Arrogance
I think in the end Sony misjudged when MS would release their console and, like most in the silicon industry, had initially drawn up plans that were too aggressive. Their insistance on Blu-ray sticks out as the most "optimisitic" element of their plan.
I think Sony have designed the PS3 to be exactly as would be expected from creating a simple trending line upwards from console generations, and especially upwards from Playstation 1 and Playstation 2. I think in terms of hardware and such, they have also beens succesful and right in doing so. I think the main area where they could have done better than they have now is in the software area exclusively.
Not surprisingly, I disagree with your analysis, but that is partly because it seems you're dropping into this discussion without reading the previous pages, or at least adressing the points already raised against your own arguments.
For the PS3...
• Blu-ray was not a mass market technology with a streamlined pricing model, impacting PS3 price points
If we consider the timeline difference against the projected time that the PS3 is going to be on the market, then Sony's choice was by far the most sensible one. Compared to DVD (and that's partly depending on to which market you look - in Japan for instance DVD wasn't as logical a choice as in other regions at the time the PS2 was launched), BluRay was 2 years behind for most of the time during which Playstion 3 was designed, and had everything gone to plan with BluRay, then the difference could have been even smaller. These delays hurt, but on the other hand, considering the time that the PS3 was supposed to be on the market, and the advantages of BluRay and the potential impact of PS3's support of the medium in general, compensated for these and made the choice to go for BluRay all the more logical.
• Blu-ray made the inclusion of a HDD, a longterm costly addition, desirable
As if there is any difference for this whatsoever for DVD support. Even if DVD and BluRay have slightly different accents when it comes to strengths and weaknesses, in the main the same bottlenecks exist, not to mention all the other advantages of HDD that are so far proving essential.
• Blu-ray wasn't a consumer proven technology with strong demand, offering little compelling consumer desire to pay a premium for the feature
Again flawed, especially in the context of the decision taking process having to take a forward look (it's always hard to predict the future), as at the time the decision had to be made there was every reason to believe it would be the de-facto next standard. Nobody expected HD-DVD to make it as far as they did, and even now BluRay looks like it will make it. Another important difference is while DVD offered more advantages, there is also a much smaller threshold for people to go from DVD to BluRay. They can still use their existing library of DVDs with the added bonus of things looking better on HD tvs because of impressive upscaling, when the change to DVD meant you had to throw away all your VHS stuff, with the added downside that for a long time VHS was your only method for recording video as well.
• Blu-ray wasn't prime-time: HDMI 1.3 wasn't finalized, BDR releases were pushed back, diodes were in short supply and very expensive, etc resulting in the console's delay
Basically, HD was delayed, TVs came slower initially, HD-DVD was delayed, BluRay was delayed even more, HDMI standards slow in finalising, and it slowed down the PS3's launch and kept its build cost higher for a longer time. Personally, I consider Microsoft's strategy and Sony's strategy very much of equal value and equal risk in the main, and which one succeeds will depend in a large part on luck. The jury definitely isn't out, but again, if Sony makes it for another generation, against a tough opponents (Microsoft is huge and powerful with strong ties in the U.S. in a lot of ways, Nintendo has turned into basically a small inventive, flexible company), in one of the most complex markets to date, it's not because they made obvious errors in the decision process.
For Consumers...
• Blu-ray was expensive
• Blu-ray was not an industry standard and faced an ugly format war with HD DVD, Digital Distribution, and DVD
• Blu-ray had little compelling content compared to its primary competition (DVD) and was splitting big new releases with HD DVD
Striking that you've put all of these in the past tense. You're basically writing this in the past tense, so I'm assuming that basically you're referring to why Sony haven't sold all of their projected consoles. What if after the holidays they finish at 8 million instead of 12 million sold (though I think the original target was 12 million shipped). Would that be a failure?
Blu-ray requires an HDTV to get benefit from (HDTVs being a smaller portion of the market)
However, from the looks of it, HDTV is still going to take over in a fairly rapid progression. In some countries it already has taken over (with the majority of households having one), and in many others it will have after this Christmas. Basically, of every new TV sold today, in most countries (you can keep them in line with the trend of countries that are also most likely to buy a next gen console in the first place), I'm willing to bet that more than 90% of TVs sold are 720p or up.
Blu-ray offers fewer consumer advantages over DVD than DVD did over VHS
But again, also fewer disadvantages, and a painless transition period.
