Sony's "Ace in the hole"...

[Erik Aston]

Sony certainly has a lot of content (games, movies AND music) they can leverage, but I think a key question is how much are they asking consumers to change their behavior? If you look at something like Apple TV, they will be asking people to hook this box up to their television, which will stream their media straight from their computer. For those with an iPod, this is a great proposition. And iPod + Apple TV gives you complete interoperability from your home computer to work computer to television to portable device, while allowing you to manage all your media from your PC. The PS3 setup seems to be asking you to manage your media from your TV, and then gives you less flexability between devices. iPod + Apple TV relies on consumers to use their PCs as their media hubs (which I think is the established behavior at least in the US), while PS3 is trying to replace your PC. Now, the PS3 is such a versatile device that Sony have flexability in establishing a working business model. But I don't know what thats going to be. Of course that brings me to the other point discussed in this thread: Apple entering the VG business. Apple obviously wants to dominate the realm of digital media. But, I think they've still got an uphill battle. With Apple TV, though I think its in a better position than PS3, they've still got a problem. iPod is great because portability is such a big factor with music, and because it didn't ask you to stop buying CDs. The vast bulk of music sold is still in CD form, because that offers the most flexability--ripping to iTunes, but still playing the CD from your home stereo system. With video, most people only care about playing it from their computers or their televisions, which they can already do with their DVDs. So Apple TV doesn't seem to offer all the advantages iPod did. When they move to videogames, the problems compound. PCs are out of the loop, and handheld and home console gaming are entirely different spheres, which have recently been shooting in different directions control-wise, thanks to Nintendo. There's a lot of way they could do it, but Apple could not break into the games sphere in a traditional way, and maintain any of the great advantages they've had with iPod. I think the games market is something they're eyeing though, and we'll see developments throughout this current generation. Nintendo merging with Apple would be totally out-of-character for both companies.