The video gaming industry has come a long way from the first home based gaming system since the Magnavox Odyssey. Through the decades, the video game industry has rapidly improved the technology to home gaming, and made arcades nonexistence. The major video gaming titans of today are Nintendo, Microsoft Xbox, and Sony Playstation. These three have been in war with each other the past ten years, and neither show signs of defeat. However the two leading competitors of high sales in the gaming industry are Microsoft Xbox and Sony Playstation. Both developers have been head to head on technological advancements and consumer marketing. Sony uses their advanced design of game console and their secrecy of their project to entice consumers. Microsoft however tries to direct their marketing strategy towards consumers themselves. With different marketing planning, both companies still show success. Sony and Microsoft’s entire production unit were sold out when they were released at their release date. Sony Playstation 3
On November 24, Sony released the PlayStation 3, kicking off the latest round in the video game console wars. But this is not like the battles of the past for Sony, whose annual revenue now hinges on outselling rivals Nintendo and Microsoft. Sony doesn't seem to realize the situation it's created for itself, gambling its gaming business on a strategy that will alienate the very public that made earlier PlayStations undisputed leaders for the last decade.
Sony revealed last month that profits for the second quarter were down 94 percent to $14 million due to the recall of 9.6 million faulty laptop batteries at a cost of $432 million and the $367 million operating loss of the gaming division, attributed to preparation for the PlayStation 3 launch and declining sales of PlayStation 2 and PlayStation Portable.
Everyone's watching to see how this battle plays out, because each company is pursuing a very different strategy. Sony and Microsoft are gunning for pure performance systems, while Nintendo is shooting at fun, playable games that rely more on its unique controllers than impressive graphics hardware.
Sony hasn't demonstrated any units nor leaked significant information about the machine. This is a smart marketing strategy. Leaking information only dilutes the power of the final product launch and does nothing to actually satisfy consumers. Withholding information, on the other hand, builds buzz and word-of-mouth interest. Think of the power Apple gets from all the secrecy around its products. Sony is doing the same thing. Sony is a marketing company. It sells as much style and excitement as it does electronics. Sony's brand has in the past commanded premium prices because of Sony's savvy marketing.
The company's future relies on the PlayStation 3 and the technology that comprises it. Until November because its two most exciting pieces of technology weren't ready - the Cell processor chip and the Blu-ray drive. The complexity of the chip, co-developed with IBM and Toshiba, delayed the manufacture of a large enough quantity of consoles for a system launch.
The Blu-ray Disc was jointly developed by the Blu-ray Disc Association (BDA), a group of the world's leading consumer electronics, personal computer and media manufacturers (including Apple, Dell, Hitachi, HP, JVC, LG, Mitsubishi, Panasonic, Pioneer, Philips, Samsung, Sharp, Sony, TDK, and Thomson).
This next-generation optical disc format has a slight technical superiority over its rival the HD-DVD, due to its ability to hold up to 25GB of data on a single-layer disc and 50GB on a dual layer disc vs. the HD-DVD's 15GB. But the price of greater storage will be high. The future of the $24 billion home video market will depend on which format wins over the marketplace. This means the PlayStation 3 is fighting a war on two fronts, one on the gaming console front and the other on the video front. Since the Blu-ray technology is a new one, it...
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