Playstation Corporate Strategy Updated… or Downgraded?

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Playstation Corporate Strategy Updated… or Downgraded?

Thu, Jun 26, 2008

Sony PlayStation boss Kazuo Hirai did a funny thing this morning -- after telling a Tokyo audience of investors and businessmen that the PlayStation 3's success solidly stems from positioning the device "first and foremost as a gaming platform," he spent the rest of his presentation at the Sony Group Corporate Strategy Update explaining how the electronics giant plans to push non-game content on users in fiscal year 2008.

Following presentations by Sony CEO Howard Stringer and Ryoji Chubachi, President of Electronics, Hirai opened his own by citing the success of the PlayStation brand:

I have mentioned on many previous occasions that the Playstation space lies in gaming. True, we had a difficult time with the launch of PlayStation 3, but by refocusing the positioning of PS3 first and foremost as a gaming platform, we were able to bring in an attractive title lineup and achieve a sufficient number of PS3 sales...

By the numbers, PS3 sold 7.23 million units worldwide in the second half of fiscal 2007, fully doubling its sales year over year, while the PSP took a 9.18 million-unit leap forward. Not bad. The real success story for Sony, however, was Metal Gear Solid 4. Hirai revealed that MGS4 sold a full 3 million units within two weeks of its release, and spurred Japanese PS3 sales by a factor of 8 immediately following its debut.

Sony playstation business key drivers At this point, one might expect Hirai to cite a variety of games that will follow up on Metal Gear Solid 4's success; but he quickly dispelled such hopes with a vague statement about "True Generation" titles and proceeded to explain that in 2008, there are two key drivers that will move the PlayStation business forward. Neither had to do with games:

One of the key drivers is non-game content and services, and needless to say the other key driver is the network. We now have a total of 50 million network-ready PS3 and PSP systems in the hands of users worldwide. To boost further installments, we will focus on these two key drivers more aggressively in fiscal year 08, and aim to expand the world of interactive content through game and non-game content…

That phrase, "non-game content," was used repeatedly throughout the rest of the presentation, as Hirai showed off PS3's long-awaited video download service (due to arrive in the U.S. this summer, full details at E3), PlayStation Home (still on track for open beta this Fall), PSP network services ("This year," PSP will be able to access PlayStation Store and the aforementioned video download service on the go) and the brand-new Life with PlayStation, a set of Wii Channel-like applications designed to provide news, weather, and advanced photo features. This last sounded rather neat...

Life with PlayStation proposes a new lifestyle for PS3. As many people turn on their TVs in the morning, when they wake up, users can turn on their PS3 to see the worldwide news in real time, or check weather and temperature of travel destinations thru Life with PlayStation... in the future, we'll build a system that can virtually present stored photos or movies according to recorded time and place, allowing users with their friends and family to enjoy them visually in chronological order.

...until we learned that it will be supported by in-game advertising.

Dynamic in-game advertising and charged downloadable content and services will also be offered in Life with Playstation providing the PlayStation 3 business with possibilities to expand further outside gaming.

And these in-game ads (courtesy of IGA) won't be limited to weather widgets, oh no -- Sony says they're "part of the new PS3 business," and there was an entire slide devoted to their existence:

Sony playstation business in game ads

Kaz says (via Sony translator):

A new advertising medium for PlayStation business is now available within games, by efficiently offering advertising spaces such as billboards and other ad spaces. Due to the nature of in-game ads, the ad and how it is displayed will differ by player and how the ad will be shown on the screen. The Cell within PS3 will easily calculate these views from the gross visible area and length of view, and calculate advertising fees.

Now I don't know about you, but I buy video game consoles because I want to play games... and if Sony is trying to convince me that the PS3 is a gaming platform worth even the loss-leading $400 it currently commands, selling my eyeballs to advertisers is a huge step in the wrong direction.

in-game ads, Kaz Hirai, Metal Gear Solid 4, mgs4, movie, playstation 3, PlayStation Home, PlayStation Network, PlayStation Store, Sony

This post was written by:

Sean Hollister - who has written 825 posts on GameCyte.

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1 Comments For This Post

Nael M. Says:
June 26th, 2008 at 10:48 pm
Never mind just advertising...but advertising for Step Brothers? What's next, a The Love Guru billboard?

2 Trackbacks For This Post

GameSpyte Lyte: We’ll Love Ya, Tomorrow | GameCyte Says:
June 27th, 2008 at 3:05 pm
[...] into a glorious new future in which the most powerful processor in the world will finally see its full potential unleashed: The Cell within PS3 will easily calculate [in-game advertising] views from the gross visible area [...]
E3 2008: Sony’s TV and Movie Service is Live Right Now | GameCyte Says:
July 15th, 2008 at 9:26 pm
[...] Hirai reminded us about it last month, but SCEA President Jack Tretton confirmed it this morning, at Sony’s 2008 E3 Press [...]

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