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Sony Interview: Jack Tretton Defends Vita, Dedicated Consoles

Sony Interview: Jack Tretton Defends Vita, Dedicated Consoles

Fri 10 Aug 2012 2:34pm GMT / 10:34am EDT / 7:34am PDT
Business

The SCEA boss remains optimistic about consoles, says social and free-to-play are just "an additive diversion"

There are a lot of people looking to bury the PS Vita these days. Sales haven't exactly been blockbuster and the software lineup to date has been so-so, at best.

Even Sony itself has sent some mixed signals. At its pre-E3 press conference in June, the company promised 60 new Vita games this year - then only showcased three over the next hour-and-a-half. Despite that, Sony is telling investors it expects to sell 10 million units this fiscal year (which ends March 31, 2013), largely on the strength of its holiday lineup (which includes PlayStation All Stars: Battle Royale, Assassin's Creed 3: Liberation and Call of Duty: Black Ops Declassified).

Not surprisingly, Jack Tretton is a big proponent of the system. The Sony president and CEO of Sony Computer Entertainment America notes that the handheld business, like the console business, is a marathon, not a sprint - and a system doesn't have to break day one records to be a success in the long run.

"In this industry, you can't get too high or too low, because it moves very quickly," says Tretton. "I think there's an acceptable number - and [the number] we've sold: That's acceptable. If it was triple that, I'd be happier. If it was one-third, I'd be disappointed."

"I feel much better about [Vita] now than I did four months ago"

Jack Tretton

Tretton points out that even the PlayStation 3 survived a bumpy start - and while that system isn't the king of the console hill like the PS2 was in the previous generation, it's still an incredibly popular and profitable device. And Sony expects that to be true of the Vita as well.

"Anything with great rewards is going to come with great challenges," he says. "We felt if the tech was there, and the game support was there, then the audience would be there. … I feel much better about it now than I did four months ago."

1

That's good news for Sony, which is relying heavily on the PlayStation division to help reverse the company's struggling fortunes. The ascension of Kaz Hirai, who oversaw the PlayStation unit during the PS2 heyday, to CEO put an additional focus on Tretton's division. That's a lot of pressure, given the hurdles Sony must overcome.

Earlier this month, the electronics giant reported a loss of 24.6 billion yen ($315 million) in its fiscal first quarter, versus with a 15.5 billion yen loss the previous year. The games unit saw a notable decline in sales as well, selling 800,000 fewer hardware units and coming in at an operating loss (which is unusual for the division). Software sales were also down.

Still, Tretton says he's excited to face the challenges of being one of the company's three pillars (along with mobile and digital imaging) - especially since he remembers the days when the PlayStation was far from the company's favorite child.

"I think it's the best news I could ever hear," he says. "When I joined Sony Computer Entertainment, I'd meet people from other Sony divisions. I'd be at an industry event and they'd read my name badge and say 'Sony Computer Entertainment? What the hell is that? I work for Sony music.' Sony Computer Entertainment was very much an offshoot and not an intimately familiar division of Sony. … To go from there, where you're a science experiment, for lack of a better word, to one of the three major pillars of the corporation is great."

"There's a place for social and freemium, but it's not going to replace the business models that are out there"

Jack Tretton

Some critics have questioned Sony's reliance on the PlayStation division, noting the emergence of smartphones has curbed demand for dedicated handheld devices. They openly wonder about the longevity of console systems as well. And they point to the rise of social and free-to-play games.

Tretton, though, says he's not worried about any of that.

"I think the opportunity to be in the console business is greater than ever before," he says. "[Social and free-to-play] is a business I think a lot of companies are learning is difficult to sustain for the long term. It's an adjunct or it's an add-on, but it's not where gaming is headed. It's an additive diversion. There's a place for social and freemium, but it's not going to replace the business models that are out there."

And while many gamers are complaining about the ongoing trend of sequel-itis and an increasing focus by publishers on action games, Tretton says that's the nature of the industry - and reminds players that no trend lasts forever.

