PlayStation 4 Coming Soon; Console Wars; Sony's Struggle
QUEST: This was number 1. This was number 2. This -- they're getting bigger, not smaller. This is number 3. And today, Sony is unveiling the PlayStation 4 in New York. It's the latest model in the Sony iconic game console series. Now, it may be the most important launch of all, because the one that started in 1994 with this, the PlayStation 1, unlike most consoles before it, the games came on CD-ROMs, which opened like that. They had titles like "Final Fantasy" and "Metal Gear Solid," and they are regarded as classics. They're also antiques. This is number 2. It's actually quite heavy. It was bigger, heavier, and it was more of a success than the first one, 150 million of them were sold, making it the most successful game console of all time, despite the challenge from Microsoft with its Xbox, which came into the market. It's getting bigger and we are getting -- we're actually getting quite heavy now. The PlayStation 3 was supposed to be even bigger in 06. Now remember, that sold 150 million. This only sold 77 million, and there were problems with cybersecurity, particularly online playing. Hackers stole personal info because it was all stored. Well, Sony hasn't turned a profit in almost five years, and now PlayStation is up against bigger, more robust competition. It's also in competition with the SmartPhone and the tablets. In other words, the PlayStation console could be a thing of the past, which is why, as Maggie Lake reports, they have to do something dramatic with PlayStation 4.</s>MAGGIE LAKE, CNN INTERNATIONAL CORRESPONDENT (voice-over): Sony needs to get out in front early if it has any hope of regaining its lead in the gaming industry. This week, the consumer electronic giant is expected to unveil the fourth generation of its PlayStation gaming console.</s>UNIDENTIFIED MALE: And this is a crucial play on the way.</s>STEPHEN TOTILO, EDITOR-IN-CHIEF, "KOTSKU": There's a lot of pressure on Sony right now. They have to justify that it's time to move from the PlayStation 3 era to the PlayStation 4 era. They need to justify that PlayStation still matters. Because we hear about Nintendo all the time, and we hear about Xbox and Connect. With PlayStation, it's kind of faded a bit, so they need to reassert their relevance.</s>LAKE: There hasn't been a new console from Sony in seven years. During that time, Microsoft's Xbox has taken the lead in the US market, with Nintendo's Wii a competitive third. Globally, Sony is still the number one console maker, but that may also be shifting. Consumers are increasingly downloading games on their SmartPhones and tablets instead of buying consoles. For new consumers, apps are often cheaper and easier.</s>TOTILO: So, who's kicking? Are you kicking?</s>LAKE (on camera): No, I'm receiving. You're kicking. Oh, no, it looks like I'm kicking. No, wait. No, I'm receiving.</s>LAKE (voice-over): It's a competitive playing field, but don't count Sony out yet.</s>TOTILO: Sony's advantage that they have over Microsoft, if they have any advantage, is that they have amassed a bunch of exclusive game development teams all around the world. When we see what Sony unveils with their hardware, we should also be looking to see what games they show. Because just that one perfect game, like we saw Wii Sports define the Wii, could change everything for Sony.</s>LAKE: Maggie Lake, CNN, New York.</s>QUEST: However good the technology and however marvelous and whiz- bang-pop the games, Sony is fundamentally a company designed to make profits, and the company's investors haven't been shy about expressing their doubts. The stock down more than 71 percent since late 2007, just after this was released. And it's not all to do with the gaming division. Alex Zolbert is in Tokyo.</s>ALEX ZOLBERT, CNN INTERNATIONAL CORRESPONDENT (voice-over): A clear picture of how the mighty can fall. Sony was once the dominant player in the tech world, the king of all things cool. Many will remember that must- have Walkman. But what has not been music to the company's or investors' ears is Sony's staggering losses in recent years. While some of its competitors have been minting money, Sony hasn't turned a profit since 2008. In fact, the last fiscal year was the worst in the company's history, in part due to the aftermath of Japan's devastating tsunami, but also thanks to a weak product lineup.</s>ZOLBERT (on camera): This is the latest version of the Sony Discman, a product that came onto the market back in 1984. And to try to give you an idea just how far Sony shares have fallen, well before they got a boost from the weaker yen in recent months, they were trading at the same level as to when this product came on the market.</s>DAMIAN THONG, MACQUARIE SECURITIES: Most people are watching what other people will do or what other people are buying to make their purchase decisions. And Sony really needs to capture, you can say, the heart as well as the minds of consumers in many parts of the world to regain that luster.</s>ZOLBERT (voice-over): It's not all grim news for Sony, though. Sony Pictures has hit the mark with recent hits, like "Skyfall." The company's sales overseas are also now getting help from a weaker Japanese currency, and next month, when the deal is set to close, Sony should net close to $700 million from the sale of its US headquarters in New York. But either way, as gamers await the latest PlayStation, it's clear Sony needs a big hit if it hopes to return to glory anytime soon. Alex Zolbert, CNN, Tokyo.</s>QUEST: One of the sporting world's most powerful men is the chief executive of Manchester United, and he's decided to call it a day. David Gill's legacy of record sponsorship in a moment.