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Hirai: New PS3 Represents Return To Roots For PlayStation
Hirai: New PS3 Represents Return To Roots For PlayStation
August 24, 2009 | By Kris Graft

August 24, 2009 | By Kris Graft
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    13 comments
More: Console/PC



Sony Computer Entertainment chief Kaz Hirai sees a bright future for PlayStation 3, and with the new revamped hardware, he hopes for a renewed spirit in the former market-leading gaming brand.

"We wanted to make sure that we set a new direction for the PS3," he told the UK's Times newspaper. "The PS logo with the capital P and small S has always been our logo, has always been synonymous with video games and I wanted to reset the thinking."

He continued, "Also internally I wanted to send the message internally that we are resetting the thinking, going back to our roots. What better way to do it than by resetting the logo? That puts the entire organization on its toes. On a practical level, when you have PlayStation 3 spelled out, the aspect ratio was such that if you wanted it on a billboard it became tiny. It didn't work in terms of visibility."

Hirai also said that the new $299 PS3 hardware will still be sold at a loss, continuing the "razor and razorblades" business model in which hardware is sold for a loss, while the money is made on software.

"If you're just talking about the hardware alone, the quick answer is yes," he said when asked if Sony takes a hit on the new hardware. "That makes good headlines, but I don't actually know that that's the true nature of the business that we're all in, whether it's PlayStation, Xbox or the Wii."

"I think the better indicator is to look at the business as a whole platform, to ask: are you profitable in terms of the hardware, software and peripherals. And the answer to that question is yes on a gross profit level since the last fiscal year."

Hirai also expressed no regrets in packing so much technology into the PS3. The inclusion of Blu-ray ultimately led to the high cost of the console at launch, causing problems for the PS3 in the face of cheaper rivals.

"Had we done less, I think we'd have gotten into a situation where, especially with the way technology ramps up, it would have been very difficult for us to embark on a 10-year life cycle with this particular console," Hirai said.

He added that PS3 installed base growth is "slower than the PS2 was but it's pretty much on track with the growth that we had with the original PlayStation."

Sony still manages to sell a surprising amount of PS2s, despite the fact that the console is nearly a decade old. The PS2 has sold 138 million units to date. The original PlayStation sold 102 million units.


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Comments


Thomas Ragan
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How can PS3 compete with wii or the 360 compete with the Wii.

Duong Nguyen
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It's all relative. The loss now could be 1/10 of what they were losing per PS3 before. Given that anyone who purchases a PS3 will most likely buy games for it, Sony makes a profit per purchased game/service. The question really becomes how many games or services do they need to sale to the user to break even or make a profit per PS3?



Sony is diversified enough to survive this economic crisis, they have their electronics, media, software and basic research divisions which they can spin off piece meal if they really needed to come up with cash fast, which I don't see happening unless the economic crisis drags on for another year or so.



Even then I doubt they would ever get to such dire straits as the Japanese govt. would bail them out because they consider the industry strategically important, like how we bailed out the auto industry.



-ddn

gren ideer
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Wow, Derek! How'd you pack so much doom into one post?

Kale Menges
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"Back to roots", huh? You mean batteries and CD players? Until Sony does something about the over-complicated and convoluted dev environment on the PS3, they are not going to regain anything. The machine's unconventional memory architecture is holding it back more than the retail price. Make the machine more efficient for developers to create games on and then we can talk about "getting back to roots".

Jorge Garcia Celorio
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Sure, the hardware architecture of the PS3 may be a nightmare for some developers; however, as long as Sony produces good games and new IP (I have no doubt of that, due to the impressive arsenal of first-party developers it has), the Playstation brand will always be on its roots :)

Jorge Garcia Celorio
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Moreover... now the big question is... is Sony going to change the game covers as well?? According to "marketing purists", in order to have a well-integrated marketing strategy, the use of a corporate logo has to be homogeneous in every product offered. I personally like the covers since the "Only on Playstation" motto appeared

Stephen Northcott
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Dear Sony,



Invest some time in making the SDK more accessible. You'd be surprised who might pick one up and start playing with it if it was.. You really don't need these hulking Dev. Kits for the PSP or the PS3.

You could even call it SDKLite. ;-)



You can still control which products get launched, and you might find that doing that alongside the PSP's slightly more open approach to Devs. would pay dividends...



