Om Malik posts that there are a lot of reports that Sony has overdeveloped the PlayStation 3, resulting in a console that is too expensive and will take too long to produce, and the entire video game industry will suffer for it. Reports have the cost of building a PS3 at an unbelievable $800, making Microsoft $100 or so loss per console look pedestrian by comparison.
The reason? The Cell processor and Blu-Ray drives, two Sony technologies that they are desperate to succeed. Microsoft has a console that has been out for three months, one that will be in decent supply by next month, while Sony may not sell a single unit in the United States until 2007. And its all because of the same thing that Sony always loses at: proprietary technologies.
Sony needs to realize that it always loses these battles. It lost Betamax, it lost ATRAC3, it lost MiniDisk, it lost Memory Stick (and don’t try to convince me that the PSP makes any difference), it lost with HiFD, it lost with SACD, and UMDs are failing and losing the backing of major studios. Perhaps Blu-Ray will succeed, but what good is hurting one of your most successful products to promote another?
Microsoft knew that high definition DVDs won’t be popular til at least halfway through their product’s cycle, so they didn’t need to put a drive in the 360. Sony is killing their margins to put Blu-Ray in the PS3, and if they can’t deliver enough PS3s, there won’t be enough to push Blu-Ray over HD-DVD!
We’re hearing that the PS3 won’t hit Japan until the last few months of this year, and won’t hit the U.S. until a year after the Xbox 360 was released. Sony won’t ship enough consoles to overtake the 360′s lead until late 2007. In the meantime, either the video game industry will suffer, or game publishers will start pushing the 360 and moving exclusives over to Microsoft’s console. If Sony ships so late, they will lose the support of publishers, and they can’t keep their lead without publisher support.