Sony Talks 2010: "Project Natal and Wii are going to have trouble"

ohn Koller, Sony's head of
PlayStation marketing, reveals how the PlayStation Network will expand
tremendously in 2010, and why Project Natal and the Wii are going to be
in "trouble" when the PS3 launches its own motion sensing technology.

With the launch of the PlayStation 3 Slim, Sony is charging headlong into what may be their biggest year yet. Aside from headlining smash hit exclusive titles such as inFamous and Uncharted 2 -- not to mention the looming presence of God of War 3
-- Sony's also putting huge emphasis on the growing PlayStation Network
and PS Store. But will it be enough to vault the former empire ahead of
the competition? We sat down to talk about the future of the
PlayStation brand with John Koller, Sony's head of PlayStation
marketing, and he's sure that his company's brand is headed for a
bright future.





John Koller, Director of Hardware Marketing






GP:What's Sony's plan for the PlayStation 3 going into
2010? With the launch of the Slim, PS3 sales have been high, but how
are you going to keep the momentum going?



Koller:
We look at that everyday. Taking a step back, prior to the start of
this year, the marketing efforts for 2009 really were based on toning
the brand, to soften the brand a bit. There was a lot of confusion
about what the PlayStation 3
is and what it does, particularly with the parents, the families, the
moms, and the gatekeepers. There were a lot of concerns. It was the
big, black technical box-in-the-corner. It was fantastic, and it did a
lot more than everything else in the market, but we just didn't know
what it meant to us as consumers. Our objective going into this year,
knowing that the price cut was coming, was to ensure that no consumer
left a retail counter or store without a full understanding of what the
PS3 is and does.





GP:What about the future of the PlayStation Network? Kaz
Hirai stated that Sony is looking for ways to expand the service,
hinting that there might be a paid subscription of PSN similar to Xbox
Live.




Koller:
I think just looking at the way the PlayStation Network is expanding is the more mercurial area of your question. It's becoming a bigger focal point of our business overall. With the PSP Go
launch, it's entirely reliant on the PSN. Now we're able to add not
only gaming functionality, but also our video delivery service and the
varied other ways the PSN adds to the PS3 experience. I think the PSN
is going to end up being a critical part of what we do in 2010. The PSN
is going to be very important. We'll add a number of very critically
demanded features, and also continue to look for ways to expand on what
the PS3 consumer has asked for. The PSN is really a big pillar where
we'll go. Those are going to be three big pillars as we go into 2010,
motion control gaming, 3D gaming, and the PlayStation Network.



... Shooters and sports games... they're areas
that quite honestly, I think Project Natal and the Wii are going to
have trouble matching, from a differentiation standpoint. We look at
motion control as being that much more than what exists on the market.
The Holy Grail of gaming is placing you as a consumer into the game
physically.






GP: What kinds of upcoming PS3 titles will benefit from motion control?



Koller:It's a pretty seamless toolset that's going to
accent gameplay substantially. In terms of the best types of games, I'd
say that right now we're looking a real wide variety of genres that can
utilize the technology. I think the areas that are going to be really
critical to our success will be family games, as well as shooters and
sports games. Those are going to be the areas that will really define
success, because they're areas that quite honestly, I think Project Natal and the Wii
are going to have trouble matching, from a differentiation standpoint.
We look at motion control as being that much more than what exists on
the market. The Holy Grail of gaming is placing you as a consumer into
the game physically. When we provide further details, people will see
exactly where we're going, not only from a technological standpoint on
the hardware, but also where the gameplay is transitioning. It's going
to be a really exciting launch.





GP:What does Sony think about the future of the PS2, in
relation to the PS3? Lots of people are still buying games for the
PlayStation 2, and Sony's gone on record saying they would consider
having PS2 games that could be purchased on the PSN Store. Does Sony
have a firm stance on what they're going to do with trying to support
PS2 games?




Koller:
Yes, we have a very firm stance, and we're going to continue to support the PlayStation 2 wholeheartedly. The PS2 obviously had a price drop this year,
which gets forgotten because of the PS3 noise, but it's still selling
exceedingly well. It's a new demographic, a consumer that's maybe a
"last gamer" or a consumer that's new to gaming. With this economy,
coming in at $99, a lot of these consumers are choosing between a
PlayStation 2 and a Wii, and you're looking at a PS2, which is $99 and
carries 2000 games.

Increasingly, we're getting a lot of traction on the PS2. It's been a
very, very strong year with the PS2, and we're going on our 10th year.
It's pretty unprecedented, and we're not looking to slow down anytime
soon. Next year will be another year where the PS2's going to be fully
supported. A lot of key games and titles are coming, both first and
third-party. It's going to be another big year for the PlayStation 2.
That particular consumer, the person who's coming into the PS2 world,
is then ripe for integration into the PSP and PS3 as we go along that
loyalty curve. We know that prior PS2 consumers are now coming to the
PS3 in droves since the last price drop,
so we view each of the new consumers for the PlayStation 2 at the $99
price point as a potential PlayStation 3 and PSP consumer down the
road.


With the backwards compatibility issue... it's
really become far less of an issue than I think a lot people --
particularly the media -- are asking about. In all of our studies,
we've noticed that it's fallen off the map in terms of demand. There's
not many requests for it much at all anymore.






GP:
Do you think that the high sales of the PS2 are going to keep backwards compatibility off the table for the PS3?




Koller: That's not necessarily the reason, but PS2 sales
and the sheer amount of games certainly add to what the PlayStation
Nation can experience with PlayStation consoles. There's such a wide
variety and diverse lineup of games on PS2 and PS3. For a particular
consumer that wants to play all his titles on PS2, and if he's new to
the market, he can do so with the 2000 games that are available. With
the backwards compatibility issue, we're at a point now in the cycle of
the PlayStation 3 that there's so many PS3 games available, so many
strong PS3 games, that it's really become far less of an issue than I
think a lot people -- particularly the media -- are asking about. In
all of our studies, we've noticed that it's fallen off the map in terms
of demand. There's not many requests for it much at all anymore.
There's really a high level of satisfaction on the PlayStation 3 for
PS3 games themselves.












