Bloomberg News

Sony Monitors PlayStation ‘Issues’ as Sales Top 1 Million

November 18, 2013

Sony Monitors PlayStation ‘Issues’ as Sales Top 1 Million

Brenden Hartnet, left, and Sydnee Mencuri, center, celebrate after purchasing the Sony PlayStation 4 console during its midnight launch event in San Francisco, California, U.S., on Thursday, Nov. 14, 2013. Photographer: Erin Lubin/Bloomberg

Sony Corp. sold more than 1 million PlayStation 4 consoles in North America during the first 24 hours of sales, though the company said some buyers reported glitches including the device suddenly turning itself off.

The sales, which top initial results for the predecessor PlayStation 3 in 2006, come as Chief Executive Officer Kazuo Hirai tries to make the video-game console the centerpiece of a corporate turnaround strategy. Pressure has intensified on Hirai after the company last month surprised investors by reporting a second-quarter loss.

Sony is getting a head start on competing for the attention of game players with Microsoft Corp (MSFT:US)., which is releasing the Xbox One later this week. The Tokyo-based electronics maker has priced its console at $399, or $100 less than the Microsoft machine, as it seeks an edge in the $93 billion-a-year industry before the Christmas shopping season. Some players said the power-indicator light blinks before the device shuts down.

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“No other consoles in the U.S. sold 1 million sets during the first day, so I think having some issue is not unusual,” Hideki Yasuda, an analyst at Ace Research Institute in Tokyo, said by phone. “In the long term, the major problem will be whether it can continue to provide interesting game software.”

‘Isolated Incidents’

Sony is aware some consumers reported issues with their PS4 systems and is monitoring for additional reports, Satoshi Fukuoka, a Tokyo-based spokesman, said in an e-mail today.

“We think these are isolated incidents and represent a very small percentage of total units shipped to consumers to date,” Fukuoka said, declining to elaborate. The company is still making and shipping the consoles, he said.

The company’s website said problems associated with the blinking light include no picture or sound coming from the television.

Sony American depositary receipts rose 1.9 percent to $18.85 at 1:52 p.m. in New York. At the close in Tokyo, Sony rose 0.9 percent to 1,862 yen. The benchmark Topix index gained 0.2 percent.

Adequate Supplies

Nintendo Co. also faced criticism last year after its new Wii U console required an immediate firmware update out of the box, and some consumers complained their machine was damaged during the process.

Sony will have adequate supplies of the PS4 through Christmas and stands by earlier projections for sales of 5 million units by March, Jack Tretton, president and chief executive officer of the company’s U.S. computer entertainment division, said Nov. 11. The device goes on sale in Europe and Latin America on Nov. 29.

The initial sales are “a good indicator of a console becoming a hit,” Shunsuke Tsuchiya, a Tokyo-based analyst at Credit Suisse, said in a report today. “The strong software launch lineup for the PS4 is probably one reason for the healthy level of preorders.”

Mobile Threat

Sony is employing a newer, faster type of memory that could provide an edge with graphics and help win over hardcore game players. The company also will benefit from efforts to woo independent developers, according to Andrew House, head of Sony’s worldwide game operation.

Both Sony and Redmond, Washington-based Microsoft are responding to shifts in the video-game industry, especially the loss of players to tablets and mobile phones. To spur sales, Sony and Microsoft are offering powerful Web-connected consoles capable of delivering games and entertainment, such as TV, films and music.

Sony’s previous version of the console, the PS3, sold 197,000 consoles in the first month after it was released in the U.S. on Nov. 17, 2006, NPD Group, which tracked sales of video games and consoles, said at the time.

To contact the reporter on this story: Grace Huang in Tokyo at xhuang66@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net


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