Version Nintendo

admin January 29, 2012 video gaming No Comments

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Sony’s Vita Trapped Between Nintendo Pricing, Smartphones by Iram

Dec. 16 (Bloomberg) — Sony Corp. needs the new PlayStation Vita going on sale in Japan tomorrow to revitalize its game business and lure consumers increasingly turning to Apple Inc.’s iPhones for entertainment.
Success is critical for Sony after the gaming landscape was reshaped by price cuts from bigger rival Nintendo Co. and the growing popularity of Rovio Mobile Oy’s “Angry Birds” on smartphones, analysts said. Profit from the new portable console also is key to Chief Executive Officer Howard Stringer’s efforts to offset a slumping TV business that’s put the world’s No. 2 video-game maker on course for a fourth straight annual loss.
“Serious gamers may bolster Vita demand in the beginning, but what Sony needs is casual gamers to sustain sales,” said Satoru Kikuchi, a Tokyo-based analyst at Deutsche Bank AG. “Sony may need to cut the price as early as next year to keep attracting buyers. It’s a difficult time for console makers to make a living.”
A Wi-Fi version of the Vita, the first major overhaul of the handheld since the PlayStation Portable went on sale in 2004, costs 24,900 yen ($319 in Japan), while the 3G model costs 29,980 yen.
Sold Out
The device, with a 5-inch display using OLED, or organic light-emitting diode, technology and touch pads, already sold out in pre-ordering in Japan, said Andrew House, chief executive officer of Sony Computer Entertainment.
“There were lines to make reservations for the machine at retailers,” House told reporters in Tokyo yesterday. He declined to provide sales figures.
House’s comments came the same day Sony, Japan’s biggest consumer-electronics exporter, had its rating cut to one level above junk by Fitch Ratings, which cited difficulties reviving the TV business and deals that won’t improve profit.
Tadayoshi Sugaya, who cooks pasta dishes at an Italian restaurant in Tokyo, wasn’t among the Vita’s customers.
“I’m happy playing games on my smartphone,” said the 39- year-old chef, who uses Samsung Electronics Co.’s Galaxy model to play mahjong and other games. “I don’t see much need to buy a game player.”
The Consumer Products and Services Group — Sony’s biggest by revenue and maker of TVs, games and cameras — had a loss of 34.6 billion yen in the quarter ended Sept. 30, compared with a loss of 35.5 billion yen a year earlier.
Sony shares rose as much as 1.6 percent to 1,366 yen and changed hands at 1,346 yen at 10:10 a.m. in Tokyo trading. The shares have declined 54 percent this year.
Nintendo 3DS
Reviving demand is important to help Tokyo-based Sony recover from its worst hacker attacks in April, when intruders compromised more than 100 million customer accounts in the second-largest online data breach in U.S. history. Sony suspended those services until July and budgeted 14 billion yen in costs this year.
The device will miss this year’s shopping season in the U.S., where it will debut in February and is priced at $249.99 for the Wi-Fi version and $299.99 for the 3G model.
That’s more expensive than Nintendo’s competing 3DS after the world’s biggest maker of video-game machines slashed prices of the new 3-D handheld player to as low as $170 because of poor sales. Nintendo sold more than 795,000 of the 3DS portable units last month, the Kyoto, Japan-based company said Dec. 10, citing figures from researcher NPD Group Inc.
Sony has a “very good product” at a “very affordable price” and, therefore, won’t cut prices of the Vita in response to other companies, Executive Deputy President Kazuo Hirai said in August.
Sony Strategy
Sony expects to sell 15 million of the PlayStation 3 consoles this fiscal year, up 4.9 percent from last fiscal year, after the company lowered prices in August.

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