Sony’s Move as Microsoft Pushes into TV

Now, observers of the gaming space are left wondering, what’s Sony’s next move? Most are uncertain just how closely PlayStation wants to align itself with the media and advertising business, and whether the PS3 is even aiming to become the central hub of the digital living room.

“I think what Microsoft did was brilliant,” said Brandon Berger, chief digital officer at Ogilvy & Mather. Berger believes that Microsoft is eyeing a future where fewer video games are sold in stores, but rather through digital downloads. Thus, more boxes in the home translates to more opportunities to have a direct-sales relationship with gamers.

But it is Xbox’s advance on the digital living room where the biggest potential lies. “The Xbox has a chance to be that one box that is always on in the home,” said Berger. “Sony now has to make a decision. They have made some good moves, but they have to make a decision about where they are headed.”

Many gaming experts aren’t quite sure about Sony’s grander intentions when it comes to media and advertising. The company declined to comment for this story.

The PS3 is undoubtedly a device that offers more than gaming. Most consoles are shipped with a Blue-ray DVD player, and Web-connected users can access both Netflix and Hulu Plus. PS3 gamers can also stream content via Wal-Mart’s Vudu. Sony has experimented with original PS3 series.

But some content companies believe that Sony’s focus on PlayStation Home, its PlayStation-centered virtual world, which has recently pivoted toward becoming more of a social network, has cost the company in the media space. Several media companies, speaking on the condition of anonymity, say they’ve approached Sony in the past about building content distribution deals, only to be rebuffed — with Sony trying to shift their interest to the Home platform.

Meanwhile, Microsoft may have snuck up on Sony.

“Microsoft was almost stealthy about these content deals,” said Peer Schneider, svp of content publishing at IGN Entertainment. “Sony has had this ‘it does everything’ campaign, but it’s never expanded to serve as a central hub in the home. Sony seems to have taken its eye off linear entertainment.”

At least in the U.S. it has. But in Europe, PS3 users can stream networks such as the BBC, perhaps providing a clue as to where Sony might be headed.

Yet not everyone is so sure. Matt Story, director of Publicis’ Denuo Group, believes that Sony is less interested in owning the digital living room and is more interested in nailing gaming. “I don’t think they see people settling on one device, so media is a secondary strategy right now for them,” said Story. “It’s a question of strategy. With media, they would almost have to start from scratch. They see the PS3 as primarily a gaming device.”

And, therefore, it’s less of an advertising device. Right now, there is probably an even bigger gap between Xbox and PlayStation when it comes to advertising than there is with media distribution. Story and others said that when the two gaming companies are pitted against each other, Microsoft stands out because of Xbox Live — which is considered exceedingly ad friendly.

“The Sony interface probably needs a refresh,” said Berger. “It’s not as well designed for content and ads, which is why they probably haven’t gotten as much of a push.”