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History of Gaming Industries

Gaming industry basically formed in 1970’s and become a billion dollar industry
throughout the world. In this particular assignment I am going to discuss about a brief
history of gaming industry. Gaming industry is highly competitive and innovative
industry. Day by day people want more game with new technology. Once there was
time people use to play limited video games by using television, and only couple of
games were available in the market. But now there are so many different types of
games available in the market with new and most innovative technology. Play station
1, 2, 3, Xbox, PSP, Nintendo, Wii are the few example of these games. Sony,
Microsoft, Sega and Nintendo they are the key players in the gaming market.

It’s a $27.5 billion industry, but the modern gaming industry had a humble beginning.
First commercially successful in United States was Atari game console which was the
Atari Video Computer System. Atari was very popular and by 1983 became the
market leader. Soon companies like Midway, an old-line maker of equipment for
amusement parks, started getting into the game. The coin-op company that brought
Space Invaders to America had invaded the space of Atari then the industry leader in a
big way.

After a year when U.S. market collapsed, Japan had started a global epidemic. Two
Japanese companies Sega and Nintendo were busy to develop a new generation of
machine using of 8bit processors. They introduced their first home gaming console in
1983 and it was a great success. After that more companies attract this business. So
different companies were used different technology to get the market. Sega and Mega
drive become so popular in United States, Europe. Japanese companies were enjoying
an increasingly firm grip on the global video games market. Lead by Sega and
Nintendo, the games industry reached its cyclical zenith around 1992/3 with
combined sales over 55 million hardware units.
In 1994 fourth generation machines began to use, example would be 32bit processors.
Also Sony enters to this business with new technology and for Sony’s PS2 they get
the 60% market shares of fifth generation machines. After that sixth generation
gaming device with high definition technology came, Microsoft first lunch of Xbox
360 in 2005. The main fact was at that time kids were not the target market but it
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targeted towards more matures audiences and developing games very quickly. On the
other hand Sony gave the answer to Microsoft by lunching PS3. PS3 is expensive but
very good quality and have some great advantages. Highly created consol and endless
games makes PS3 very strong in the market.
Gaming industry is highly innovative and quick. Nobody wants to waste time. All the
company busy to create new game and developing new technology. Wii is the perfect
example for new technology. It basically operated by human body motion. Become
very popular to the all age groups. Microsoft also introduced Kinect which is also
body motion operated games. Technology becomes more sophisticated and reliable
that we can now play games in our mobile phones. Sony Ericson made a phone with
play station game console with it. We can now also play games online. By using
internet we can play live. There is online archive for Xbox and PS3 so any one can go
there and pay and get the chance to play. Mobile device also used as game console.
People can buy game online and share with friend all over the world. Microsoft Xbox
360 and Sony’s PS3 is no more only game console but also became multimedia
device. We can operate movies, videos and recorded videos as well as we can use
internet with this devices.

Today, the video game industry is a juggernaut of development; profit still drives
technological advancement which is then used by other industry sectors. Though
maturing, the video game industry is still very volatile, with third-party video game
developers quickly cropping up, and just as quickly, going out of business. This is the
reason between this industry we can found so much competition and innovation.
Apple is also using touch screen mobile and portable device for gaming, which means
day by day this industry growing and become more and more competitive.
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Position Audit for Sony Computer Entertainment Inc

Position Audit is a systematic assessment of the current strengths and weaknesses of

an organization as a prerequisite for future strategic planning and implementation.
We are going to do position audit for Sony Computer Entertainment Inc, which is a
massive multinational company known by the people all most all over the world.
When we discuss about position audit what first thing we have to do is internal
environment discussion. So for this purpose we are going to do SWOT analysis but
before doing it we have to know the current position of the company and external
facts which normally can harmful for business. So for discussing external
environment we will conduct a PESTLE analysis.

PESTLE stands for political, economical, social, technological, legal and

environmental. Before discussion we have to know little bit about Sony and their
business. Sony is massive multinational company, very well known and has very good
reputation. They manufacture electronic products, which including television,
computers, games, camera, tablet and so many other staffs. In this particular
assignment we discussed about Playstation which is invented for giving answer to
Microsoft for their Xbox 360.

