Analysts cast doubt on PSP's potential success

Industry analysts have been casting doubt over the potential success of Sony's PSP handheld, dismissing the ambition of creating a 'Walkman for the 21st Century' as mere marketing rhetoric. "I don't think Sony has hard data to back up their sales target of three million units," said Takashi Oka, game industry analyst at UFJ Tsubasa Securities. The main problem seems to be the uncertain price point, which makes it difficult for developers to fathom the tastes and preferences of the market. Without enough active support from developers, the PSP would lack the prerequisite catalogue of titles to make a suitable impact at launch.

Some observers are sceptical as to whether or not Sony's latest product will have the necessary appeal to either extend the handheld market into older age groups, or to usurp Nintendo from its position at the top of the sector as it stands. The GBA already has an established and loyal fan base, and Nintendo's DS revelations have also been causing quite a stir. On top of that, concerns have been raised about Sony's ability to deliver the product for its pre-Christmas target, and these worries will only be exasperated by the projected shortfall in LCD production.

Retailers, however, have showed more confidence, citing Sony's previous successes in marketing its PlayStation products to a fresh audience. They also suggest that gadgetry has an inherently contagious appeal: the initial customers will be expected to flash their wares at their friends and colleagues at every available opportunity, which in turn could stimulate a faddish buying frenzy in the weeks that that follow the first release.

Providing that Sony can keep the PSP price point at a low enough level and in good time for Christmas (outside of Europe), a relative success is probable. However, as far as analysts are concerned, there is little scope for the new machine to significantly affect Sony's overall profitability.