News > Interview with Kaz Hirai on PS3 market
August 21, 2006
Content taken from Gamespot:
This week, yet another game-industry analyst issued yet another report predicting yet another winner in the next-gen console race.
"By the time third-generation consoles reach market maturity in 2011, the PlayStation 3 will once again be the market leader," said Yankee Group in its report. The Boston-based industry-research firm went on to predict that over the next five years, Sony would sell 30 million PS3s in North America, attaining a 44 percent market share.
But how did Sony feel about it? To get some answers, GameSpot spoke with Sony Computer Entertainment American president Kaz Hirai about the Yankee Group report and his company's ongoing preparations for the PS3's November launches in Japan, North America, and Europe. The executive also addressed the controversy surrounding Sony's first handheld, the PSP: Will there be a price drop? Will there be a redesign? And is the PSP's UMD format going the way of Betamax and MiniDisc? GameSpot put those questions--and others--to Hirai earlier this week.
GameSpot: Why do you think the Yankee Group report has the PS3 coming out on top?
Kaz Hirai: Different people have different opinions, and at this point in time they're all forecasts. And people make forecasts based on the information they have at hand--their experience with what the companies in this space have done in the past, et cetera. And I think that as far as the Yankee Group goes, they've looked at the information they had at hand. It's generally a very positive report, but you can tell they've done a lot of their homework because there are some things that we need to work on. We've had those ups and downs as far as manufacturing is concerned on the console, for example, and that's being properly addressed. So I think they looked at all the information they have at hand--good, bad, or indifferent--and came to this conclusion. And I obviously think that they did a great job on this report.
GS: So is the PS3 already being manufactured?
KH: We haven't started manufacturing yet. Some of our ops guys were actually just in China, and also in Japan just reviewing the [production] lines and everything else. But they are, again, preparing as we speak to get the manufacturing going. We've not announced and we haven't set really a specific date to say, "As of this day we're going to start manufacturing."
GS: Right. Now you mentioned the PSP hardware. Now obviously there have been rumors about a PSP hardware redesign. Will Sony have any news on that front anytime soon?
KH: No, right now we're comfortable with what we have. I mean, you probably have seen some of the numbers that were included in the Q1 earnings report from Sony Corporation and as far as the platforms go. Between PlayStation, PS2 and PSP, the PSP happens to be the fastest-growing product we've ever launched. I think we cleared 20 million units worldwide within the first what, about 18 months or so. And in the US, we've already cleared 5.2 million. Again, it's only been in the market a year and five months, so we're obviously very happy with the technology we've packed into the current PSP, and we don't have any plans to redesign the PSP at this point in time.
GS: The other question is, of course, a possible PSP price drop. Is that going to happen this year?
KH: Again, [there are] no adjustments on the horizon as far as PSP goes. We're happy with the pricing, we're happy with the value proposition and we also just recently introduced what we call the Core Packs. I think that's a great value proposition to the consumer. So we have no plans to revisit the price at this point in time.
GS: Now one of the bigger criticisms the PSP has come under fire for is the UMD movie format. There's been some reports, especially in some of the Hollywood trades, that movie studios and retailers are pulling support for the UMD format. Also, now you guys are coming out with this new video-to-Memory Stick [Duo] system. Do you still consider the UMD a viable format? If so, how do you plan on reinvigorating interest in it? Or do you see more of a direct-Memory-Stick-video video platform in the future?
KH: We see the UMD as really being a delivery medium of entertainment content. And as is the case with PlayStation 3, some things lend themselves better to a delivery medium through online to the memory stick. Other content lends itself better to a prerecorded medium in the form of a UMD disk. At the end of the day, our strategy is first and foremost to establish and certainly grow the PlayStation Portable as a portable gaming and entertainment device. As a by-product of that we've set up a format called the UMD. If there are advantages, or for the motion picture companies to take advantage of UMD to deliver their content or music companies to deliver their content on UMDs, that's great. But at the same time, if they perceive another delivery medium or other ways of delivering that content to the consumers to be enjoyed on the PlayStation Portable, at the end of the day that's all going to help in increasing the installed base of the PlayStation Portable, and that's all good news as far as we're concerned.
Read the full interview here.