Blu-ray came loaded with copy protection concerns
Maybe, but it doesn't seem like something that anything but some of the guys in online discussions have worried about too much, and in practice I don't see it mattering.
For developers...
• Blu-ray's major benefit, capacity, was a low priority issue due to the cost of content generation and the fact DVD had been servicing 2 megapixel gaming for years without issue; solid workarounds (disk spanning, HDD caching, etc) also existed to address these issues
This is a huge discussion that I've been having here in this very thread, so I'm not going to repeat it. But my arguments in that discussion so far still stand, so I'm not going to repeat them now. I think I have demonstrated that whatever reasons there have been for games currently released in this first year, it is NOT the cost of content generation trhat stops developers from filling up a BluRay disc. There is also a major internal inconsistency in your argument here in that you cannot use HDD caching as an argument when you earlier state that it was BluRay that caused the HDD to become an essential part of Sony's console that was going to stop them from being able to cost reduce the PS3 further along the line.
The inclusion of the HDD was a nice addition, but the impact on consumer caused the by the price was negative and, as the Xbox1 demonstrated, a HDD had yet to deliver a significant platform distinguishing feature in the console market
Faulty on two levels. First of all the Xbox1 had demonstrated very clearly several significant platform distinguishing features the HDD delivered to the console market. Part of the success of the 360 as a platform today build on those features introduced by the original Xbox (not just in terms of downloadable stuff, customised soundtracks, but even simply in the one single, most important game of the Xbox, Halo 2).
However, in the previous generation the cost of the HDD didn't weigh up against the benefits of the HDD, partly due to lack of consumer awareness, partly due to the Xbox being the weaker platform, and partly (probably most importantly) because the online part of console gaming wasn't significant. Very much today still that online factor is making a big difference in the U.S. versus for example the Japanese market. With today's consoles online and media features, the HDD very clearly adds a lot and they are definitely important to the consoles that have those features.
The delays caused by Blu-ray impacted the lead SKU for next gen titles as the 360 was already present on the market, giving publishers a new revenue stream now to invest in
This was no change though from last generation, w here most publishers were already targeting all three last-gen consoles for the majority of their titles.
The same points can be made about CD technology--it wasn't affordable enough in the SNES/Genesis days, but was ready when the PS1/SS arrived. Sony had wisely rode two proven and/or quickly emerging main stream technologies with the PS1/PS2. Blu-ray was a departure from this strategy
Not to them. Not to me, not even now. But things can rapidly change in any market. Say that the Wii is going to be so successful in actually focussing hardware innovation to very specific areas only that allow for software innovation that are not audio-visually significant, then neither Sony nor Microsoft could have seen this coming. The choice for DVD technology even when established, could have suddenly become superfluous if tv-on-demand services had suddenly developed much faster for whatever reason. Under normal circumstances, taking the next 10 years into view, and assuming the normal progression of hardware requirements has they had progressed for almost every previous console generation (they didn't come up with that graph for nothing - this is how they were thinking, and were they wrong? certainly it seemed very obvious), BluRay was the logical choice, even if it was a projected 2 years behind in terms of market acceptance regarding DVD. Even that was a fairly normal progression, because DVD was much shorter on the market as CD had been and wasn't nearly as established in all regions at the time, and certainly not when the final decision to go DVD had been made.
and was aimed at riding the success of the PlayStation brand into market superiority. Never mind the fact the jump from CD to DVD (7x-13x as much data for SL/DL) was quite a bit larger than we are seeing from first generation Blu-ray disks (3x jump over DL DVD)
What? There are several 50GB discs out there already (I have three spiderman discs alone
), and just the fact that games haven't used all of that space yet doesn't mean anything. Most of the first games on the PS2 were released on CD-ROM (remember how quickly though the cute black discs where replaced with the blue-colored DVDs?). Sure, a lot of the first-year games could have been pressed on DVD, in some cases some additional effort required but possible, but already several games use more space than that, and at the very, very least one game is out there that couldn't have fitted on a regular DVD without significant changes to the game. Again, I'm not going to repeat the whole argument, but if you're so keen on drawing parallels, then be more careful.
Or more importantly that all the trumpeting and chest beating in the face of the HD competition, HD DVD, that Blu-ray's major benefits (like capacity) have preven pretty much irrelevant for the HD movie market. HD DVD videos look just as good (early on they were better looking due to codec issues). So HD DVD had enough space to meet the desired purpose--and did so at a lower price. They can now be found for under $200 and major studios have jumped off the Blu-ray ship.
