May 14, 2003 9:50 PM PDT

Sony bets on patience for handheld games

LOS ANGELES--Electronics giant Sony has been eyeing the handheld gaming market for years but held off until the technology and the market were right, a company executive says.

"We didn't want to come in and just replicate what others were doing," Kaz Hirai, president of Sony Computer Entertainment of America, said in an interview at the Electronic Entertainment Expo (E3) trade show here. "We wanted to come in and do it in a Sony way, in a way that will revolutionize the way people experience entertainment."

Sony announced plans Tuesday to make a portable game player, invading turf dominated by Japanese rival Nintendo for more than a decade. Sony's planned player, dubbed PSP, is set for release late next year. It will have an advanced 3D display, a powerful new processor developed by Sony and a new proprietary media format.

Hirai said Sony has held off on the handheld gaming market until now partly because the technology--everything from displays to MPEG video compression--wasn't advanced enough for a credible effort. Getting the technology right eventually meant developing a new optical media format, dubbed UMD, a small disc capable of holding 1.8GB of data.

Existing formats, including Sony's MiniDisc and Memory Stick specifications, didn't offer the right combination of capacity, price and porability, Hirai said. "There wasn't an optical media that really fit all our needs," he said.

Sony also bided its time to help build its position in the game market. With the PlayStation 2 firmly established as the leading home console, consumers and game developers are much more likely to trust Sony now when it introduces a new type of device, Hirai said.

"We've established a good relationship with consumers with the PlayStation brand, and we think now we can really leverage that relationship," Hirai said.

While the PSP will compete primarily with Nintendo's market-leading Game Boy Advance, Nintendo of America Vice President Perrin Kaplan didn't seem too concerned during an interview at E3. "We really don't know that much about it, and it's going to be 18 months before anyone sees one," Kaplan said of the PSP. "A lot can happen in 18 months."

Whatever Sony comes up with, Kaplan said, it's unlikely to have the mass-market appeal Nintendo has built for the Game Boy by keeping prices reasonable and emphasizing family-friendly games.

"Nintendo has always been a mass consumer company, and we understand what it takes to appeal to a mass audience," she said. "Part of that means not selling anything that costs more than a couple bags of groceries."

 

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