By Franklin Paul
Thousands camped outside of stores on Friday to be among the first
U.S. buyers of Sony Corp.'s new PlayStation 3 video game machine, but
violence marred the debut when one man was shot outside a Connecticut
store.
Connecticut state police said two armed men confronted the 15 to 20
people waiting a Wal-Mart to buy a PlayStation at about 3:15 a.m. EST
and demanded their money. The wounded man refused to handover his
wallet and was shot, police said.
The man, who was not further identified, was in serious condition at a
Massachusetts hospital. Police were looking for the suspects.
But in most places, U.S. gamers who flocked to electronics stores
turned the wait into a social event as they camped out, some for
several days, in a test of Sony's (6758.T) grip on the $30 billion
gaming industry.
Thumping music and finger food were showered upon weary shoppers
outside of Sony's midtown Manhattan store. They turned discarded bags
of shredded office paper into billowy chairs and a lamp shade
sheltered one man from the rain.
Sony is sure to rake in millions of dollars in revenue on Friday
alone, with some 400,000 units expected to be available, one week
after the initial launch in Japan.
Depending on the hard drive, each PlayStation 3 sells for either $500
or $600 and Sony aims to make 1 million units available in the United
States by the end of the year.
Some gamers also sought to turn their wait into a quick profit,
hawking new consoles for up to $5,000 on Internet auction site eBay
Inc., with outlying bids reaching $30,000.
Friday morning's generally celebratory tone overshadowed what had been
a tough year for Sony, following a recall of nearly 10 million of its
computer batteries, delays in the PS3 and a growing price war in the
flat screen TV market.
Sony shares closed 1.3 percent higher at 4,770 yen in Tokyo on Friday.
PS3 PARTY KEY TO TURNAROUND
Sony is expected to lose money at first on each PS3 sale. The unit can
also surf the web, download video and music and play movies with an
advanced Blu-ray high-definition disc drive. But high production costs
have dragged Sony's game unit into a deep loss for the year through
March.
Shrugging off his company's woes, Sony Chief Executive Howard Stringer
made light of himself before a crowd of gamers, most dressed in
sweatshirts, jeans and T-shirts.
"I know I'm standing here in a stupid suit, but I'm actually happy,"
he told the crowd.
Experts suggest each PS3 could last 10 years and go a long way toward
helping Sony stay atop the gaming market, as well as make Blu-ray the
standard for next-generation DVDs.
"Gaming is our primary focus, but the PS3 does so much that it can
become the center piece of a home entertainment system," Kaz Hirai,
chief executive of Sony Computer Entertainment America said in an
interview.
But some analysts say the PS3's high price could deter non-gaming
consumers and open Sony up to stronger competition from Microsoft
Corp.'s Xbox 360 and Nintendo Co. Ltd.'s (7974.0S) Wii. U.S. sales of
the Wii start this weekend.
"They will sell out of the 400,000 (units), with the hard core
gamers," said IDC analyst Danielle Levitas. "But with Blu-ray, they
are betting their strongest business unit on a technology that it's
not clear most consumers want."
Only about 500 PS3s were available for sale at the midnight Friday
launch, officials said, leaving hundreds out in the rain holding on to
promises that more boxes would be made available when the store
reopened at dawn.
In Boston, hundreds of gamers were turned away from a Best Buy store
after police said the outlet didn't have a permit to open at midnight.
Angel Paredes, who waited four days through rain storms in New York,
was the first to buy a PS3 in the U.S. and vowed he would not put it
up for sale. Kamau Romero, 24, an educator, who was No. 3 on the line,
was not so certain.
"It would take a lot to get it out of my hands, but it is possible. You
never know," Romero said.
(Additional reporting by Kenneth Li and Nick Olivari in New York, Lisa
Baertlein in Los Angeles, Eric Auchard in San Francisco and Svea
Herbst-Bayliss in Boston).
Copyright 2006 Reuters Limited.
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Franklin Paul (reuters@telecom-digest.org)