Not exclusively though. The war is just taking longer than they have anticipated, and they have to balance helping to decide the war in a phase where it maybe doesn't matter to them so much yet, against the sweet deals that they can make from playing out the one against the other.
I do find a bit of irony in the entire situation. For years people got kicks out of berating Microsoft for subsidizing their Xbox platform as a trojan into a new market (the living room). The lack of noise in this regards to those same complainers about the same strategy by Sony... well, I find it quite hillarious!
Sorry, but even that's nonsense. The same arguments exist for and against everything, and they will be repeated in every discussion that touches them over time. The value of those arguments will increase or decrease depending on how their context changes, and also the people who use those arguments change.
Not that I have a problem with what Sony is doing. I am not investing in HD optical technology because I believe it is antiquated and Digital Distribution will be my next format choice. Blu-ray is Sony's last major optical technology oppurtunity. And IF the strategy had worked
There's the past tense again.
• Sony's PS3 would have a major selling point over the competition
• Blu-ray would have tens of millions of consumers within a couple years to propel the format and force consumer/publisher adoption
• Sony would ride the HD wave, selling tons of HDTVs, HD consoles, and HD media players
• Sony would reap a huge windfall of royalties for Blu-ray and PS3 media
The problem is you need 2006 sales to get 2009 sales.
Nope. If at this point Nintendo stopped supporting the Wii and didn't have stuff like SMB, then in 2009, the Wii would have disappeared. Conversely, 3 years ago the Wii didn't exist, but in its first year the Wii is doing already almost as good as any console did in its best year. The market isn't that simple. Oh and by the way, HDtvs are very much being sold (though obviously not all to Sony, but they're making as healthy a profit there as anyone else). And this year, BluRay has been for almost all of the year in a position where it is beating HD-DVD on every level.
Sony lost any momentum/brand advantage in 2006 by totally misjudging the market's ability/desire to sustain a platform with a high price tag and little compelling media content (games or videos).
Sony badly needed either killer content in 2006 or a reasonable price ($400) with the expectation of potential. They lacked both and their competition moved in.
All your arguments hold for 2006 (and the majority of 2007). The reasons are known. Your conclusion however, is simply too soon. What evidence is there even that 360 sales aren't naturally progressing from the Xbox's previous generation? You think that 2006 is the pivotal point in this 'console war', you even seem to think that it can be easily won or lost in absolute terms. But there are no such absolute truths or values. Is the PSP a failure? If you expected it to beat the DS as the PS1 did the N64, then yes. If you define failure as gaining the majority of market share, then yes. But fact of the matter is that it turned out to be a healthy platform with more than respectable sales, that while overshadowed by the runaway success of the DS, is still doing very well, and rather than slowly wither away now that the DS has settled itself as the 'clear' winner, is actually looking to do even better in the near future.
Sure, NOW Sony has that $400 price, but HD DVD is half that. The Wii and 360 offer gaming at substantially lower price tags. And in the gaming space the competition has the lead in compelling content
For some, the majority even, but not for all. Substantially lower is also overstating it and very much up for discussion.
and in the movie market HD DVD has made some major moves.
But HD DVD still is losing to BluRay, and PS3 sales, low as they may be, positively dwarf standalone player sales of either type.
And in the gaming space Blu-ray continues to find it difficult to justify itself in the gaming world. For all the self praise and boasting of content size, the fact is Blu-ray based games aren't longer--and they don't have better graphics regardless of the Sony evangalists. The best MS is offering on DVD arguably has been better graphically than what has been seen on Blu-ray. Nevermind the skyrocking development costs and the expense of actually filling a Blu-ray disk with actual game content, Blu-ray has failed to justify itself in its first year.
Rinse, repeat.
Down the road it may, but that is a poor console market strategy.
So you don't believe in long term market strategies for the console market?
These aren't PCs with a small, niche, power user mentality. Console consumers are demanding in regards to price and benefit. If they don't see the benefit they won't pay hundreds of dollars for it. If Blu-ray begins justifying itself in 2008 with a couple titles that show major differences to consumers, selling point worthy differences in games, and causes a market shift in 2009... hold the press! 2010 may see the first 4th generation 3D consoles.
