Sony has bet its PlayStation 3 (PS3) fortunes on some 380 new games coming to store shelves in 2008 Kaz Hirai reportedly told just over 7,000 shareholders Thursday at the company’s 90th annual shareholder meeting held in Tokyo.
The PS3 maker believes the new titles will boost sales of the next-generation console, according to reports. The PS3 has trailed both Nintendo’s Wii and the Microsoft Xbox 360 gaming platforms since its November 2006 launch.
On the Way
PS3 owners and wannabes can look forward to a variety of titles by March 2008. More than 200 of the games slated for release in the coming months are packaged software titles, with more than 180 additional titles set for launch via the Internet, Sony CEO Howard Stringer told reporters.
“The titles are the usual stuff,” Michael Pachter, a Wedbush Morgan analyst, told TechNewsWorld. “‘Madden NFL,’ ‘Tony Hawk,’ [‘WWE SmackDown! vs. RAW 2007,’ ‘Grand Theft Auto IV,’] ‘FIFA,’ [but] nothing special other than ‘Lair and Haze.'”
With nearly 400 games hitting the market next year, David Hodgson, gaming guide author, told TechNewsWorld that Sony is doing what any typical giant console maker will do in a good year. “We’re about to see one for Sony, software-wise, just like we did with the [Xbox] 360 this past year. This additional choice, and welcome return of certain Sony-only franchises and other multiplatform greats, means the consumer who doesn’t just want a Blu-ray player can now look forward to actual games.”
The online games portion, Hodgson predicted, will include previously-released titles for earlier systems such as the original PlayStation. “Some this stuff isn’t unique — just how you can play it,” he said.
Sony, according to a May announcement, will release first-party PS3 titles including “Warhawk,” “Uncharted: Drake’s Fortune,” “SOCOM: Confrontation,” “Heavenly Sword,” “Ratchet & Clank Future: Tools of Destruction,” “Folklore,” “The Eye of Judgement,” and “SingStar.”
The console will also benefit from the sale of some 16 exclusive titles such as “Syphon Filter: Logan’s Shadow,” “God of War: Chains of Olympus” and “SOCOM: U.S. Navy SEALs Tactical Strike.”
Playing the Game
The games may add needed assistance to the PS3 platform. With Sony’s game unit posting an operating loss of nearly US$2 billion dollars for the year ending in March 2007, one of the largest problems facing the console is a lack of must-have titles.
Since its launch in November 2006, Nintendo’s Wii has consistently trounced the competition in the U.S., according to sales figures released by research firm NPD. The family-friendly console has outsold the Xbox 360 and the PS3 in May with just under 340,000 sales. The Xbox 360 logged in a little less than 155,000 units sold and the PS3 trailed with a just over 81,000 consoles sold.
In the seven months since the PS3 and Wii were released, Nintendo has an installed base of 2.8 million gamers while the PS3 trails by 50 percent with only 1.4 million. The Xbox 360, released a year earlier in 2005, leads the next-generation consoles with 5.6 million units in the hands of gamers.
In terms of video games, among the top 10 for the month of May, the Wii’s “Mario Party 8” came in No. 1, followed by “Spider-Man 3” for the PS2 and “Wii Play” to round out the top 3. The Xbox 360 held positions four through seven with “Forza Motorsport 2,” “Guitar Hero 2,” “Spider-Man 3” and “Command & Conquer 3.” The PS2’s “Guitar Hero 2” was No. 8, with “Super Paper Mario” and “The Legend of Zelda,” both on the Wii, wrapping up the top 10.
Aside from the two PS2 games, not a single Sony title made the list.
Quality Not Quantity
Though Sony’s plan to expand its PS3 catalog by some 380 games is a good thing, the trick is to make sure that the games are of sufficient quality that people will pay the $600 needed to first purchase the console, Mike Goodman, a Yankee Group analyst, told TechNewsWorld.
“They are certainly putting a lot of games onto the market, and that’s a good thing because ultimately it’s software that sells,” he explained. “But in the end it comes down to quality, not necessarily quantity.
“You can put four games onto the market, and if they are the right four games it won’t matter. If they are a 4 or 5 million seller, you don’t need 100 games,” Goodman added.
The console market, Goodman noted, is a hit-driven business, so it can be argued that the more games put into the market, the odds improve that there will be successful hits that will drive the marketplace. Putting more games into the market place also creates a library of titles that will appeal to a broader spectrum of individuals. “Sony’s base has been fairly broad, so you need a broad range of games to appeal to them.”
The Cost of High Prices
Sony’s fundamental problem has been twofold, Goodman asserted. “Certainly there has been a lack of games, but the biggest problem is the price.” While there has been some talk from Sony about a PS3 price change, Sony spokesperson Dave Karraker told TechNewsWorld the company has no plans lower the unit’s price.
However, Sony would do well to drop the price by about $200, said Goodman. “Sony does not have a choice in the matter. In general when it comes to price cuts in the marketplace, it’s a game of chicken. But in my opinion, Sony does not have the luxury of playing chicken.”
Sony is playing from a position of weakness, not strength, he noted. “They lose the opportunity to hold onto their price for [the] longest period of time. If they were the sale leader they could do that. When you are the laggard you don’t have that ability. Price is one of the big levers you have to pull to stimulate demand.
“380 games is all well and good, but if the unit is still being priced at $600 it’s not going to make a huge difference,” he added.
Sony and price cuts, Hodgson said, will not happen until at least next year if they follow the same path they took with the PS1 and PS2. However, he believes that the current lack of decent software has hurt the game maker the most. Sony’s games need to be engrossing, long-lasting and worth the additional $10 Sony — and Microsoft — seem to think consumers are willing to pay for their games.
If Sony wanted to shake up the market, short of cutting the price on the PS3 console, Hodgson suggested, the company may want to price all new PS3 games at $5 less than those for the Xbox 360 and force Microsoft’s hand.
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