Sony portable not ready by Christmas in US, Europe

[August 04, 2011]  TOKYO (AP) -- Sony's next-generation portable game machine, the PlayStation Vita, won't be available in the U.S. or Europe in time for Christmas -- a crucial sales period for game console makers.

Expectations had been high the machine would be ready worldwide for the year-end holiday shopping season. Sony earlier promised a "phased global rollout" starting late this year.

Sony Corp. Executive Vice President Kazuo Hirai said Thursday the PlayStation Vita will go on sale by the end of the year in Japan, and early next year in the U.S. and Europe.

Koki Shiraishi, electronics analyst for Daiwa Securities Capital Markets in Tokyo, said missing Christmas was a serious setback, especially overseas.

"That's when you do half your year's sales," he said. "This is going to prove painful for Sony."

Hirai did not characterize the timing as a delay, but said Sony wants to be prepared with solid game software offerings timed with the hardware launches.

He did not give specific dates, meaning that it was still unclear whether the gadget -- a touch-interface and motion-sensitive handheld that outdoes Sony's PlayStation Portable -- would be ready for Christmas even in Japan.

He was far more clear in flatly denying that any price cut for the PlayStation Vita was in the works, brushing off a decision by rival Nintendo Co. last week to slash the price of its 3DS, less than a half year after it went on sale -- stunningly quick in the industry.

"We packed so much into the device and made it very affordable," Hirai told reporters at Sony's Tokyo headquarters. "There is no need to lower the price just because somebody else that happens to be in the video game business decided that they were going to lower their price."

The PlayStation Vita will cost $249 in the U.S., and 24,980 yen in Japan for its Wi-Fi-only version, and $299 in the U.S., and 29,980 yen in Japan for the version that will also have a cell phone service.

Under its latest price cut, the 3DS will cost 15,000 yen in Japan starting Aug. 11, down from 25,000 yen. In the U.S., the price drops to $169.99 from $249.99 on Aug. 12.

Although game fans may be disappointed by the Vita's slow arrival, delays are rather common in the gaming industry.

Sony delayed the introduction of the PlayStation 3 home console a couple of times. Nintendo also delayed the launch of the 3DS, which meant it wasn't ready for Christmas.

But the Vita delay comes at a difficult time for Sony.

Sony, which reported a 15.5 billion yen ($199 million) loss for the April-June quarter, has suffered supply problems because of the March disasters in northeastern Japan.

It was also hit by a massive online security breach around the world, affecting more than 100 million online accounts.

Analysts say the maker of Bravia TVs and Walkman players needs to restore its reputation for innovative gadgets as Apple Inc. powers ahead with its iPod, iPad and iPhone.

Sony's TV operations have lost money for seven years straight amid price plunges, an oversupply of panels and intense competition.

Hirai -- widely considered a future chief executive of Sony to succeed Howard Stringer -- said the TV business is so crucial to an overall strategy that manufacturing must be kept in-house.

Ryosuke Katsura, analyst for Mizuho Securities Co., said the money-losing TV business was Sony's biggest problem, and stressed Hirai must turn that around to solidify his candidacy as the next leader.

"He isn't exactly a shoo-in, unless he can properly carry out the restructuring of the TV business," said Katsura.

Hirai promised Sony will no longer pursue sales volume and market share as it had in recent years, and will instead go for profitability with higher quality TVs to prove its products aren't mere commodities that compete only on price.

One thing Sony won't do is turn over the manufacturing to cheaper companies, an option some makers are adopting to cut costs while continuing to sell such TVs under their own brand. Hitachi Ltd. said this week it may stop making TVs in-house in Japan, following a similar move overseas.

While acknowledging he still didn't have all the answers, Hirai said keeping manufacturing, which he called "an art," as well as design and research within Sony was key for quality.

"For Sony, what we stand for and the user experience that we want to bring to all of our customers, the TV is an important and fundamental platform," he said.

[Associated Press; By YURI KAGEYAMA]

Yuri Kageyama can be reached at http://twitter.com/yurikageyama.

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