If you truly have a 10 year plan for this piece of hardware then getting smaller Devs on board now is worth investing some time in.... When the PS3 is selling in it's next incarnation, like the miniscule PS2s, you'll have a bunch of smaller studios pushing out mature software much like some of the awesome stuff that hit the PS2 towards the end of it's mainstream life.



Just a thought.

Dave Foster
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One thing is true about Sony; they have diversified their assets and maintain their loyal customer base through the quality of their products. The higher price tag one often sees on Sony products is, paradoxically, as much of deterrence to a potential buyer as it is an assurance of the hardware itself.



Case in point: The price of the original PS3 may have seemed steep, but compared to what was offered with the original 360 - as far as quality is concerned - the winner is clear. The red ring of death has claimed many more dollars from those who just happened to be outside of their warranty, for repairs, or replacement systems that would just repeat the process given another yearís time.



This is partly the reason why PS2 sales continue to rise, because of the companyís continuing attention hardware improvement - - not just hardware movement. This type of corporate model allows those of us who owned the original PS2 (the big fat guy of the last generation, who could play DVDs but didnít have a hard drive) a little bit of retrospective understanding (a few years after it stopped reading game discs for no reason and we threw it out a window) towards our console provider. Now we can see that not only has Sony learned from its mistakes, Sony corrects them. PS2 slimís improvements over the older model are a clear mark of this, and now with the new PS3 we see the trend of improvement continue.



One clear difference, however, in this narrative of console improvement, is that the original PS3 is in some ways the best of the three, being that it is backwards compatible, and with an aftermarket 500 gig 2.5 drive, and an open source operating system, nothing else out there can touch it. Yes itís loud, and it gets a little hot, and of course thereís no Wi-Fi built in, but the thing chugs along and for whatever reason seems relatively un-kill-able - in stark contrast to the only other 1080p system out there.



I havenít really mentioned Nintendo in all this, but thatís because itís a non-issue. I just donít even think the Wii is on the same field with these other two. I have one, but I donít play it anymore - - ever since I got the PS3. As far as Iím concerned the average consumer is going to see either $250 or $299, and then figure that a Blue Ray player will probably go nice with their brand new flat screen and the debate will be over, at least between the Wii and PS3.



That is of course providing that they didnít buy a Westinghouse, which would probably be great fit for a brand new $199 360 - - which, after a year or so of subscription style xbox live and a couple post warranty fixes, might just equal out to a starter Bravia set and the new PS3, that for all intents, might just last longer than you want it to.

Mike Lopez
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If they are re-positioning their logo they are re-branding the brand and the question for me is what is it being branded into. It seems to me to be an attempt at psychological re-branding aimed towards consumer and press to try to convince them that the launch to date business is in the past and now things are completely different but actions will speak a lot louder than logos.

John Mason
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As an admirer of what Sony's done for the industry, myself-and so many others-genuinely want to see them bounce back and recover from the initial sloppy start of the PS3....and they've made up a lot of ground so far, imho. Sorry to say it Ken Kutaragi, but ever since you left the corporate bs. and 'rise to feet for we are superior to you meek sheep' attitude took a nosedive; it still took a while for it to die down completely and it wasn't until around the back half of '08 when I noticed "Hey?!? Sony PR aren't saying such dumb bravado and machoistic quoates anymore! Awesome!!!". This to me has helped given their public image a facelift, and of course the path going from facelift to full body makeover continues w/ the release of the PSlim3 (or, not getting fancy about it, the PS3 Slim ;). While I personally find the aesthetics of the original PS3 model more appealing (disregarding the George Foreman hull it's innards are contained in), the Slim *is* cheaper, bound to be more efficient in running tasks w/o building up as much heat, and....well it's cheaper, that's the main selling point isn't it xD?!? But I disgress; Sony wants to look at the PSlim3 as a chance to rebrand themselves, in the hopes of getting the numbers they desire...and it certainly looks like the opportunity's there to do that.



Even so, there's still other factors they need to take into consideration. Stephen Norchott and Kale Menges both brought up an interesting point that both possibly sheds light on the *real* source of much of the PS3's woes, and a solution that could fix them. If the problem is stemming from the development community, and as such the complications in PS3 development are preventing them from committing to the platform en masse (hearing various developer frustration in interviews here and at other sites over the years, I wouldn't discredit that idea), then a price drop really won't do much. Granted, if sales grow astronomically-to the point where they begin putting PS3 on the fast track to outselling the 360-then the developers could very well force themselves to put up w/ the development hurdles the programming environment provides, just b/c "hey, it's the star platform. It's where the people are, and it's where the money's at."



