Sony executive heralds a revolution in virtual reality

Last updated: November 30, 2014 7:47 pm

Sony executive heralds a revolution in virtual reality

By Tim Bradshaw – San Francisco

A booth attendant demonstrates the Sony Project Morpheus virtual reality headset for a photograph at the Tokyo Game Show 2014 in Chiba, Japan, on September 18 2014
©Bloomberg

Virtual reality will revolutionise the gaming market in just two years, according to the head of Sony’s PlayStation business in the Americas, as the Japanese electronics group readies its Project Morpheus headset to rival Facebook’s Oculus Rift.

In an interview ahead of an event this week to mark the 20th anniversary of the PlayStation’s launch, Shawn Layden, chief executive of Sony Computer Entertainment America, said: “In a couple of years from now, we are going to see virtual reality changing the entire gaming experience.”

The comments come as Sony scales back its ambitions in the smartphone market and pins much of its turnround effort on its video games business.

Virtual reality could give Sony a new line of revenue in both devices and content, but the technology remains unproven in the consumer market, increasing the company’s risk at a critical moment for the struggling Japanese group.

After many years of false starts for the technology, some of the world’s biggest tech companies are now investing huge sums in virtual reality.

Google led a $542m funding round for a VR start-up called Magic Leap in September.

Facebook acquired Oculus in March for $2bn and has been investing hundreds of millions of dollars to develop a consumer version of its Rift headset, expected next year.

Oculus is also partnering with Samsung on a mobile-phone based headset, Gear VR, which is going on sale to developers this month for $199.

In March, Sony unveiled its Project Morpheus prototype headset, which it said would work with the PlayStation 4, but it has not specified a price or release date for the device.

Mr Layden said Sony would bring its VR device to market “not only when we have the technology and the production costs and the hardware issues completely worked out but also when we have the right experience”, in terms of games and content.

As well as trying to solve technical problems around input devices and displays that do not cause nausea among users, Sony – like other VR investors – is still looking for a “killer app” for the device.

“It’s not just confined to gaming,” Mr Layden suggested. Sony has been approached by more than 100 non-gaming companies about creating new content and experiences for virtual reality, from travel and education to watching live sports via the immersive headsets.

But he added: “We have to concentrate on delivering this VR experience in a meaningful and attractive way in the gaming world first. Without success in that realm, it would be difficult to start to branch off.”

The PlayStation is central to Sony’s turnround plan, with executives in Japan telling investors last week that it expected to increase revenues from Y1.3tn ($11bn) this year to Y1.4tn-Y1.6tn in three years.

Since its launch a year ago, the PlayStation 4 has consistently outsold its rivals, including Microsoft’s Xbox One and Nintendo’s Wii U. In the holiday shopping season, PS4 consoles were in “full supply”, Mr Layden said, after product shortages held back sales last Christmas.

PlayStation will receive a promotional boost from a two-day event in Las Vegas this weekend marking 20 years since Sony’s games console first went on sale.

This month will also see Sony begin small-scale testing of its new cloud-based television service, PlayStation Vue, which will eventually work with 35m PS3 and PS4 consoles in the US. Sony has signed up American content partners including CBS, Fox, NBCUniversal and Viacom but is still in talks with holdouts including Time Warner and Walt Disney.

Mr Layden said that convincing traditional media companies to participate in what he described as a radical departure from previous internet TV efforts was a “long road”.

“There is no one of meaning that we are not talking to. Those conversations continue apace,” he said. “We know the cornerstone for live TV is news and sports, so we have to have the full complement of those channels.”

PlayStation Vue promises a personalised content selection and a new interface unlike any current US cable TV service. “No one has done what we are trying to do,” Mr Layden said.

Copyright The Financial Times Limited 2014.



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