Political issues are really vital for Sony Corporation because political factor can
change the company for ever. The Government holds the power to change any
policies and regulations which may affect Sony at the time. The laws which can affect
Sony Corporation would consist of new international policies. Internationally the
Government may change or increase trading restrictions which would definitely
change the way Sony works, because it needs to trade. The Government also has the
power to change minimum wage, tax, VAT etc. These factors must be concentrated on
so that Sony is prepared for any major global changes.
Economically, due to this many changes can occur such as the interest and exchanges
rates. Because of recession the power of buyer’s get lower and lower, exchange rate
also become less and less, it’s really bad for such a company like Sony. They want to
increase their sell worldwide which can be very difficult for this present economic
down turn.
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Socially Sony can do better because they already gain reputation by their quality
products. People are respectful about their product. So it can change needs factor for
society. We will find so many persons who basically always buy Sony products. Sony
Corporation actually made that position by their innovative ideas and creativity.
Technology is the heart of this company. As we know that any gaming and electronic
manufacturer has to be innovative and have to have most advanced technology. Sony
has their latest technology to invent new products. Also they change and upgrade their
technology very often with the development of newer technologies.
Legal factors are mainly different rules introduced by different countries all over the
world. Changing of employment law, corporation tax etc will affect this company.
And finally environmental factor’s which mainly discussed by their corporate social
responsibility. They create jobs for different cities. Also people buy their staff and get
good service which is also good for their existence.

Now I am going to discuss about the internal environment of Sony Entertainment

which is SWOT analysis. SWOT basically Strength, Weakness, Threats and
Opportunities. First of all Sony as a very successful and reputable business
organization they have strength to go forward and stay in this market. Their strength is
they are able to create high quality product for their customers. They have different
segment example would be Sony Computers, Sony television, Sony mobile phone,
Sony tablet etc. They charge normally higher than average price but they provide
good product with reliable services. Also if we discuss about 6M’s we will find out
they have enough manpower to run the business all over the world. They got large
amount of money which they can invest. Their machineries are latest and advanced
also they use most effective and latest material to manufacture computer and other
products. They have great market reputation which allows them to reach new markets.
Corporate Governance and culture of this company makes them look with good make-
up.
On the other hand they have few weaknesses which they have to overcome. Last
couple of years they make losses. Recession has decrease sells and have increase cost.
People are looking for cheap staff but Sony maintains a certain quality and for this
purpose it is almost impossible to decrease significant price.
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We could found few future threats for Sony’s market shares. Their competitor’s are
the real threats. Example would be Microsoft. Also there are so many fake
organisations who using Sony’s logo and get bad response from the community. They
also have different types of market which some times prevent them to enter new
market. Microsoft as a one of the biggest company in the world is Sony’s main
competitor. They also innovative and use unlimited resources to get the highest
achievements. As many as bigger company enters into the market their share value
going to decrease. So if they want to cope with their situation they have change their
strategy very quickly with the change of a customers needs.

Compare and Contrast Sony’s strategy implementation with another

player in this market

Sony has successfully created an incredible brand name and PlayStation is one of
their most advanced gaming consoles. Another big player in the gaming market is
Microsoft with their Xbox. Now I am going to discuss and compare strategies
implemented by Sony with Microsoft to try to gain market dominance. First of all it is
quite possible to turn strategies and plans into individual actions, necessary to produce
a great business performance. But it's not easy. Many companies repeatedly fail to
truly motivate their people to work with enthusiasm, all together, towards the
corporate aims. Most companies and organizations know their businesses, and the
strategies required for success.

The gaming industry had always been fraught with competitive battles and short
technology life cycles, with new generations appearing roughly every five to seven
years. This is main reason for engaging in a number of strategic actions to try to
survive. Consumers position the Sony brand in their minds as the leading innovator
and provider in digital entertainment. To encourage this positive brand position, Sony
takes on a variety of steps that can be analyzed accordingly through a Four P's
Analysis.

