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Pride Goeth Before The Fall

It wasn't that long ago that Sony looked invincible in the video gaming world.  The PS2 was the most popular game system on the planet and one of the most popular in history, eclipsing it's own PSX.  Sony readied the PS3, viewing it as a portal for the entertainment center.  Blu-Ray!  DVD!  Media sharing!  Games!  Online communities!  That and the PSP, their portable game system, would secure their dominance in video games for the next cycle.

They unrepentantly snarked at Nintendo and their strategy for the Wii.  The Wii was only a game machine, and one with a gimmick, and one aimed at younger audiences and casual gamers.  And on outdated hardware!  (It's mostly a GameCube in there.)  Nintendo had lost major ground since the SNES days, and they would never catch up.

Then, the PS3 launched with a $500 price tag.  $300 is the general price point for mass acceptance.  I actually saw PS3's in the wild long before I saw Wii's.  The Wii's couldn't be kept in stock.  The PSP's at one point had five times as many movies as games.  Sony was so sure people would want to buy their wonderful movies, they couldn't understand why a special DVD you could only play on a handheld machine with no special features for the same price as a DVD wouldn't sell to people who already had DVD players and laptops.

The PS3 has started doing okay, mostly because it's lasted so long.  But the game division is in massive trouble.  All you need to know is that Square/Enix, of which Sony is part owner, is making games for other systems now.  Developers are avoiding the PSP because the user base just isn't there.  Sony loses money on each unit sold (because the tech in the Wii is so old, Nintendo makes about $50 on each one they sell).  This deficit spending is part of the business plan -- you lose a little on the unit, but make up the money on the software sales.  But software sales aren't doing well, either. 

The PSP itself?  Sony says the problem is piracy -- people bend the hardware to load games off the memory stick.  Sony's solution was to make the PSPGo, where you can only download games to the memory stick.  That not only wasn't working, but you can still buy the original PSP with the UMD drive.  It hasn't phased out.  So that isn't working either.

The new PSP is being readied for release.  Sony apparently is offering both downloadable and removable media.  Instead of the UMD, it has a special flash drive.  It's a regular flash drive but resized (and probably rearranged pins) to dissuade piracy.

How is this going to work?  Not at all.  If you're a pirate, you just wait until people dump their old games on eBay for a few bucks and wipe the drive.  And if it's just a memory card, you know the grey market will have copies on the market within a few weeks, just like they do with save cards for the Playstation and GameCube and....

Sony has recently announced an initiative to make their games available for the Android.  I think they'll see far more growth there than they will with the new PSP.

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