SONY'S BATTLE FOR VIDEO GAME SUPREMACY
John Sterman, Kahn Jekarl, Cate Reavis
Rev. December 8, 2011 13
Adopting a popular model from the PC casual game industry,F
F demos of Xbox Live Arcade games
could be downloaded for free with the full version available if purchased. In addition to nostalgic
titles such as Frogger and Galaxian, new titles such as Geometry Wars were very popular as well.
The game development community praised Arcade and were hopeful that it would hearken a return to
the days of innovative, smaller, and less financially risky games. Microsoft, however, was very
selective and restrictive in releasing games on Arcade, so it was unlikely that many developers could
be sustained by the Xbox Live Arcade alone.
Nintendo, with its new Wii console, looked forward to launching the first Nintendo console with
well-integrated online functionality that, among other things, provided Wii owners with weather
updates and email and web browsing services. Named the Virtual Console, the online service’s most
compelling feature was access to the enormous library of high-quality Nintendo titles dating back to
1984. Classic games for the original Nintendo, the Super Nintendo, the Nintendo 64, and the
GameCube would be available for download at prices ranging from $4 to $8. Nintendo hoped that
the pull of nostalgia would bring older gamers back to Nintendo.
Sony would be entering the online video game arena with the PlayStation Network Platform,
described as an “ecosystem” comparable to Microsoft’s Xbox live which would be launched
simultaneously with the PS3. The platform would allow players to connect to the Internet so that they
could play against each other online as well as communicate through email and live voice chat.F
F PS3
owners would also be able to purchase games although it was not known if the back catalog of
PlayStation and PS2 games would be available for download. Unlike the Xbox 360, the PlayStation
Network Platform would allow licensees to connect their own game servers to the network.F
F As one
analyst opined, “Sony sees online as more of a loyalty builder for their audience rather than a money
making strategy. Microsoft sees it as both.”F
Many industry analysts speculated that the new generation of video game consoles— the Xbox 360,
the Nintendo Wii, and the Sony PS3—would overshadow the role of the PC in many homes. As one
technology analyst pointed out, the games console was becoming the focus of breakthrough
technology: “It suggests the platform of growth (in home computing) is shifting away from the PC to
the games machine.”F
F As the CFO of video game publisher Electronic Arts put it, “The stakes for
next generation hardware leadership are enormous. It’s about owning the set-top box that may
ultimately connect the living room to the Internet.”F
F
The term casual game refers to a category of electronic or computer games targeted at a mass audience. They typically have very simple rules or play
techniques making them easy to learn and play. They require no long-term time commitment or special skills to play, and there are comparatively low
production and distribution costs for the producer.
Daniel Terdiman, “Sony’s PlayStation 3 Race,” CNET News.com, March 22, 2006.
Hirohiko Niizumi and Tor Thorsen, “PlayStation Network Platform Detaile,” GameSpot, March 15, 2006.
Kim Peterson, “Sony Online Gaming to Debut with PS3,” The Seattle Time, March 23, 2006.
Chris Nuttall and Richard Waters, “All to Play For: Microsoft and Sony Take the Video Game Battle to the Next Level,” The Financial Times¸May 11, 2005.
Ibid.