Sony Rejects Web-Based PlayStation Console

Originally published May 30, 2012

By Ian Sherr

Sony Corp. considered but ultimately rejected a download-only plan for its next videogame console, people familiar with the matter said, opting to include an optical disk drive rather than break with decades-old industry practice.

The Japanese electronics maker’s flirtation with dropping the optical drive underscores the rising importance of online networks in the videogame industry, which allow console users to download games, television shows and music without the need for disks or cartridges.

Sony is planning a 2013 release for the successor to its PlayStation 3 console, people familiar with the matter said.

Consoles without optical drives would likely add to pressures on brick-and-mortar and online retailers that sell game disks.

But Sony decided against a download-only model largely because Internet connections are too inconsistent around the world, one of the people familiar with Sony’s thinking said. Because game files are large, customers in countries where Internet connections are relatively slow would be hobbled by a requirement to download games, the person said.

A Sony spokesman declined to comment.

Microsoft Corp. is planning to include an optical disk drive in the successor to its Xbox 360 console, according to a person familiar with the matter. The software company also had concerns about access to Internet bandwidth, the person said.

A Microsoft spokesman declined to comment.

Both console makers have taken an unusually long time to update the hardware that is crucial to driving demand in the lucrative game category. Prospects for new consoles are likely to be a hot topic at the E3 videogame exposition in Los Angeles next week, though the only formal announcement expected is a successor for Nintendo Co.’s six year-old Wii, the Wii U.

The success of a new PlayStation is especially critical for Sony and new Chief Executive Kazuo Hirai, who is trying to stop financial bleeding in the company’s other electronics operations. As a bright spot in the struggling conglomerate, the games business is also the prime example of how Sony plans to deliver content to its devices using its online network.

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(Published May 30, 2012, in The Wall Street Journal.)