Sony plays to the PS4's fanbase

While the PlayStation 3 aimed to be an entertainment all-rounder, Sony Computer Entertainment chiefs insist the PlayStation 4 will focus on winning over hardcore gamers. Even so, the tiny PS Vita TV set-top box offers a glimpse into Sony's long-term lounge room strategy.

The Japanese term for gaming console – terebi gemu tanmatsu – literally translates as "television game terminal". It's an outdated notion, says Sony Computer Entertainment president and group CEO Andy House, yet the Japanese entertainment giant is still keen to paint the PlayStation 4 as a games machine above all else.

House was a keynote speaker at the recent Tokyo Game Show, joined on stage by Sony Computer Entertainment senior vice president Masayasu Ito. After the keynote both House and Ito took time to talk with a handful of international journalists at Sony Corporation's head office in Minato, Tokyo.

Due to hit Australian shelves on November 29, the PlayStation 4 arrives seven years after the launch of its predecessor. House anticipates a similar lifespan for the new console but he is determined to break the PlayStation 4's lifecycle into several key stages. A 23-year Sony veteran involved with the launch of almost every PlayStation, House has already mapped out the path of the new console as it attempts to win pride of place in lounge rooms around the globe.

Whereas the PlayStation 3 granted Microsoft's Xbox 360 a 12-month head start, the PlayStation 4 launches head-to-head with the new Xbox One. A significant difference between the two new consoles is that the PlayStation 4's camera remains an optional extra, even though the pre-installed PlayRoom augmented reality game requires the camera to play.

"The magic price"

The decision to leave out the camera helped keep the PlayStation 4's price tag down to $549 in Australia (US$399) compared to the Xbox One's $599 (US$499). For the extra money, Microsoft bundles the Kinect controller with every Xbox One, featuring a built-in camera along with motion, gesture and voice control.

While Microsoft's inclusion of the Kinect grants end users and developers greater freedom, Sony's Masayasu Ito says US$399 was deemed "the magic price" for the PlayStation 4 – bringing it in US$200 cheaper than the PlayStation 3. Efforts were made to include the camera at the US$399 mark, but pressure from above forbade Sony Computer Entertainment from making too much of a loss on the PlayStation 4 hardware. As it is Sony is rumoured to be losing US$60 on each PlayStation 4 sale, money it aims to make back via selling peripherals, software and services.

Andy House doesn't see the lack of a camera as a major hurdle for the PlayStation 4 at launch, as it is not considered a major selling point for serious gamers.

"Certainly for the earlier part of the lifecycle, the vast majority of the audience that we speak to tells us that their primary wish is for the full controller interface and there's not necessarily a huge emphasis being placed on camera interaction," House says.

In some countries Sony will offer a launch-day bundle which includes the camera, a decision to be made at the regional level closer to the launch date. House is prepared to "adjust messaging" over the time – indicating that Sony may bundle the camera with every PlayStation 4 further down the track when it is ready to target a wider audience. Sony has a history of revamping its consoles and bundles to extend their lifespan, such as the launch of the PSOne six years after the original PlayStation 1 along with several slimline iterations of the PlayStation 2 and 3.

Life left in PlayStation 3

While attention may be focused on the new PlayStation 4, House believes there is plenty of life left in the PlayStation 3. Sony only recently wrapped up production on the PlayStation 2, which was launched back in 2000.

"I don't define the end of the lifecycle as the point at which you introduce a new console, not when you are actually still enjoying substantial sales of the previous generation," House says.

"One of the advantages of managing lifecycles is that you can offer different value propositions in different markets. The later third of the PlayStation 2's lifecycle was more or less dominated by emerging markets where software value proposition and the initial console price made for an easy entry device. I would envisage that we would look to manage the PlayStation 3 and 4 in a similar way."

In terms of home entertainment, the PlayStation 4 remains a CD, DVD and Blu-ray player. House won't rule out the possibility of supporting "Ultra HD" 4K video content in the future, offering four times the resolution of 1080p Blu-ray, but he holds less hope of seeing native Ultra HD games.

Streaming video services currently available on the PlayStation 3, such as Netflix in the US and Quickflix in Australia, will also be carried over to the new console. But in another sign that Sony is refocusing on gamers, there are no plans to release an external television tuner for the PlayStation 4 or to allow the PlayStation 3's PlayTV tuner to work with the new console.

"While PlayTV was certainly successful in certain markets, I'm not sure that it saw enough of an uptake to say that it's a mandatory thing that we want to have in all of our devices," House says.

"We haven't ruled it out, but it's highly dependent on the broadcast TV market and also user preferences. There are lots of alternatives in terms of devices that carry a TV tuner."

This decision once again puts the PlayStation 4 at a disadvantage compared to the Xbox One, which features an HDMI passthrough with support for hooking up a digital-set top box or a Personal Video Recorder such as a TiVo. The Kinect sensor also acts as an infrared transmitter, allowing users to control all their home entertainment gear via the Xbox One's voice commands. Unfortunately the Xbox One is not expected to have access to Australian television's Electronic Program Guide at launch, although it is on the local roadmap.

Long-term lounge room strategy

The major unveiling at Tokyo Game Show was a first look at Sony's new PlayStation Vita TV set-top box, designed to connect to your television and the internet. Initially restricted to Japan, the Vita TV acts as a conduit between PlayStation consoles, the handheld PlayStation Vita and the PlayStation smartphone app. The Vita TV grants the handheld PlayStation Vita access to Sony's online games library along with a wealth of audio visual content. The PSOne game archive is still a significant money spinner for Sony in Japan, House says.

Sony's acquisition of the Gaikai cloud-based gaming service is also starting to pay dividends, with plans to offer PlayStation 3 titles to the PlayStation 4, PlayStation Vita and Vita TV. Such a strategy is particularly important considering that the PlayStation 4 is Sony's first which won't play discs designed for previous PlayStations (apart from the PlayStation 3 Slim). The Gaikai cloud service is due to launch in the US next year.

Apart from extending gaming across devices, the Vita TV also aims to be an Apple TV-style streaming media box, granting Japanese viewers access to Hulu and other online video services. While Sony's Google TV set-top box has failed to gain much traction, House sees the Vita TV as the chance to stake a claim in the fledgling Japanese streaming video space.

"We could stake out that territory to be that first really pioneering device that takes streamed video services and makes them big as a viewing habit in Japan." he says. "The landscape is different elsewhere but the Vita TV certainly has the potential to reach a whole new audience by combining great games and online video in the one box."

Adam Turner travelled to the Tokyo Game Show as a guest of Sony.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles