The Confusion

We've discussed Sony's next-gen strategy at some length in this column before, but with each press conference, it seems that the firm's attitude to the market becomes more confusing.

In the wake of yesterday's conference in Leipzig, for instance, it's as obvious as ever that Sony's main focus at present remains firmly on the PS2 and the PSP - profitable platforms with healthy installed bases and thriving software sales.

This isn't surprising - indeed, we've previously attributed many of Sony's more unusual decisions with the PS3 (such as the ludicrous dance it played around the "value proposition" at E3) to a desperate need to avoid rolling over and crushing the PS2 by pushing consumers to next-gen too quickly.

As such, it wasn't a surprise to see SCEE boss David Reeves devoting a fair bit of time to talking up the PS2 in Germany - and noting along the way that the venerable console continues to outsell the Xbox 360 by a large margin.

That's an uncharitable stab at a rival, certainly, but also an important and sobering factor to consider in any discussion about the next-gen battle. Like the current spat between HD-DVD and Blu-ray, it's still a format war which has no relevance to the vast, vast majority of consumers, as they remain perfectly satisfied with their existing platforms.

Equally, plenty of time was devoted to the PlayStation Portable, a system whose sales have been rather eclipsed by Nintendo's DS, but which has been reasonably successful in its own right - and is almost certainly very profitable for Sony.

The big deal for the PSP in Leipzig, however, wasn't new games - or even the new PSP Slim And Lite hardware, which launches here in a few weeks' time. Instead, the likes of God of War, WipEout Pulse and Pursuit Force were given short shrift in favour of new "services" for the system - non-games software which Sony hopes will push the console out into new markets.

So now you'll be able to use instant messenger and voice chat over wireless networks using Go! Messenger, work out travel plans and find local services on the GPS-enabled Go! Explore, and view television content from Sky on the move using yet another Go! branded service.

None of this is in any way a Bad Thing, but it's an unusually scattergun approach to take with a product. Sony's strategy here, it seems, is to add functionality until a tipping point is reached where the device has enough desirable elements that consumers can use to justify the purchase to themselves.

That's logical enough, but leaves very unsettled feelings about the future of the platform. The concern is that the PlayStation brand is becoming very diluted by Sony's determination to focus on things that aren't, well, Play.

A similar issue exists with the PlayStation 3, and it's here that there's real confusion about Sony's intent in the market. The addition of a digital tuner and Freeview function to the console is a logical step, which allows it to act as a hard disc recorder for television - not exactly earth-shattering, since such devices can be bought for under a hundred pounds, but certainly a nice addition to the console's value.

However, the focus in Leipzig zoomed in tightly on this announcement - and, curiously, on social gaming, with strong focus on next-gen iterations of Singstar and Buzz. Both of those are fantastic franchises, but it's not apparent where Sony thinks they're going on the PlayStation 3.

That area of social gaming, pioneered by SCEE over the last few years, has largely been enabled by the enormous market penetration and low price point of the PlayStation 2. On the PS3, with a small installed base that hasn't even reached most of the "hardcore" market yet, such products just look out of place - and it's downright confusing as to why Sony would even want casual game fans to switch to the (loss-making) PS3 right now, ditching the (profitable) PS2 in the process.

The problem here, then, isn't a million miles away from the issue perceived with the PSP. Both platforms find themselves being advertised as something that isn't a videogames console; instead, they're being pushed harder than ever as multi-function entertainment and media devices, systems which have "something for everyone" regardless of whether you're into games or not.

Because of this, there's a very real risk that Sony's message will find itself trapped between a rock and a hard place.

On one side, you have the traditional early adopters of PlayStation hardware - the millions of gamers who formed the core audience for the PS2, and whose influence and advocacy should not be underestimated when considering the reasons for the success of that console. If not actually neglected, those people certainly feel unloved right now, and worse, they feel that they're being asked to pay above the odds for non-gaming functions when they just want a games console.

On the other side, you have the more casual, mainstream audience who adopted the PS2 late in its life - or who haven't previously owned a games console. This is a rich vein indeed, as Nintendo could attest - but Sony's mistake here is that it is attempting to leap straight into this market without first winning over the early adopters.

By doing so, it is missing out on the crucial word of mouth and advocacy which it gained from the early adopter market in the last couple of generations - indeed, it is actually generating negative word of mouth, which is damaging its prospects immensely. Without that positive advocacy at a grass-roots level, the firm's products face a daunting prospect - trying to sell a hugely expensive PlayStation to people who don't want a PlayStation, and aren't even sure if they want an integrated, all-singing, all-dancing media centre.

With the battle between HD-DVD and Blu-ray taking another awkward twist this week as Paramount and Dreamworks hopped back on the HD-DVD wagon (assisted ably by around USD 150 million of inducement from Microsoft, if industry scuttlebutt is considered trustworthy), Sony cannot rely on an early victory in the next-gen DVD battle to lift it out of its sales slump.

Instead, it needs to focus its efforts on retaking what it foolishly assumed was its home territory - the core market of gamers who make up the bulk of sales for any console (except, perhaps, the Wii) in its first two years on the market.

This week saw Microsoft drop its price points and begin the first of the massive software launches which will carry it through to Christmas. Certainly, there is a question mark over Microsoft's ability to continue the momentum of the Xbox 360 past the hardcore market. But ironically, while Sony demonstrates a great understanding of how to break out from hardcore adulation to mass-market success, right now the firm seems to have forgotten how to accomplish Step One.

The software and services are, arguably, on the way - but the message needs to be fixed. It's time for Sony to get back to basics, and sell us again on what the PlayStation does best - Play.