Source: http://technology.timesonline.co.uk/tol/news/tech_and_web/article6808050.ece

he Times was the only UK publication at Gamescom in Cologne last week to speak with Sony Computer Entertainment boss Kazuo “Kaz” Hirai. We met up with him the morning after he had taken the stage to announce the new PlayStation 3 Slim, and half an hour before he was due to fly back to Tokyo.

Portions of this interview have appeared in other stories from Gamescom (see below left), but we thought he had so many interesting things to say that our chat deserved reproducing in full. So here it is. Our questions are in bold, with his answers beneath.

The obvious question is, why a new PlayStation 3 now?
Well, it's closing in on our third anniversary in November in America and Japan, and we felt it was the right time to kind of pass on the benefits of the fact that we've been able to reduce the number of components and their sizes.

And we wanted to pass the cost savings on to our consumers, in the new price point as well. We also felt it was the right time in terms of the great line-up of software titles we have coming out. We wanted to make sure we had a great line-up of software, a new form factor and a new pricing point as well.

Is the new machine really an admission that sales of the existing PS3 have been disappointing?
If you look at the growth of the installed base, it is slower than the PS2 was but it's pretty much on track with the growth that we had with the original PlayStation.

We also always look at our business as being a 10-year lifecycle for all of our platforms. It's kind of difficult to say whether a platform has been successful or not going into our third anniversary. The fifth anniversary and beyond is when we really start to say how's our trajectory looking?

In retrospect, do you wish you had packed less into the PS3?
Had we done less, I think we'd have gotten into a situation where, especially with the way technology ramps up, it would have been very difficult for us to embark on a 10-year life cycle with this particular console.

I think that because of all the things we were able to pack into the platform - Blu-ray's a great example - we were able to make sure we could take advantage of some of the great services we are offering.

Those things aren't possible if we didn't put that kind of power into the platform.

A marketing person once told me that the most difficult thing to sell is a Swiss Army penknife, because it does everything. Do you think you made the same mistake with the PS3?
Right. That was more of a marketing issue than anything else. When I came back to Japan in November 2006, one of the first things I did was to go out with a very clear message that said the PS3 is first and foremost a video game console, before we talk about any of the other great things it can do. I think the PS3 had a bit of an identity problem.

We focused therefore in the first year and a half or so on talking about the great games and also we sent that message to all of our development partners.

I think we've done a pretty good job of doing that, which is why we've got this great raft of software coming into this holiday season. Once we've done that, then we can talk about all the other things that it can do in terms of the non-game video content, whether it's the video delivery service or the catchup TV service or the movie rental service. But none of that makes much sense unless we can say first and foremost it's a great video game console.

It’s well known that Sony loses money on every PS3 it sells. Will that still be the case with the new machine?
If you're just talking about the hardware alone, the quick answer is yes. That makes good headlines, but I don't actually know that that's the true nature of the business that we're all in, whether it's PlayStation, Xbox or the Wii. I think the better indicator is to look at the business as a whole platform, to ask: are you profitable in terms of the hardware, software and peripherals. And the answer t o that question is yes on a gross profit level since the last fiscal year.

Click the link for the whole interview

http://technology.timesonline.co.uk/tol/news/tech_and_web/article6808050.ece

Kaz is really great. Him and tretton are a baller team.

I'm slightly confused. Does he know or not? So still losing on hardware but profiting on software. Well the manufacturing cost will drop by the end of the year. Exactly how much it cost to make would be nice to know.

The full interview is a good read, go read!

^ agreed

PS3 on track with PS1 sales. Yeah right. So the PS3 will end up selling over 100 million systems? It is very hard to see that happening.

PS1 and PS2 were highly successful both sold over 100 million systems due to Playstation consoles having most of the third party exclusives and limited/weak competition. Now things are so much different this generation with healthy competition in the video games industry (Nintendo and Microsoft). Sony have gone from first of the previous two generations to third place this generation with the PS3.

Sony PR spin is what the article is all about.

What do you expect them to say? "We are domed"?

Those are just Japan sales- VGC has no numbers outside of Japan pre-PS2. It's worth noting how well even the PS1 was selling in Japan.

OT: That's a great read, and it's good to know Kaz Hirai has some sense.

I love Kaz, he gives me butterflies

Good read