"I think it tends to go in cycles," he says. "If somebody comes out with a game people enjoy, it draws people to that genre. Shooters have been bigger the past few years. I think they're not just the same game done with a different storyline, they're taking that genre and expanding on it. … Sometimes racing is really relevant. Sometimes it's not. The same thing happens with sports, or RPGs. … I don't think our industry is any different. [In any form of entertainment], you're going to get a herd mentality moving to where the consumer is."

14 Comments

Terence Gage
Freelance writer

1,288 120 0.1
"[Social and free-to-play] is a business I think a lot of companies are learning is difficult to sustain for the long term. It's an adjunct or it's an add-on, but it's not where gaming is headed. It's an additive diversion. There's a place for social and freemium, but it's not going to replace the business models that are out there."

I think this is a really sensible comment which succinctly summarises my thoughts on the F2P movement. Of course it has been wildly successful for some companies and many if not most publishers are trying to or looking to make inroads in the sector, but I think it should be done alongside other business models, not instead of.

Hopefully Sony will have spent the last six months incubating a variety of Vita 'killer apps' and will stagger their releases over the next 18 months, while the console gains that vital traction in the marketplace, because at the moment its outlook is rather bleak and if Sony don't properly support it, I can't see many third parties being happy to shoulder that burden themselves.

I seriously think a few RPGs like Dark Cloud 3 and Legend of Dragoon 2 would help its prospects in Japan no end. Soul Survivor looks like a step in the right direction, but that alone won't be enough.

Posted:2 years ago

#1
Zynga is proving the free to play model is a failure, add the fact that hundreds of tiny social and free to play companies are dying every year equals the free to play fad heading to graveyard. SCEA has done a great job of changing their draconian business practices and has made it a safer place for developers, Microsoft should take notice.

I anticipate big things from Sony during the next console refresh...

Posted:2 years ago

#2

Craig Page
Programmer

382 218 0.6
Vita's problem is it doesn't have any great games, when it does then sales should go up.

I also think they'd sell a lot more Vitas if they offered a better bundle, with a 4GB memory card and $100 credit for the Playstation Store. So people could either buy a new Vita game there, or a bunch of older PSP games. Sony would sell a lot more Vitas if they did this, AND those 4GB memory cards would fill up long before the consumer used up all of their $100 credit. They'd have to spend $30, $60, or $100 on another memory card.

Posted:2 years ago

#3

Nicholas Pantazis
Senior Editor

1,020 1,467 1.4
@Craig it's definitely partly that, but it's also partly the price. The cost of the system plus a proprietary memory card puts it a good 75% more expensive than the 3DS which has a much stronger software library. It's just not competing well right now. That said, Sony can't afford to drop the price (not even close) so it'll likely be another year before it gets the price drop it needs.

Edit: $100 credit o_O are you insane? They'd lose tons and tons of money on that.

Edited 1 times. Last edit by Nicholas Pantazis on 10th August 2012 7:12pm

Posted:2 years ago

#4
Part of the problem with this debate is stereotyping F2P into just being about Facebook games. If you look at Sony's upcoming game "Playstation All Stars" for instance, it could benefit Sony quite a bit to let gamers download the client for free, and the pay $10 per character a la carte. This incentivizes the developers to make more characters, immediately creates a broader population to keep online multiplayer alive, and it means that gamers could end up paying way more than $60 to get a product that probably won't sell many millions of copies at $60 anyway. If 5 million people buy Parappa the Rapper and Kratos, isn't it better than 1 million people buying the boxed product?

Posted:2 years ago

#5

Greg Wilcox
Creator, Destroy All Fanboys!

2,178 1,127 0.5
No. $10 a character for a fighting game? Hell no - bad idea, period. That's worse than the Horse Armor in Oblivion and even Capcom fans who while about paying more for a dozen extra characters (for a lot less, mind you) would want to go after Sony if they tried that silliness.

Posted:2 years ago

#6

Ken Varley
Owner & Freelance Developer, Writer

40 30 0.8
I don't care what anyone says or thinks. The PS Vita is sinking quicker than the Titanic. The original PSP still did better, and that didn't fair good either.

