Wednesday, June 20, 2007

PlayStation Head Departs

The Associated Press reports that the head of Sony Computer Entertainment Inc., Ken Kuturagi, has stepped down, or rather “retired”. This isn’t surprising, given the fierce competition that the firm has been facing since its latest incarnation, the PlayStation 3, hit the market.

The PS3 launched in Canada just in time for the 2006 Christmas season, and to say it was highly anticipated would be an understatement. Kids lined up in droves outside local retail outlets, in some cases a full 24 hours before the product was to go on sale. The lucky few who got their hands on one before the "suckers" who waited at home reveled in their 15-minutes of fame. Some made extra holiday spending cash by selling consoles on eBay for double, triple, and even four times the actual selling price of the unit. It was mass hysteria, to say the least.

A few days after the PS3 launch, a funny thing happened. A company called Nintendo (heard of ‘em?) launched its fun, family-oriented Wii gaming console: a far cry from the hard-core gaming, high-definition experience that the PS3 provided. The Wii brought together families and friends by encouraging full-body physical interaction. Want to play “virtual” bowling? Thrusting a joystick back and forth won’t cut it: you’ll need to grab the neat controller (which looks just like a TV remote) get on your feet, and simulate the action, as if you were actually bowling the ball. Same goes for other games: boxing, baseball, you name it. Some laughed at the juvenile nature of the Wii (let’s face it: it’s hard not to given the silly-sounding name!) But Nintendo had the last laugh. It unearthed an untapped and lucrative market that no one realized was there.

Fast forward about seven months, and Nintendo reports having shipped 5.84 million Wiis worldwide (through the fiscal year ended March 31), compared to 5.5 million PS3s. Meanwhile, the Xbox 360 continues to flourish, especially in terms of its seamless LIVE subscription, which allows users to play online with friends all around the world.

That said, although the PS3 certainly turned heads and sold a lot of units, it’s seeing a lot of stiff competition in an area that the company has historically dominated.

Kazuo Hirai, former president and COO of Sony Computer Entertainment, is now heading the unit. According to the Associated Press, although Kutaragi has retired from his post as chairman and goup chief executive, he will still serve in an advisory position with the firm.

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