is that if I get something for the 360, I'd be afraid of it coming out for PC later on. I prefer PC games over the console ports due to the fact that the PC can get higher resolution and texture quality than the console versions. Maybe this is less the case now with the beefier consoles this generation. It's more a consumer perspective than a developer one. Of course developers are gonna like having the ability to port things from the 360 to the PC without as much work as a PS3 to PC port.
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See this is the problem that I have with the PS3. You have a 720p TV but your forced to watch it in 480p because 720p is apparently the red-headed stepchild of hi-def. Your essentially watching a DVD. You take a progressive DVD player and play the Casino Royale on DVD and then the one on Blu-Ray on PS3 on that 720p and it's the same experience.
It's stuff like this that is the actual downfall of the PS3. If it can "do anything it wants" why can't it "want" to take advantage of different hi-def standards?
I went to Best Buy and the kid working there was basicly trying to sell me on PS3 (a fanboy trying to recruit is what it felt like) and I asked him why pay for something that doesn't have exclusives like once before and has quite honestly the worse library of games out of the big three. His answer was, "Don't think of it as a game console, but more like a Blu Ray player that also does games."
"So it comes with a controller this time for movies?"
"Uh...no but you can use the wireless game controller for movies."
Once Sony comes back to earth and starts thinking about fundamentals I look at buying a PS3 then.
But can you get a decent gaming computer, keyboard, mouse, and video cables for $600? (For example, the base model Mac mini with SDTV output is $620 plus shipping.) And how well does the computer's preinstalled GUI work on standard-definition composite video? And how many players per computer do typical computer games support?