UK retail shrugs off "irrelevant" PS3 pricing fears

It has proved the most controversial announcement to emerge from E3 2006 - but UK retail has nevertheless cautiously backed Sony's PlayStation 3 launch strategy, believing pricing issues to be largely irrelevant with a pre-Christmas sell-out likely.

Early adopters are expected to devour initial shipments of the console - set to launch at GBP 425, as revealed last week by GamesIndustry.biz. But specialist vendors and analysts are now warning that the Japanese giant faces a far stiffer challenge in convincing the wider market to adopt Sony's crucial Blu-Ray next-gen DVD technology.

"Given the machine is likely to be a sell-out this side of Christmas, I think the price point is irrelevant for the first six months," specialist retail chain CeX' marketing manager Jonathan Cronin told GamesIndustry.biz. "The launch frenzy will be there - this is the new PlayStation, not the new Xbox. Four million units globally before Christmas? I don't think you'll be able to buy one off the shelf."

"We welcomed Sony's PS3 announcement at the E3 convention, putting an end to the speculation surrounding a UK launch date," offered Gamestation group product manager Anna Downing. "The November 17th date sets up an extremely competitive and exciting Q4, with consumers potentially having the choice of three 'next-gen' consoles on the market. We're anticipating that demand will outstrip supply."

Steve O'Brien, boss of leading independent retailer Action Replay, agrees. "With the amount of product coming into the UK I think Sony could have quite comfortably priced it at twice the price and still sell-out twice over," he suggested. "In the first round of any console sales it's the fanboys and hardcore gamers who buy it. I think the strength of the brand is key."

With hardware shortages a certainty during the launch window and no confirmation on UK-specific number, however, most retailers are expected to refrain publicly from criticising Sony's pricing strategy for fear of risking their allocation.

But regardless of this, not everyone was so charitable. "Such high prices are a difficult thing to push at retail level especially with the continued problems of distribution, release dates, and product availability that have dogged UK product releases for some time," insisted Steve Aspinall, owner of indie V-Ten Entertainment. "And that's without the mass-discount culture convincing the consumer to wait a few months, and the uncanny shortage of convincing software for the platform, not to mention the continued implication that next gen gaming cannot take place without a next-gen television set."

Many, including Sony itself, certainly agree that the firm faces a serious challenge in convincing consumers to buy into Blu-Ray - fingered as one of the main causes of PS3's hefty price tag - as it enters a format war with Toshiba's rival HD-DVD technology. Particularly if they are to swallow SCE UK boss Ray Maguire's assertion that PS3 is a "bargain".

And with Microsoft hinting that Xbox 360 plus the standalone HD-DVD player due this Christmas will weigh in for less that Sony's system, pressure continues to pile on the market leader.

"If you've got a PS3 next to a 360 you need to be able to see the difference if you're going to be asked to pay more. Microsoft must be pleased there's a nice price differential there," commented CeX' Cronin.

"People will say PS3 is expensive because they haven't got a clue what's in it - they just see it as another box to play games on," argued leading videogames industry analyst Nick Parker of Parker Consulting.

"It's totally abstract to the consumer, a lot to get your head around. Sony has future-proof technology - everything you'll need if you're seriously into accessing games, movies or music on demand."

"It's getting people to understand that their DVD player is basically going to be out-of-date in a couple of years' time. If you buy a PS3 now you'll get a games machine and next-generation movie technology," Parker continued.

"When PS2 came out DVD was already understood by the consumer - but who knows what Blu-Ray is? Sony needs to convey the value in the price; it's a longer term problem for them."