GP:
What games do you feel are going to be the most crucial titles that Sony's going to rely on during 2010?




Koller: Well, let's start with God of War. God of War III
is going to be what many, and maybe most, games really aspire to be.
It's an absolute, fantastic ending to the trilogy. Just seeing some of
the gameplay around here, hearing everybody yell and scream when they
play it at night with some of the early copies -- it's going to be
exciting for the market. It's going to be a fantastic game.

Obviously, we're still seeing strong sales right now for Uncharted 2.
For the first couple of months in 2010, coming out of the holidays
we're still going to see the Uncharted 2s and the inFamouses and
whatnot still do exceedingly well. Going into the back half of the
year, we have a number of key launches. We haven't really announced all
of them yet, but the titles that will be launching at the time are
going to be very exciting. Some of the big franchises, as well as new
IPs have new ways to game, not motion control gaming, but in other
ways. It's going to be a really strong lineup. On the third-party side,
the same is true. We've said this a lot, but strong sales really
dictate development. Because of the strong sales we're seeing right now
on the PS3, we're getting more investments and development from
third-parties and first-party groups. The future is really bright for
the type, quantity, and quality of games that are going to be coming to
the PlayStation 3 in the next few years.

GP: We also wanted to ask about the PSP Go. How is the PSP Go going to change going into 2010?




Koller:
So, there's a few things that we're looking at for the PSP Go,
but the most critical thing is that we're fighting to ensure that we
get parity on launch dates. We've noticed that has been one area for
PSP Go owners that they've asked about, since they want to be able to
get their titles at the same time as the "physical goods" consumer, the
PSP 3000 consumer. That's one area that we're going to continue to
emphasize. We are making plans for it and have launched that strategy
on the first-party side, but we're going to emphasize that for
third-party. It makes sense. I think that given the type and sheer
amount of consumers that believe in digital distribution, we need to
ensure that they get their games when they want them.


We are over-forecast on what we thought we'd be selling on PSP Go,
so we've been very pleased. Going into 2010, there's discussion about
how best to message the type of games that are coming. It's safe to say
that retail hasn't played as large a role in the types of software
that's coming, digitally. They don't have a "dog in the hunt,"
necessarily, so one of our key challenges is to really help out that
person coming to market that wants a PSP Go, and letting them know at
retail what kinds of games are available to them on the PlayStation
Network. You're going to see a lot more in-store messaging and
promotions surrounding the types of games that are going to be
available.











GP: Since Sony's taken such an active role in trying to
give consumers a lot of choice in what they can download through the
PlayStation Store, does Sony find that it's a lot easier to sell things
like comics and movies now that they have the access that they do with
the PSP Go and PSN?






Koller: Yeah, there's no doubt at all. We've added a lot
of functionality and features to the PlayStation Network. It lives
because people are making those return trips. We're starting to see a
lot of traffic in the PSN solely because of the PSP Go. We've made
public a few of those statistics, but our revenue numbers on PSN are
substantial. The PSP Go is contributing a really significant amount of
revenue to the PlayStation Network just because it's required.
Consumers coming to the PSN are increasingly interested in the great
software lineup for PSP, but also some of the other things that are
available -- the video download service, the comics. There's a lot of
things they can do once they get to the PlayStation Store.
Getting consumers registered for free really opens up a real wide range
of content and options. That's really the goal, "How do we get people
to be aware of what's available on the PlayStation Network?" Having
them purchase a PSP Go and register is really the big gaming function
there.


With this economy, coming in at $99, a lot of
these consumers are choosing between a PlayStation 2 and a Wii, and
you're looking at a PS2, which is $99 and carries 2000 games.





GP:
As Sony gets more people buying the PS3 Slim, coming to the PlayStation
Network with the PS3, and the PS Store with the PSP Go, is it becoming
a bigger project for Sony to try and support users on this free
network? Or is it just a case of having a solid online system and
seeing where the glass ceiling is?




Koller: I think it's that usual combination of both. We've certainly been able to add a lot of really good features. I think that PSP
consumers certainly appreciate not only the new titles, but there's a
lot of catalog titles that we really worked hard to make available
prior to launch. At launch, we had 225 games from prior years available
and there's certainly a really strong demand for those games as well.
It's not only the consumer that's just coming in and saying, "Oh, I
heard that LittleBigPlanet's now available in the Store." It's that person that says, "LittleBigPlanet's available, but I really liked GTA: Liberty City, and I can get that now. I really like Dissidia
as well, and I can get that now." There's so any options available to
them, there's never an "out-of-stock" situation, and there's never a
choice by a retail buyer whether or not to carry a title. All those
titles are available now, and I think that's the beauty of the network.





GP: Do you think that there's any more big changes that'll
come to the PS3 in terms of hardware and the way that it's built? Or do
you think that we're going to get ready for the PlayStation 4 somewhere
down the road?





Koller: Well, I will say this -- there's no plans in place
right now to be changing the current model of the PS3, since we just
launched this one. We're getting this into market and obviously getting
a lot of traction. That said, in terms of Sony as a broader entity,
we're built on innovation and a lot of what you'll see in terms of
changes to the PS3 are going to be done through firmware for the
foreseeable future. There's a lot features and functions we have
planned there. I think that 2010 will be a big year for that. I also
think that it'll be a big year on that software side, whether it'll be
3D gaming or any of the other really big franchise titles that are
coming to the PlayStation 3.