Posted:2 years ago

#7

Adam Campbell
Associate Producer

1,170 954 0.8
I've said this so many times and even hoped for it before Sony made any new hand-held gaming devices, but a better version of what became the Xperia Play except with the full force of SCE behind it could have been the ultimate hand-held console, taking all the best features of a dedicated console and a smart-phone. They have also been incredibly slow to roll out Playstation Mobile.

The platform has so many issues and what I suggested could have offered a more open, more connected hand-held and multimedia device and something far more attractive to consumers and developers of all kinds. Of course, they could have had just a bare-bones, non mobile version too.

Posted:2 years ago

#8

Patrick Frost
QA Project Monitor

396 195 0.5
I think it's simple. Vita hardly does anything at all that other devices don't and don't do better. The benefit/cost balance is totally out of whack from the consumer point of view.

Posted:2 years ago

#9
But Greg, if you allow people to buy the boxed product, then you quell the anger of people who want to play as every character, and provide new avenues to support the online community with players who don't want to buy every character.

Edited 1 times. Last edit by Bill Garrison on 11th August 2012 9:05pm

Posted:2 years ago

#10

Andreia Quinta
Creative & People Photographer

221 582 2.6
Mental notes for Jack and Sony overall:

- Stop making stuff more expensive then everyone else, sony is no longer market leader & innovator to request certain prices (I'm looking at you Bravia's, Vaio's and SLR's)
- Stop inventing a new proprietary cards every 5 years. You are not the monopoly of technology, every one does not own everything Sony to stick a memory stick in, everyone owns stuff to stick SD cards in instead, prices and not trying to hold consumers under siege might explain its success.
- Stop making media wars just for the sake of it (Betamax/VHS, Blu-ray/HDDVD), nothing good came out of the last one, consumers had to hold back on what media type to buy since they didn't know who would win the piss fight.
- If your console doesn't have great quality titles at launch it will always sink at least for a year (looking at PS3's launch library,and now the Vita)
- Don't imitate, innovate. (The failure Playstation Move was and always will be)
- And I can't stress this enough, stop making stuff more expensive just because you were once SONY, you are just sony now.


And on a personal note, I don't need an epic console with amazing graphical features and long-run epic enthralling games. Me and the average user wants to nibble on a quick insta gratification game while commuting or waiting for the doctor appointment, that's why IOS and Android app games win, closely followed by the DS. You realize how many john and jane does you see on the underground every day playing Vita? None.
Why buy a dedicated (portable) console for epic long story driven games when I have one at home? Where I can give it my full attention without being interrupted by having to leave the next station or being called for. Instant enjoyment is what the average user wants without even realizing it, the core gamer is the minority.

Posted:2 years ago

#11

Paul Johnson
Managing Director / Lead code monkey

855 1,112 1.3
+1 for everything Natsuko just said.

You missed one off though. Have the three different Sony entertainments stop competing with each other and become a unified thing that developers can interact with. Getting approval for anything has always been bloody ridiculous.

Posted:2 years ago

#12

Bruce Everiss
Marketing Consultant

1,692 594 0.4
Jack Tretton surely doesn't actually believe that stuff he said.

Working in an office full of mad keen gamers it is no surprise to find that when they are spending their own money they are buying Nexus 7s rather than PS Vitas.

Also will someone please tell Jack that Android activations have now reached a million devices a day. This makes his 10 million Vita target for a year look very puny. And even that looks wildly optimistic.

As for free to play, it is amazing how many people are in denial of the reality in the market. Even the mighty Electronic Arts have admitted that free to play is an inevitability for all mainstream games.

Just now the game industry is the most exciting and dynamic it has ever been. Sure, bricks and mortar physical distribution is in its death throws, but this is more than compensated for by digital. The Apple App Store alone has 123,408 active games on it with 80 new ones added every day. It has over 400 million accounts with registered credit cards who have downloaded over 30 thousand million apps. This is the new reality.

Posted:2 years ago

#13

Robin Clarke
Producer

305 692 2.3
I think the truth as usual lies somewhere in the middle. There are kinds of games that are currently out of reach of the F2P model, but for which there is still substantial demand.

Posted:2 years ago

#14

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