A Strategy for the Game

Q: Can you comment on the
demand and supply for the
PlayStation console in the
country? Which type of console
is selling well?
A: PlayStation 2 and PlayStation
Portable (PSP) are fast selling
products for us here. In fact we
were caught by surprise when we
launched PlayStation in India. We
expected people to pick up the PS2
first and then the next generation
model (PS3). But PSP is also flying
off shelves. PS3 is well known in
the market, but we’ve had
difficulty pushing sales in the
official channel. The total market
for PS3 is 15,000 units. I sell
6,000 units through the official
channel and 9,000 units in the
grey market. Unlike the other two
consoles (PS2 and PSP) for which
we have subsidized the cost, it’s
very difficult to cut the 35 percent
import duty and 12.5 percent VAT
on a high-end product (PS3). That’s
why we have difficulty with PS3
sales. However, the other two
consoles have surpassed our
expectations. We sell 8,000 PS2
consoles and around 5,000 PSPs
monthly. The current installed base
of PS2 in India is around 3,25,000
units. There are between 60,000 to
65,000 PSP units here. PS3
numbers will be between 12,000 –
15,000. We’re really pleased with
these numbers.
Q: What factors can you
attribute to these encouraging
numbers?
A: Two things worked for us. The
PR and media coverage helped and
there is now almost a cult for this
gaming platform. The other thing
that helped was our decision to
match the grey market price and
expand the official channel. From
around 150 shops that used to sell
PS, we today have over 1,000 retail
points for PS products. The pricing
for PS2 is Rs 6,990; PSP sells for
Rs 7,990 and PS3 is priced at Rs
24,990. So the price differential
between grey market and official
channel for PSP and PS2 is almost
negligible. If someone claims to
have got their PS units at a much
lower price (in the Indian market),
there is a possibility that the unit
has been hacked. In some cases,
grey market vendors are replacing
the original controller with an
inferior one. Hence they are able
to reduce the price.
The other important decision that
worked well was to replicate the
games locally and sell each at a
price point of Rs 500.
So the running cost has decreased
and a wider range of games is
available. Couple this with the low,
subsidized cost of the console.
Q: What kind of localization are
you doing for games?
A: The Singstar and Buzz games
(Ed: both are reviewed in the
Unwind section) are experiments to
bring in local content. We are
working with leading India game
developers like Trine Game Studios,
FX Labs and Aurona (Pyramid
Saimira Group). We are also in
discussion with others.
We will work with them in easing
the process of getting into full
cycle game development and
content on the PS platform. We
will have a developer conference in
India very soon. So there will soon
be a lot of initiatives for creating
games with Indian themes. We
hope to have one new Indian game
every month for the PS2. After a
year or two there will be games
with Indian characters that appeal
to international audiences.
How will the localized games differ
from the ones that you sell in
other markets? Where will you
compromise to keep the price low?
Our forthcoming low-priced India
theme games will not be trashy.
These will have high quality
graphics and good gameplay. The
number of levels in the games will
be reduced to make the game
available at the right price.
Q: What are your initiatives to
tackle piracy for PS2 games?
A: We are seeing a lot of piracy for
PS2 games. It’s not so easy to
pirate PSP games, but it has
started happening. But we counter
that by providing many of the
games on our online PlayStation
store (Store.PlayStation.com). So
one can download a game on the
PC and put it on a Memory Stick
(for the PSP).
We are also working with the
Indian Music Industry (IMI) group,
who are spearheading our anti-
piracy efforts. We work with the
judiciary and policy makers to find
ways to tackle this problem.
On the business side, we will offer
the games at a very low price of Rs
500 (for PlayStation 2). These
games used to cost Rs 1,600. The
pirated game costs Rs 125. Now
people don’t mind the small
difference and are ready to pay for
the original game.
We are also looking at other areas
like chip modification (hacked
systems).
Q: We see that you are
displaying the consoles at
entertainment spots like pubs
and restaurants. What about
experience zones in retail?
A: We have also done so in retail.
We realize that gaming is all about
the experience. We are doing it
(experience zones) with retailers
who are interested. Croma and
Reliance Digital have experience
zones. Even traditional retailers like
Vijay Sales, Sumaria and Sony
Mony have realized that experience
zones are important. They know
that creating consumer excitement
is an issue.
One of our retailers held a racing
competition. We also carry out
promotional activities at the Sony
Worlds. The Singstar activity occurs
at many malls. It has then moved
into the modern retailers
(showrooms). Now it is going into
the BPOs and nightclubs. We also
want to set up these experience
zones in army canteens. We want
to go wherever the consumer is
present.
Q: How does hacking degrade
the performance of the
machine?
A: The Sony warranty become void
when you tamper with the
machine. You won’t be eligible for
Sony service. While you can play
the pirated game on the hacked
console, there will be a
performance issue over a period of
time. The system will have a
tendency to crash or freeze.
Any plans for launching the
PlayStation Network and the
PlayStation Store (online) in India?
PlayStation Network and the
PlayStation store are key online
initiatives for the platform. In fact
we are ready with the store. It is
just a matter of timing. We are
delaying the launch of the store
because India is not yet broadband
ready—downloads take time. And
Indians do not blame the ISP. They
blame the site. We do not want to
create a dissonance. A full PS3
game is a 20 GB download. It will
take the entire day to download it
with the current bandwidth.
We will also launch Home for
India, another online concept. We
will have a PC download site so
that one can download the games
on the PC and then put them on
Memory Stick (for PSP). Expect all
this during the current financial
year.
Q: What about PS3 starter
packs?
A: There will be starter kits in
India. There will be a lot of game
bundling. We will also work with
Sony Pictures to introduce DVD
bundling. But we need to figure
out the right price points.
Q: How frequently will you
launch new game titles in the
Indian market? How many titles
have you launched so far? Can
you tell us about forthcoming
titles? What about parallel
launches?
A: All the international PS3 games
are launched in India and we
always try catching the Day 1
launch of all the SCEE (Sony
Computer Entertainment Europe)
published games.
We also work closely with the
other big publishers to ensure the
key titles are made available in
time for the Indian market through
their distributors.
The games come in either through
Sony or through other publishers
like EA. You also have publishers
like Activision, THQ, Konami and
others. Barring one or two
publishers, most of the titles are
available in India. It is a parallel
launch. Both God of War and GT 5
are happening in parallel across
the PAL territories (Europe, Middle
east, India, Australia, New Zealand)
.