Fact is, the PS3 has been designed with the same things in mind as the PS1 and PS2. Looking for the PC isn't bad in that regard. Costs scale. If you want to build something that lasts that long, you have to be forward looking and factor in what parts experience cost reduction and what don't, what parts are worth initial investments for the long-term benefit and what aren't. I'm personally someone who likes to look at the long term. The current console wars aren't different. Costs for developers equally factor out the initial R&D costs versus the lifespan of a console. The Wii aims for a shorter cycle but compensates by low R&D investment costs for developers. The PS3 has high initial R&D costs, but promises a longer cycle. The 360 is somewhere inbetween. They are all valid choices. How valid, we'll see, but it would be silly to judge a long term strategy on such little data as we have today. After all, I don't know if you still remember, but as huge as the initial cost differences between the Atari ST and Amiga were, very much at the end of the cycle the Amiga still overtook the Atari ST both in terms of software and hardware sold, with the Atari ST also being easier to develop for early on.
I like to see the Playstation platform as a garden that Sony is planting with seeds, and the time for each seed to come to fruition a direct factor of how many seeds have been planted. The 360 and Wii have progressively smaller gardens, but they can direct more attention per seed, so they come to fruition quicker. Initially, their gardens will be more interesting to look at, but eventually the Sony garden will be the largest garden with the most most variety.
The metaphor is obviously a simplification: it's like you can study till your 16th and then start working, and you can start studying till your 24th and then start working. In theory, the higher degree should always give you the better jobs, but in practice, given the same amount of talent, you'll potentially make more money if you start working at 16, because you can learn on the job and in the meantime make money while a student will lose money. And obviously, how much talent you have also depends on the amount of sklil, knowledge and discipline your parents gave you.
Your point of the importance of the first year is valid to some extent in the context of long-term investments, where the first year of profits counts heavier because those profits provide returns for the longest period (say, the other 9 out of 10 years). But that doesn't also mean that later returns cannot more than compensate for this.
And that is what it comes down to. Blu-ray, on a cost basis, offers low bang-for-buck this generation. Blu-ray was too early. Sony waiting on Blu-ray resulted in too much PS2 development focus. Instead of trimming the already impressive PS2 revenue to capture longterm PS3 revenue, Sony rode the PS2 too long with the hopes of their brand sustaining a weak software lineup and a fledgling HD media format with tough competition and little compelling consumer benefit to the majority of consumers who lack HDTVs.
This is so obviously wrong again. How much investment has Sony done in the PS3 again? How is that not trimming the already impressive PS2 revenue to capture longterm PS3 revenue?? Again, a major internal inconsistency in your argument.
Sony needed more contingency plans and needed better risk analysis. It was pretty clear to me that Sony was 1 generation too early for this sort of market move. If the PS3 was a Cell/RSX console at $400 in 2005 and Sony had shifted appropriate development support to the PS3 ahead of time they would have crushed MS and would have been in a much better position to fend off Nintendo.
If it had been that easy, then Microsoft and Nintendo would probably have done the same. These generations are very long. You're too dismissive of that fact, and your focus really is too much on the short term. Short term could be good, short term could work, but short term is not what you can tell the outcome by. We might as well make all sports matches fit the sudden-death format.
And in 2011 with MS out of the market (RROD and a competitive PS3 launch would have killed them) and Nintendo not focused on being the living room media hub, Sony could have realized their vision as a home super computing standard and moved the market outside of gaming and into a more broad entertainment/basic home computing/social platform.
Completely pointless remark. MS's goal to gain the livingroom is not dependent on the Xbox. For media center purposes, do you think there are more Xboxes or more pcs in the living room right now? The importance of Xbox to Microsoft is more complex than that.
And Sony would have the primary gateway for Digital Distribution.
Again, nonsense. As if there aren't tonnes of other players on this market.
Interestingly, I think in the process of the 3 console releases we have learned more about consumers than we have about Sony, MS, and Nintendo. The PS3 has faced difficult times because Sony misunderstood consumers. The question is how will these companies respond to this knowledge--are they each willing to face their demons to meet consumer desire? Or will they continue to use their platforms as trojans for their broader corporate strategies? Sony has showed us that consumer demand has to be the priority in planning.
I think more than anything else, all three platforms (not to mention handheld gaming, mobile phones, pc games like world of warcraft and so on) are showing that as the computer entertainment market keeps rapidly expanding, there are more and more ways of making money in this business, just as in any other, and competition is a great thing that tends to benefit consumers.
EDIT: Shifty and I seem to have aligned our opinions a little further, which often happens after discussion.
