(ARTICLE) Sony, Namco and Sega working together?
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Sony's back on the horn
By Matt Berger
February 22, 2001 03:00 AM ET
Get-rich tip: Add a quarter, play
again.
When playing an arcade game, a
second chance is as easy as adding
a quarter. In the $6 billion video game industry, it seems a
second chance is just as easy to come by -- only a little
more expensive.
After inserting about $112 million worth of quarters in the third
fiscal quarter ending December, the video game division of
entertainment giant Sony (SNE) is back on the horn telling
the world that it will turn around its PlayStation 2 video game
console sales and go back to being a profitable company this
year with a number of new ventures.
How the company plans to do that, Sony President Ken
Kutargi told reporters Wednesday, involves shipping 20
million units of its PlayStation 2 game console worldwide in
the 12 months beginning in April. That lofty goal is in addition
to the 9 million units expected to have hit retail shelves by
then.
As of Feb. 18, Sony says its global shipments of PlayStation
2s reached 8.16 million units. Of those, 4.38 million consoles
went to Japan, 2.1 million to North America, 1.68 million to
Europe and reportedly a few to Iraq.
The turnaround from Sony's earlier mishaps -- including failing
to deliver on its original estimated shipment -- lies in the
company's ability to fix production troubles related to the
"Graphic Synthesizer," the elusive semiconductor that runs
the PlayStation 2. Kutargi said that was under control.
The company also said Wednesday it plans to link its next
generation video game console to NTT DoCoMo's (NTT)
popular i-mode wireless Internet service and team with Sega
and Namco to turn the PlayStation 2 into a broadband hub.
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Ripclawe
Wednesday February 21 12:20 PM ET
Sony Moves To Defend PlayStation
By YURI KAGEYAMA, AP Business Writer
TOKYO (AP) - Sony Corp.'s video game unit promised more games and a connection
with Japan's hit Net-linking cell phone
service Wednesday to defend its PlayStation 2 machine, a money-losing business
that has dragged Sony profits.
Sony Computer Entertainment president Ken Kutaragi said his business will pick
up soon when shipments start catching up
with demand, especially in the United States and Europe, where the consoles are
in short supply.
Sony is also banking on linking up with ``i-mode,'' the cell phone Web service
from NTT DoCoMo, hoping to tap into the 19
million i-mode users in Japan.
A cord to link the i-mode phone to the game console allows users to browse
i-mode sites - such as colorful graphics,
restaurant guides and train schedules - as well as edit and read e-mail on a
bigger TV screen linking with PlayStation. The
cable will start selling March 29 for 3,500 yen ($30).
``This is a new form of communication entertainment,'' Kutaragi told reporters.
A parts shortage has crimped shipments of PlayStation 2, which went on sale in
March in Japan and before Christmas in the
United States.
Sony's video-game business - once the star of the Sony group - lost about 13
billion yen ($112 million) in the third quarter
ending in December, largely on the cost of launching the new machine. Software
sales remained flat.
But Masahiro Ono, analyst with UBS Warburg Dillon Read in Tokyo, was optimistic
about the future for PlayStation 2.
``It's gotten over all the initial bumps of hardware production,'' Ono said.
``It's not likely to run into too many risks from now
on.''
So far, Sony has sold 8.16 million PlayStation 2 machines - 4.4 million in
Japan and 2.1 million in the United States. Kutaragi
targeted 20 million worldwide sales for fiscal 2001.
Sony also promised to address the business' other problem - the lack of
exciting games to enjoy on the super 128-bit machine.
``PS2 titles are going to be coming out at a fantastic pace,'' Kutaragi said.
In Japan, 370 additional game titles will come out for the fiscal year
beginning in April. There are 188 games so far. Sony
would not give figures for U.S. games.
Sony also plans to offer superfast links using optical fiber in Japan in
alliance with game-software makers Sega Corp. and
Namco at retail outlets and amusement parks starting this winter to lure game
fans to Net-linking PlayStation 2 games.
Sony also announced Wednesday it will offer copyright protection and other
networking technology to Japanese software
companies and service providers as it begins to offer Net games in July.
Sony plans to start selling a hard-disk drive attachment for playing Net games
on the PlayStation 2; the company has yet to set
a price and sales plans in the United States are undecided.
Potential copyright problems have been a major reason why Sony has postponed
offering Net links for PlayStation 2.