GamesIndustry.biz: Sony produces

Read this week's GI.biz editorial.

Published as part of our sister-site GamesIndustry.biz' widely-read weekly newsletter, the GamesIndustry.biz Editorial is a weekly dissection of one of the issues weighing on the minds of the people at the top of the games business. It appears on Eurogamer a day after it goes out to GI.biz newsletter subscribers.

Depending on who you choose to believe, the production process for PlayStation 3 is either running smoothly with plenty of redundancy built into the plan to ensure that sufficient units are ready for the market in November - or is the greatest nightmare in Sony's history as an electronics manufacturer, with low yields threatening to make the company's expensive albatross about as rare as rocking horse faeces come Christmas.

The two points of view - and let's not pretend that either of them is actually a fact at this point in time - don't reconcile terribly well with one another. Media reports supporting both of them are well distributed around the Internet; on the one hand, we have comments from IBM a few months ago indicating that yields of the Cell processor were great, whereas a directly contradictory article more recently cited an anonymous source saying that yields were far lower than expected. Some sources have reported that PS3 chipsets are already being shipped; others seem to believe that they won't ship until late August. And so on, and so forth.

In other words, nobody outside of Sony and its closest manufacturing partners actually knows what on earth is going on with the PS3 right now - but one very strong pointer in favour of the "everything on track" camp came this week from Chinese manufacturing firm Asustek, one of the companies which has been contracted to build the console.

Chinese newspaper The Commercial Times reported early in the week that Asustek was already rolling units of the PS3 off its production lines, with a shipment of 200,000 units set to go to Sony before the end of July as the stockpiling of hardware for the November launch begins. Asustek promptly and helpfully threatened to take a court action against any media source reporting such sensitive business information about its operations - which is as close to an unintentional confirmation as we can imagine, really.

If true, then this is good news. Sony's plan to ship six million units of the PS3 by the end of its financial year in March 2007 will leave the PS3 thin enough on the ground already, without the additional damage of having limited quantities available for launch right now. If it can turn out 200,000 units from Asustek by the end of this month, there's a strong chance that it could be pumping out a million units a month of the PS3 by November - which, combined with the stockpile of units assembled between now and that point, could actually mean a decent launch allocation for all of the firm's key territories, which would be a surprising but very welcome first for Sony, a company whose hardware launches have traditionally been somewhere between farcical and downright tragic in this regard.

Indeed, the firm seems to be working hard to earn the benefit of the doubt in this regard; British trade newspaper MCV will this week report that Sony is talking to retailers about a pre-order scheme which would see customers making a GBP 150 deposit on machines. The venture is likely to raise hackles among consumers initially, but will ultimately reduce the level of eBay profiteering surrounding the launch - and will mean that the amount people have to pay on the day for the system is significantly smaller, which should help to boost initial software sales.

Manufacturing units well in advance and engaging with retail to discuss pre-order schemes isn't the kind of thing we'd have expected from "old" Sony - these actions, if true, are the actions of a company that has learned some very hard lessons from its own mistakes (with PSP and PS2) and indeed from the mistakes of its rivals (such as Xbox 360's under-supplied launch last winter). Of course, none of this changes the fact that PS3 will still have to compete with a lower-priced Xbox 360 with a wider catalogue of games, and with Nintendo's fascinating and bargain priced Wii - but if the firm can sort out the problems which have traditionally dogged Sony hardware launches, this Christmas' retail battle suddenly becomes much more interesting.

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GamesIndustry International

GamesIndustry International

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GamesIndustry International is the world's leading games industry website, incorporating GamesIndustry.biz and IndustryGamers.com.

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