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Monday, February 5, 2007

"I cannot imagine a PlayStation 4"

Nomura Securities' Yuta Sakurai believes the PS3 will be Sony's last console; sees Hirai appointment as Segalike shift to software.

In the months leading up to the launch of the PlayStation 3 and Wii, barely a week went by without one analyst or another issuing proclamations of doom or promises of riches for both Sony and Nintendo. Now that both consoles are on the market, many investment firms' in-house game-industry experts are giving their assessments of the two companies' fortunes.

The prognostication reached a fever pitch today, when Sony Computer Entertainment (SCE) shuffled its executive lineup. Sony Computer Entertainment America (SCEA) president Kaz Hirai took over the position of SCE president Ken Kutaragi, who was promoted to SCE chairman and retained the title of SCE group CEO. Hirai will also be SCE's chief operating officer, and will relocate to Sony's Tokyo headquarters from SCEA's HQ in Foster City, California.

While Sony spun the changes as a "strengthening" of its executive team, many analysts saw it as a vote of no confidence for Kutaragi's stewardship of the PlayStation 3. The high-tech console's Blu-ray laser drive has been plagued by component manufacturing woes, which drastically limited supply of the console for its Japanese and North American launches, and delayed its European debut until 2007.

Some analysts went one step further, taking Hirai's succession as a harbinger of doom. No one was more pessimistic than Nomura Securities' Yuta Sakurai, who made the astounding prediction that the PlayStation 3 would be the last console Sony, the current console market-share leader, would ever make.

"The appointment of Hirai could be the start of a shift from hardware to software," said Sakurai. "I cannot now imagine a PlayStation 4." According to the Financial Times, Sakurai's reasoning is that "Hirai's new global portfolio puts a predominantly software-focused manager in charge of the company." His logic is reportedly that, with the emphasis moving to software, Sony would go the way of Sega, transforming from a console maker to a mere game publisher.

Critics were quick to point out that, despite its problems, Sony is primarily an electronics manufacturer, and has invested billions in the research and development of the PS3's technology. Despite the hyperbolic tone of Sakurai's comments, SCEA publicity chief Dave Karraker issued a polite response. "Following the launch of the PlayStation 3 just a few weeks ago, and witnessing the huge consumer demand for the product, I think it would be rather short-sighted for anyone to predict there might not be a next generation of PlayStation product."

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