PlayStation II Makes its Debut with Sony Stock on a Tear
BAY: On a day of big winners, many stocks hit new 52-week highs, including Hewlett-Packard, Intel, Morgan Stanley, Motorola and News Corp. In other corporate news, communications chip maker PMC-Sierra opened its coffers to buy two privately held semiconductor firms, AA Netcom and Extreme Packet Devices. The cost: more than $1 billion in stock. And Bank One warned of more trouble weighing on the bottom line. The country's number-four bank, which has been hit by weakness in its credit card business, issued its fourth earnings warning since last summer. And Healtheon-WebMD reported that its losses grew heavily in the last quarter. The online health-care company said the red ink swelled to $49 million in the fourth quarter, but revenues more than doubled. Checking those stocks: PMC-Sierra jumped more than 15 1/2. Bank One slipped nearly 1 1/4. And Healtheon WebMD sank more than 6 1/2.</s>VARNEY: In tonight's "Tech Watch," the crowds came out in force for the next generation of videogame entertainment. And anticipation that Sony will score very big with its PlayStation 2 has sent a host of high-tech stocks soaring. Steve Young reports.</s>STEVE YOUNG, CNN CORRESPONDENT (voice-over): Japanese consumers lined up hundreds deep in Tokyo's Akihabara, or "Electric City," two days before the hottest videogame console in the history of the industry was set to go on sale. Some analysts expect Sony to sell two million of them in the very first week. They're expected to be on sale in the United States next fall.</s>WES NIHEI, "GAMEPRO" MAGAZINE: PlayStation 2 is one of the no- brainer products of the century. I think Sony has a built-in audience. It's the perfect time in the development of console video game systems and the acceptance of video games in the game-playing public for Sony to come up with the next generation machines.</s>YOUNG: For about $350, they deliver photo realistic games because PlayStation 2 packs the power of a 1980s supercomputer. And the price includes a DVD drive and much of the wiring that will eventually enable consumers to get on the Internet.</s>CHRISTIAN SVENSSON, CEO & EDITORIAL DIR., MCV: It can also be your Internet hub for the house. You know, this is a couple of years down the line, but eventually there will be some box that is the center of all of those functions, and Sony wants PlayStation to be that box.</s>YOUNG: The current PlayStation now generates about 20 percent of Sony's revenue, and because it's a high margin product, about 33 percent of Sony's operating revenues. Right now, Sony has about 70 percent of the game-console world market, trailed by Sega, Nintendo, and soon Microsoft. (on camera): At a game developers' conference next week, Bill Gates is finally expected to tip his company's hand about what's been dubbed Microsoft's X/Box Console. A Microsoft operating system already powers the next generation console from Sony's competitor Sega in the videogame shootout. Steve Young, CNN Financial News, New York.</s>VARNEY: Not that much movement in Sony stock today, but shares that trade in New York have indeed surged nearly 300 percent since Sony hit its 52-week low.</s>BAY: Don't forget, for more on tech stocks and the tech sector, log on to cnnfn.com. And coming up, the Republican front-runner weighs in on the Microsoft case. We will tell you what George W. Bush is saying, after the break.