PS2 Cycles to $149
The Three Kings: Let Them Eat Cheap

Rather than leap forward to the $99 mass-market consumer, Sony Computer Entertainment of America (SCEA) chose to keep that card in its corporate pocket and reduce the price of the PlayStation 2 to $149 in North America effective immediately. Also headlining Sony's press conference was the introduction of the PlayStation Portable (PSP) and the announcement of the Cell Workstation.

Noting that the new PS2 price point brings Sony to the "tip of the mass-market consumer," president and CEO Kaz Hirai explained the move to $149 by recalling that 90 percent of the original PlayStation’s sales volume occurred after that system was reduced to $149. Sony will immediately advertise the lower price in national television and print outlets.

Citing a desire to boost console life cycles to 10 years from the generally accepted six years of the current-generation systems, Hirai said it was essential for Sony to use its leadership position in the videogame industry to manage the PS2's price to that end. In addition to maximizing Sony’s investment, Hirai said a longer cycle would benefit game developers who see their development cycles continue to balloon with each new generation of systems.

Hirai next unveiled the final production design of the PSP. While not revealing the final price point of the handheld, Hirai confirmed the unit would be released in Japan by the end of 2004 and in the U.S. during the first quarter of next year.

The black-accented casing is larger than the conception prototype that was released earlier this year, with dimensions of 170mm-by-74mm-by-23mm. The screen size is 4.3 inches (diagonal format), which is large for a handheld. On the question of battery life, Hirai said the PSP's lithium-ion power cell is expected to provide 10 hours of gameplay, eight hours of music, or two-and-a-half hours of movie watching from the system's Universal Media Disc (UMD).

Despite its wider entertainment features, Hirai confirmed that the PSP will be marketed in North America as "a handheld videogame system," with 18- to 34-year-old males as the primary target consumer. Four Electronic Arts titles—NBA Street, Need for Speed Underground, NFL Street, and Tiger Woods PGA Tour—were demonstrated.

Hirai claimed that motion picture studios are preparing to support the PSP, yet he did not name any. Although a trailer for Spider-Man 2 was shown playing on the PSP, Hirai did not provide any details about what support Sony Pictures or Columbia-TriStar Home Video may have for the system.

Opening the window on the upcoming PlayStation 3, SCE's chief technology officer, Masa Chatani, announced that the first prototypes of a Cell Processor Workstation would arrive by the end of the year. A partnership with IBM, the cell processor was designed to undertake massive computational tasks by providing vast floating-point power and exceptional data bandwidth and has already been linked to speculation on Sony's PS3 technology. Chatani went on to claim that cell processor technology would be "the future of broadband entertainment."

Until there is a PS3, Hirai said Sony plans to expand its commitment to online games on the PS2. While showing an eight-player capture-the-flag match from the upcoming Ratchet & Clank: Up Your Arsenal, Hirai reported that there will be 100 PlayStation 2 online games available by Christmas.


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