Sony's PlayStation 3 has been on the market for a little
over seven months now, but it has not been the roaring success that company executives had
once promised. Development of the PS3 resulted in budget overruns, internal turmoil between
key executives and a lengthy
delay for the console. For his part in the rocky development of the PS3, “Father
of PlayStation” Ken
Kutaragi was forced out of the company and replaced by Kazuo Hirai.
When it comes to the sales of current generation hardware,
the PS3 is at the rear of the pack. For the month of March, Sony
sold just 130,000 of its PS3s compared to 199,000 and 259,000 respectively for
the Xbox 360 and Wii. For the month of April, sales
totals were at 82,000, 174,000 and 360,000 units respectively. In May, the numbers
were 82,000, 155,000 and 338,000 respectively.
Sony hopes to reverse the fortunes for its $599 console (the
$499 20GB model was dropped
earlier this year) by opening the flood gates with new games. There are
currently roughly 150 games available for the PS3 platform, but Sony plans for at
least 380 new games to hit store shelves during the current fiscal year.
"Attractive game software is the key to accelerate PS3
growth over the next year," said Sony CEO Howard Stringer today at the
annual shareholder's meeting.
The increased number of game titles will help Sony move a
projected 11 million PS3s during the current fiscal year. The company shipped
5.5 million PS3s through the month of March -- less than the projected number
of 6 million.
"All the production problems have been solved. We are
making a comeback already," Stringer continued.
Also on the agenda is tackling the huge losses in Sony's
Games division. The division witnessed a $1.9 billion USD loss
for the fourth quarter due to the PS3.
"We always lose money in the hardware initially, and we
recover that money gradually," remarked
Stringer. "We believe that the PS3 going forward will be vital to our
future, and succeed."
Sony is has already found at least two ways to reduce costs
on its PS3. The company removed
the Emotion Engine and Graphics Synthesizer (EE+GS) chip which is necessary
for hardware-supported backwards compatibility for previous generation games
from European PS3s. That functionality is now accomplished with software
Sony has also increased the production
of the blue-violet diodes necessary for the PS3's Blu-ray drive which
should drive down manufacturing costs.
Whether these lower costs on Sony's end will be passed on to
the consumer remains to be seen, however. Stringer had this to say last week
with regards to PS3 price cuts: "That is what we are studying at the
moment. That’s what we are trying to refine."