The State of Gaming, Part 1

Considering Sony's utter domination of the video game market—the company has sold more than 60 million PlayStation 2 consoles, compared to one-fifth that number for the Microsoft Xbox and Nintendo GameCube—you might think we won't see any interesting developments in this market until the next-generation systems ship sometime in late 2005. Nothing could be further from the truth. Video game platforms, like computer OSs, follow predictable trajectories that we can use to measure the level and quality of software releases. And now, roughly halfway through the life cycle of each of these machines, we're finally seeing developers truly taking advantage of the unique abilities of the underlying platforms. Here, then, is the state of gaming, circa mid-2004.

Sony PlayStation 2, PSP, and PSX
Sony released the PlayStation 2 in Japan in March 2000, following up on the enormous success of its original PlayStation 1 system. Like its predecessor, the PS2 brought with it a number of innovative, market-leading features that, in some ways, its competitors still don't match today. But technology has little to do with the PS2's success: Sleek and Death Star-black, the PS2 cuts an impressive, professional-looking figure, even today. Eager fans immediately catapulted the PS2 and its many accessories to record sales: By the time Sony launched the PS2 in North America in October 2000, the company had sold more than 3 million units in Japan alone.

On paper, PS2 technology is still fairly impressive, although it's clear the machine can no longer keep up with the most sophisticated desktop PCs available today. The system features a 300MHz 128-bit RISC processor (dubbed the "Emotion Engine"), MPEG2 decoding in hardware, and incredibly fast RAM access. At the time, the PS2 made mincemeat out of the comparatively lowly competition in head-to-head comparisons, humbling systems such as the Sega Dreamcast. Helping matters, Nintendo and Microsoft were 18 months away from fielding their next-generation game systems, giving Sony a huge head start.

Most important to gamers, of course, are the games, and this is where Sony's high-volume strategy pays off most. From the start, Sony ensured that its video game platform was supported by the most popular software titles, and backwards-compatibility with PS1 titles ensured that users of that system had an obvious upgrade path. By the time the units launched in the United States, more than 25 titles were available, including Dead or Alive 2, Madden NFL 2001, SSX, and Unreal Tournament. Today, with more than 2000 software titles and more than 400 million games sold, the PS2 seems unstoppable.

It's not just software, of course. With more than 60 million units sold and an entire cottage industry based on peripherals, it's equally clear that Sony now writes the rules for this generation of video game systems. Advances touted by rivals—such as the Xbox's hard disk and Ethernet connection—have been duplicated through add-on products, and Sony even dominates the online gaming realm, despite having introduced its network adapter only after Microsoft announced the feature for the Xbox.

New Games
So what's new with the PS2 in mid-2004? First, thanks to the almost desperate flailings of its competitors, the PS2's price is now lower than ever at $150, opening up the console to a new round of sales as holdouts open up their pocketbooks. On the software side, expect this year's crop of games to be the most technically sophisticated yet. Next-generation titles such as Madden NFL 2005, MegaMan Anniversary Collection, ShellShock: Nam '67, Commandos Strike Force, and Ace Combat 5 are all due by late 2004, and many of them will include online play. You can even pick up a Linux for PlayStation 2 kit, which turns your favorite console into a full-fledged Linux computer, complete with PS2-black mouse and keyboard.

But the biggest news in the PS2 world today is only peripherally about the PS2. Late this year, Sony will unleash its Portable PlayStation (PSP), a "21st century Walkman," as the company describes it. Scheduled to go head-to-head with a Nintendo handheld system called the Nintendo Dual Screen (DS), the PSP is a portable video game system that features a black, PS2 controller-like form factor, a 4.5" 480 x 272 widescreen display, and two microprocessors. Early demos of the unit show a photorealistic graphics engine that rivals that of the PS2 itself.

But as with the PS2, it's the games that will ultimately set this unit apart from the competition. And since Sony knows it's won't have a huge head start with this system, as it did with the PS2, the company is planning an unprecedented number of launch titles that will run on the unit's interesting and proprietary new disc format, Universal Media Disc (UMD). More than 100 game makers are planning titles for the PSP, including games as diverse as Gran Turismo 4 Mobile, Metal Gear: Acid, Wipeout Pure, Twisted Metal: World Tour, Need for Speed Underground, Tiger Woods PGA Tour, and 989 Sports MLB 2005.

So, both the PSP and PS2 play games, sure, but what's the connection? Well, it turns out that Sony will steal a page from Nintendo's playbook and ensure that the two devices interoperate. Although ever-secretive Sony isn't supplying many details yet, the company recently introduced to Japan a next-generation version of the PSP console, dubbed the PSX Entertainment Center—essentially a PS2 with a bundled hard disk, recordable DVD drive, and digital video recording (DVR) software. This unit will go on sale soon in the United States, and analysts believe Sony will let customers download video content to the PSP, so it can be viewed on the road. This prediction makes some sense: Sony has been touting its so-called "ubiquitous network strategy" of late, despite having very few products currently that live up to that term.

Whatever the company does, expect it to be trendsetting and bestselling: Sony didn't get to its current position in the video game world by sitting on its laurels, and its innovative work to connect its many disparate products could pay off for loyal Sony customers in the future.

Stay tuned for Part 2, in which I'll cover Microsoft and Nintendo.

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