Product: As a business strategy, Sony markets its PlayStation line as devices that can
do anything, including the ability to play high-definition blu-ray movies, host video
chats, and play music. In the short term, this strategy is effective because of the
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limited scope of current electronics. For example, blu-ray players are still priced at a
high premium, making the PlayStation 3 a viable substitute for a blu-ray player.
However, Sony needs to remain focused on the main purpose of their gaming
products and not lose sight of the value of gaming because technology will likely
adapt in the long run to make these extra features less attractive in a gaming console.
Instead of focusing purely on gaming, Sony hopes to be the next game changer and
revolutionize the way consumers enjoy their various platforms of home entertainment.
They introduced PlayStation Move motion controller in 2010 which is used in
combination with the PlayStation Eye camera to detect the precise movement, angle
and absolute position in 3D space of user.
Price: In 2011 Sony cut PS3 by another 50$ to boost sales globally. And it works
when they actually began to make profit and PS3 finally become best selling gaming
console on Amazon.com.
Place: Sony takes advantage of convenience by distributing their products throughout
a multitude of distribution outlets including Sony retail stores, electronics distributors
such as Best Buy, one-stop shops such as Wal-Mart, as well as online retailers.
Promotion: Sony knew that customers are not only wanted to play games but they
also want many other features. And also customers want to know about their product
and Sony takes a simplistic approach to promoting its products and communicating
with its consumers through advertisements and promotions through various Medias
such as television, banners, magazines and Internet ads.
If we compare these strategic steps with Microsoft we will find out that they also
release of Xbox in late 2010 with Kinect featuring, a full body motion sensing camera
that could detect and translate user movement without handheld controller. Microsoft
knew that they are not going to catch up to PlayStation but they again release Xbox
360 for creating a more approachable experience. Microsoft has great advantages
because it is already known to the people through computer and software
manufacturer and that’s why their promotion and placing of Xbox 360 become easier
and effective.

Sony also takes few other strategic steps by partnered with the Guinness Book of
World Records to verify the longest running video game ever. Also the number of
PlayStation Move supported software titles has reached 155. Sony Ericsson released
the Xperia PLAY, a smart phone that was PS-game compatible. This is one of the best
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approaches taken by Sony. Gamers have the chance to have gaming phone and they
just loved it which makes so much profit for Sony over the year. On the other hand
Microsoft also uses different strategy to achieve their goals. They introduce high
definition technologies for the first time. Consumers can download game and stored
files in the hard disk. They invested lot to develop new games. Also they give a great
opportunity to their customers by giving online gaming access through its live
platforms.
Finally in terms of information technology currently, Sony has an important global IT
and Internet presence, which makes it relatively easy for the company to get its
products and services to most places in the world.

Seventh Generation
In the history of video games, the seventh generation of consoles is the current
generation as of 2012, and includes consoles released since late 2005 by Nintendo,
Microsoft, and Sony. This is now not only games but also have different features.
Example would be Xbox 360 has Xbox live feature which allow gamer to play with
the people all over the world. High speed internet can use by gamin console. It also
works as a DVD player. Price is decrease dramatically. Everyone involve in this
particular business busy with create new games and developed console. Seventh
generation is the time of advanced technology. Apple is also joining with Sony and
Microsoft in the competition by put gaming system to the iPod and iPad. So they are
now become direct competitor of Sony.

If Sony or Microsoft and other company want to remain in the market they have to do
few things which are as follows:

 Have to use new improve technology for making Gaming Console or any
other products
 Decrease price
 More and more new games
 Extra features
 Quick diversification
 Excellent marketing
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On the other side few player’s will repositioning them to cope with the competitive
market. More and more new facilities will make gaming console successful example
would be Xbox with live platform, also with internet connectivity and ability to
download, store and play back content. Netflix or Hulu subscriptions via PS3 already
possible for users to access and watch movies, Xbox now also have that technology to
support these features. Seventh generation is the time for changing gaming device. All
the competitor in this market working on it desperately and try to invent something
new and effective. Wii is one of them, now a day people can even do exercise by
using wii which is really a great idea. Also Nintendo DS can use for brain storming.

Finally Seventh Generation gaming industry is very competitive and place of most
advanced technology. All the players need to invest on research a lot to invent
something new beyond our imagination. By doing such an action can give the
opportunity to remain in this gaming market with a strong position.

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