Sega: Sony likely needs to slash PS3 price

A man plays a PlayStation 3 video game at an electronics shop in Tokyo April 13, 2007. An executive of Sega Sammy Holdings' game unit said Sony Corp. will likely need to substantially cut the price of its game console PlayStation 3 by the end of the year to stimulate low demand.

TOKYO (Reuters) - An executive of Sega Sammy Holdings' (6460.T) game unit said Sony Corp. (6758.T) will likely need to substantially cut the price of its game console PlayStation 3 by the end of the year to stimulate low demand.

Nintendo Co. Ltd.'s 7974.OS Wii outsold the PS3 by a ratio of over six to one in June in Japan, according to game magazine publisher Enterbrain, solidifying its leading position.

"Name brand, price and software are what count," Sega Corp. corporate director Masanao Maeda told Reuters in an interview on Monday. Sega Corp. is the game unit of Sega Sammy.

"Since it's getting difficult to make software availability a differentiating factor, superior marketing and pricing strategy will be the key for Sony," Maeda said.

Game software publishers are increasingly offering new titles for multiple consoles to maximize sales and to recoup hefty development costs in a timely manner.

Sony, which has dominated the $30 billion global game industry over the past decade with its PlayStation and PlayStation 2, saw a slow start for the PS3 due mainly to its high prices and lack of attractive software titles.

The Wii, on the other hand, has constantly won more customers than the rival PS3 since its launch late last year by offering innovative ways of playing console games.

The device features a motion-sensitive controller that allows users to direct on-screen play by swinging it like a baseball bat or wielding it like a sword, opening a new avenue of game playing.

The Wii sells for 25,000 yen ($203) in Japan, half the price of the basic model of the PS3 that comes with a 20-gigabyte hard disk drive.

Maeda also said he expects an upcoming "Mario & Sonic at the Olympic Games" title, co-developed by Sega and Nintendo, to sell several million units, rivaling such big name titles as Microsoft Corp.'s (MSFT.O) "Halo 3".

"Mario & Sonic", in which Nintendo's Mario and Sega's iconic Sonic The Hedgehog will compete in events based on the official venues of the Beijing 2008 Olympic Games, will be launched in the United States and Europe around the second week of November.

"This will be the first time ever that we see Sonic and Mario appear together in a game. It surely has potential to be the No.1 title," he said.

The software, designed for the Wii console and Nintendo's DS handheld gear, will be sold by Sega in the United States and Europe and by Nintendo in Japan.

($1=123.07 Yen)