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In-Depth: Sony's Koller Talks 50 Million PS2 Sales In North America

In-Depth: Sony's Koller Talks 50 Million PS2 Sales In North America Exclusive

January 14, 2009 | By Christian Nutt

January 14, 2009 | By Christian Nutt
More: Console/PC, Exclusive

If 2008 proved one thing, it's that the PlayStation 2 is still an important part of Sony's lineup. The system provided a nice financial cushion in the face of the money-gobbling PlayStation 3, with significant sales that saw it finish ahead of the Xbox 360 for much of the year.

Despite much higher revenue numbers for next-gen hardware and software, Nielsen data shows that gamers collectively spent more time with their PS2 than with nay other console.

And yesterday, Sony announced that the console has reached 50 million units sold in North America. On the day of the milestone, Gamasutra spoke to John Koller, director of hardware marketing at SCEA.

"It's a bit of a self-fulfilling prophecy; as it continues to sell, development continues, and consumers continue to buy," says Koller. "There's such a wide range of entertainment experiences available that I think it would be very difficult for people to complain, 'this console doesn't have anything that appeals to me'."

According to Koller, CEO Jack Tretton believes "the only way to kill the PS2 business is to stop supporting it." Though unwilling to reveal any key games, Koller says, "With the lineup for 2009 and 2010, the PS2 is not going away anytime soon."

Defining the Keys to Success

How does the success of the PS2 compare to the original PlayStation? Says Koller, "The PS1 was obviously very successful in its own right and did mid-30 millions... [But with the PS2] back in 2000, that was a time when we were able to garner a lot of software support as well as create the value in the box that consumers are really asking for."

According to Koller, the initial keys to the PS2's success, which laid the foundation for its continued sales, include the then-advanced technology in the box.

In addition, the system's "dual role" as a game console and DVD player, and its "incredible software lineup" helped birth a system which, by 2009, features over 1800 games in North America -- with 130 released in 2008.

2009: The PS2 Market Position

But as time has marched on from the system's October 2000 launch, "We've obviously had changes in who's purchased the system... as we've gone along we've had various demographics entering into the marketplace," Koller says.

Today, the PS2's core demographic is "young families and lower income play," says Koller. "I think right now we've really focused heavily on two particular types of gamers: the first being the social gamer, and the second being the sports gamer."

"We've made a lot of focus into the family-friendly type gaming environment," he adds, "and also being able to promote the overall value of the system to a lower income family."

"This could be a family that may have lapsed from gaming, or maybe is new to gaming and wants to provide to their children an entertainment value that really surpasses what they would get from a vacation or a dinner out in these tough economic times."

He noted: "We've been able to successfully target that demographic and have sales well into the ninth year of the life cycle."

How does it compare to the rest of SCEA's hardware lineup? "The PSP, from a handheld perspective, it's more of a 13-17 year old [demographic], multi-ethnic, a bit lower-income as well. The PS3 is still in its early adopter phase, tech-oriented consumer... they're interested in the multi-functionality of the system."

SCEA's Bottom Line: How Does PS2 Fit In?

Though Koller was unwilling to discuss specific numbers, Koller says that the PS2 is a "positive margin business, and a significant contributor for us."

When quizzed on how the PlayStation 2 contributes to SCEA's bottom line, Koller says, "The PS2 fits neatly into [our business] for a variety of reasons. The first is the demographics we talked about, we've been able to parse who buys what console. We're religious about that here at Sony."

"A lot of what is important now, is the tie ratio of software to hardware, and that tie ratio is significant... it goes anywhere from 11 to about 20 in terms of that tie ratio, so you're looking to everyone doing well there."

Claiming that almost 25 percent of 2008 NPD TRST sales came from PS2 game sales, "the PS2 consumer is still actively purchasing games. Greatest Hits, in a tough economic time like we're in now, which has a proven value message, at $19.99."

What 2009 Holds For PS2

According to Koller, the system's 2009 software lineup is "still fairly significant. We're tracking mainly social games and sports games, but there are a few outliers as well. In general I think the consumer's going to be very pleased. I think we'll see that tie ratio increase."

But what about the console's pricing, which currently stands at $129.99? Though retailers have called for a drop to $99.99, Koller doesn't think it will happen anytime soon.

"We've looked at a variety of options, and I think we're pleased with where we are; it's a significant financial contributor for us and it sells very well at $129.99. We're comfortable with the current price."

Even for publishers that have shifted the majority of their development resources to next generation games, Koller says, "As part of their portfolio the PS2 is still important." Keeping publishers engaged with the platform over the course of 2009 is something SCEA actively pursues.

"We're on regular road shows, talking to each publisher to discuss the merits of continuing to develop for the PS2. We end up discussing demographics, and where the hardware is being sold and to whom. Little shifts in ethnicity and age range, and gender is very important to them."

Is it possible to expand the PS2's audience beyond what it comprises today? Koller sticks with conventional wisdom, here: "I think the social area is a really rich area right now. Overall we really look at the Guitar Heros and Rock Bands of the world to really try and grow those areas."

The Sony exec concludes: "You look for an opportunity for a family to become involved as a family. We've spoken with developers on how to engender total family play -- retail is telling us how important it is."

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