But that's an extreme expectation. Let's be realistic here, and say that the sales will just be impressive, but not groundbreaking; that alone may not be enough for developers to bother. It's sort of like band-aiding the problem rather than fixing it at it's core, and though many would say "Price cuts ALWAYS work!!", I say look at how that helped Sega w/ the 32X and Saturn; those platforms underwent drastic price reductions in small time frames, and yet neither sold particularly well, atleast in the Western market (in Saturn's case). It all came back to the development environment; developers didn't see the ease, and felt system sales and marketshare wasn't enough to justify their putting up w/ the environment if they didn't have to (i.e they weren't going to lose much sales for not putting out on the platform, so it's expendable).



Also keep in mind that a price cut-though having the ability to boost sales temporarily-would only keep that momentum going if customers, for each time they went to the store for a new purchase, *noticed* they had a stable of new and growing selection of games to choose from. I'm thinking of the more "casual" customer, who would make a trip maybe once every few weeks or a month at a time, and also under assumption that game releases would occur more or less on time from original annoucement. Notedly, the customer would initially be more consumed w/ the current offerings, of which there are quite a lot. However, if months go at a time and they come back, and the majority of their picks are still those same initial offerings, they'll start to notice the platform may not be getting much support. That "support"-unbeknowest to them-would not be there b/c the developers creating the games *still* aren't there, even after the price cut and initial surge in sales for the platform. More time goes by and the offerings are still mroe or less the same batch, so guess what?!? Sales will drop; the platform may be cheaper, but customers don't have much to choose from; they're noticing the release stream has stagnated.



So, like Stephen above me said, it'd be in Sony's best interests for *long term* prosperity to introduce a different SDK; one that'd allow developers easier paths to tap into the system's strengths, b/c it's got a *lot* of power in there. While at it, they should design the SDK in a fashion that'd lead to lower budgets for working on the platform, atleast in a programming sense (EA'll still likely spend millions for top-Hollywood talent in the next Need For Speed, but that's their problem and choice ;). If they can do that, then they stand a long term chance at performing big.



Of course, I'd also consider taking Dave Foster's suggestion on the original line of PS3s if I were a big playmaker at Sony; more specifically, I'd consider bringing back the open-platform OS of those models, to the PSlim3, but that probably isn't going to happen. I'm not even sure how much in favor Sony is in having an open-source OS in their main console xD. But all around, sound suggestions from all, and hopefully someone at Sony is reading all of our posts and taking these points into heavy consideration; we all just want a strong Sony again.

Bob Stevens
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'Until Sony does something about the over-complicated and convoluted dev environment on the PS3, they are not going to regain anything. The machine's unconventional memory architecture is holding it back more than the retail price. Make the machine more efficient for developers to create games on and then we can talk about "getting back to roots".'



How, exactly, do you suggest that they do this? They have been consistently improving the development environment over the console's lifespan, but they can't magically change the hardware around.

Duong Nguyen
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Yeah programming for the PS3 is a pain in the butt, no question. Sony sees it as a market differentiator, letting developers explore the full potential of the machine over the course of their 10 year plan. However half way down their 10 year plan there will be multicore chips from Intel and AMD which will rival or beat the Cell in ever way (Larabee, etc..) and GPUs which will be 2-8x more powerful than the PS3. Can they really compete with the next generation Xbox using that technology? But then again this might be the last hardware console generation, with the advent of interactive streaming media applications (OnLive,etc..).

gaz mad
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"Make the machine more efficient for developers to create games on and then we can talk about "getting back to roots".



Developers finding it challenging has always been the way for development on Playstation hardware, so don't know what your on about?

Developers are unerstanding the hardware now, and good developers like a challenge. They just don't put the effort in when its easy to do.



I'm glad there was a blu-ray player built into PS3 from the start. Yes it made it more expensive, but if it hadn't been in there, but the PS3 was cheaper. I would still need to go out and buy a stand-alone blu-ray player to watch HD. That would be more expensive to buy both the console and player, also more space is taken up. Good move on SOny's part, and now we have a very affordable console with blu-ray, the other consoles are too expensive for what you get in the box.


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