Sony’s PS3 Delay Sends Ripples Not Waves

No one should even begin to think about writing an obit for the preeminence of Sony Electronics, but the delay of the launch of PlayStation 3 is a shock to the consumer electronics business. And it’s a tacit admission that the industry leader has got a case of the high-tech jitters.

As the L.A Times points out in a report today: The delay is not just a downer for gamers it’s really thrown a wrench in the release of the next generation of DVD with its competing and incompatible formats.

According to the story, PlayStation is the company’s most profitable product line and one of the most popular tech devices of the last decade, outselling Apple Computer Inc.’s iconic iPod 5 to 1. In addition to staying ahead of the curve in the $25-billion global games market, PS3 will include Sony’s high-definition DVD format called Blu-ray. The competition between Blu-ray and the rival standard HD-DVD recalls the format wars between Betamax and VHS in the 1980s.

The delay leaves the market wide open for Microsoft’s wildly popular Xbox 360. And the DVD format battlefield will be HD-DVDs all alone for the all-important early adopter phase that’s often critical to the success of any new technology. Will the geeks wait?

Not to worry, says one analyst. “I don’t think the delay will impact their ability to capture market share with the next generation,” says game industry analyst Anita Frazier of NPD Group. “The brand is very strong and Sony was always clear that they would release the system when it was ready and not before.”