As Brier Dudley from the Seattle Times points out in his latest article,
A lot of people who bought fancy TVs over the past year or two have been looking for ways to get more digital content on their screens. They’ve been waiting for high-def player prices to fall, and for a resolution to the format war between the Sony-backed Blu-ray and the Microsoft-backed HD-DVD.
I have been thinking about this a lot lately. My repsonse: You bet they do, but not just from Blu-ray or HD-DVD discs, more and more they want to get content online. Blu-ray is great and I enjoy watching HD movies on my PS3. But more and more, I would really like to be able to access online content.
That’s where Sony is releasing an add-on TV tuner that turns the PS3 into a TiVo-like video recorder. It’s also where Sony is talking up plans for an online video and music store, similar to the ones operated here by Microsoft and Amazon.
Cool, I can watch and record TV and even download videos and music directly from Sony. Sounds great, doesn’t it? What about my iTunes library, YouTube, Flickr and all the other content available online? Will I be able listen/view that content? What about online content like Hulu? Will Sony make all that available and stream it to my PS3? Well, it’s too early to say for sure, to my knowledge Sony hasn’t been specific about online content for its PS3 platform, but based on the past behavior let’s say–I doubt it.
Dudley asks the pivotal question,
Will we keep using PCs to download and store this stuff, or will some computerish consumer-electronics gadget emerge as the new home-entertainment hub?
With game consoles in over 40% of US households and with most of the consoles in broadband connected households, the PS3, XBox 360 and Nintendo Wii, could play a pivotal roles as an entertainment hubs. The problem is each of these companies has a vested interest in building an ecosystem around their platform and only their platform. Call it an “insular ecosystem”. So when Sony builds their online content service, it will serve PS3s and only PS3s. Microsoft will counter with an expanded 360 content platform serving only 360s. And lest one forget, the PS3 (and the 360) as game platforms first and foremost. While both Sony and Microsoft have become more comfortable with the “give away the razor, sell the blades” economics of game consoles (I am sure they would both vehemently state their hardware businesses are profitable–sure they are, because they can dump much of the costs into another category on the P&L), content and services will be rolled almost exclusively as a platform differentiator. In other words, they will view online content and services as a marketing expense to sell more hardware to sell more games.
As long as Sony, Microsoft and Nintendo create insular ecosystems, the game console as a digital hub will never take off.
For now, it is great to see the online connectivity options enhanced on the PS3. I am certain there will be more to this story.