Sony’s grand strategy for a return to profitability and relevance in consumer electronics is finally becoming clearer, with games playing a central role. The announcement of the PS Vita TV last week represented a significant part of the comprehensive content and distribution strategy that will put Sony on a collision course with Apple, Google, Microsoft and Amazon. All of these giants are preparing to battle for the lion’s share of consumer hearts, minds and wallets in the future with a combination of hardware, software, services, and content. Sony’s PS Vita TV points to the way forward for Sony.
Pete Davison at USGamer summed up the PS Vita TV: “This 9,480 yen (just under $99) device is set to launch on November 14 in Japan (other regions are yet to be announced) and is, like the aforementioned Android microconsoles, a tiny little game-playing box that you connect up to your TV, then use with a wireless controller — in this case, the PlayStation 3’s familiar, comfortable DualShock 3. It features the same hardware guts as the Vita handheld (an ARM Cortex-A9 core processor and an IMG SGX543MP4+ GPU, for those who enjoy unmemorable strings of letters and numbers) which makes it — currently at least — one of the most powerful microconsoles on the market. It has 1GB of onboard storage and slots for both Vita game cards and memory cards, plus USB and Ethernet ports along with 802.11n Wi-Fi and Bluetooth 2.1 wireless capabilities. It outputs video at 480p, 720p or 1080i, and can even stream PS4 games to a different TV via Remote Play.”
At launch the PS Vita TV will support all downloadable PSP games along with PSone classics and select PS Vita titles, with over 1300 games available. Many of these games already have a serious fan base, and the PS Vita TV could unleash them on new markets. In Japan Sony will be streaming Netflix and other services, and you can bet on a full range of streaming music and video in other markets as well. It’s going to be tough competition for Roku and other inexpensive streaming boxes, as well as gaming consoles in the same price range.
The train of enthusiasm was derailed for a bit when SCE president and CEO Andrew House said the PS Vita TV is intended only for Asia, but Sony Studios boss Shuhei Yoshida quickly walked that back with the following tweet: “For people wondering about PS Vita TV outside Japan, we are just saying now ‘PS Vita TV releasing first in Japan’. Stay tuned.” It seems obvious that the PS Vita TV will eventually arrive in North America and Europe. The PS Vita TV sold out quickly at Amazon Japan.
Sony’s strategy brings together its successful history in games along with its music and movie divisions in the unified Sony Entertainment Network. While the execution of this still has its rough spots (as do all its competitors), the basic plan is to have appealing hardware at a variety of price points offering compelling content. Ideally, you’d have a single account where you can access your content any time, any place, on any device. Profits may not be high on the hardware itself in order to be competitive, but digital content margins should more than make up for that in the long run.
Sony’s hardware coverage will be pretty much complete with the PS Vita TV. With consoles, Sony will have the PS Vita TV at the low end ($99 to $150 with controller), the middle (PS3 at $199 to $249), and the high end (PS4 at $399). All of these devices will be used for game playing, movies, and music. When Gaikai’s technology is fully implemented, games from any source could be streamed to any device with very low latency. Sony’s got portable gaming covered with the PS Vita at $199 as well as its smartphones and tablets.
Outside of consoles, Sony’s lineup looks very appealing. Of course there’s the respected VAIO line of laptops, and now Sony’s gathering good reviews with its Xperia lines of Android smartphones and tablets. Now we see Sony bringing the best of Google TV apps with Bravia TV apps in the Bravia Smart Stick, which currently only works with late-model Bravia TVs — but that compatibility could easily be expanded later on (the product has not yet been formally announced or priced). Sony’s PlayStation Mobile initiative brings classic PlayStation games to a growing variety of Android devices.
Microsoft has been busy with its own comprehensive strategy for devices, content and services. The Xbox One is the flagship of this effort, and Microsoft has been busy adding substantial NFL support, original content (the new Halo series) and a variety of media features for augmented TV viewing. Microsoft is now manufacturing tablets with the Surface line (initial models flopped, but new models are coming September 23rd) and smartphones with its Nokia acquisition. Microsoft has also toyed with the idea of a set-top box and a small Surface tablet. So its hardware lineup may get even broader.
Meanwhile, Google continues to press forward with new tablets and smartphones, and Google TV is represented through Android consoles like Ouya and SmartStick. Google Play has a solid lineup of music and video. Google’s strategy is somewhat different, as it seeks to expand its offerings in order to boost advertising, its primary moneymaker.
Rumors continue to swirl that Amazon is on the verge of introducing its own Android-based set-top box (perhaps to be called ‘Kindle TV’), with a heavy emphasis on gaming. Amazon will doubltess be introducing new versions of its best-selling Kindle Fire tablets soon, and they are rumored to be working on a smartphone as well. Amazon tends to keep its hardware prices low in order to maximize the reach of its enormous retail engine, which now includes very substantial music and video components (original video content coming soon).
Finally, there’s Apple’s recent introduction of the 64-bit A7 chip, which provides Xbox 360 level graphics in a smartphone. That may be overkill for a smartphone, but it would fit very nicely into an Apple TV, wouldn’t it Imagine Xbox 360 level power for $99 with all of Apple’s content behind it, including a vast array of games.
The battle is clearly going to be fought across multiple devices, with each of the big players hoping to get consumers locked into a specific ecosystem. The competition is already intense, and it’s only going to get hotter with billions of dollars at stake. Consumers will be the winners, as the vast war chests of huge companies are opened up to spend heavily on attracting, engaging and retaining consumers. The losers will be the smaller companies that aren’t able to make the right deals for content, or somehow find a market in the crevices between the massive efforts of megacorps.
The broad outlines of this battle are clear, and now it becomes a test of how well each company can execute its strategy, and how quickly. Can Sony smoothly integrate the Sony Entertainment Network across all these devices Can Microsoft bring some of the Xbox magic to tablets and smartphones Will Apple ever introduce an Apple TV with an app store Will Amazon really bring out a set-top box and perhaps a smartphone Can Google or Apple ever crack the content problem with cable TV providers This battle is going to be huge, and games are a central part of the fight.
