By Franklin Paul and Lisa Baertlein
NEW YORK/LOS ANGELES (Reuters) - Sony Corp. risks losing its iron grip on the video game console market with its new PlayStation 3 (PS3) and needs to significantly lower the price on its high-end machine to woo buyers, Ubisoft Entertainment SA's (UBIP.PA: Quote, Profile, Research, Stock Buzz) chief executive said on Wednesday.
"For sure Sony will have a different market share ... lower than before," said Yves Guillemot, chief executive of Ubisoft, Europe's second-largest game publisher, at the Reuters Global Technology, Media and Telecoms Summit in New York.
Guillemot expects the extent of the decline to be linked to pricing on the PS3. The high-end unit sells for $600 in the United States, $200 higher than the top-end Xbox 360 from Microsoft Corp. (MSFT.O: Quote, Profile, Research, Stock Buzz) and $350 above Nintendo Co. Ltd.'s (7974.OS: Quote, Profile, Research, Stock Buzz) Wii.
"They have to decrease the price quite significantly," he said, declining to elaborate. The fortunes of the machine also depend on whether Sony can sell consumers on its next-generation Blu-ray DVD technology, since the PS3 includes a Blu-ray player.
Sony's (6758.T: Quote, Profile, Research, Stock Buzz) (SNE.N: Quote, Profile, Research, Stock Buzz) 7-year-old PlayStation 2 sells for around $130 and has continued to rack up impressive sales versus its newer rivals. It was the leading console in the last generation with lifetime unit sales of 38 million in the United States.
Guillemot said Ubisoft is planning to deliver an exclusive PS3 title in Europe but declined to reveal the name.
Gamers have complained that there is no must-have game available only on the PS3. Sony has promised to deliver this year.
Ubisoft, known for its "Splinter Cell" and "Prince of Persia" games, has seen its fortunes rise on its early bet on the Wii.
Electronic Arts Inc. (ERTS.O: Quote, Profile, Research, Stock Buzz), the No. 1 game publisher in the $30 billion video game market, holds a roughly 15 percent stake in Ubisoft.
© Thomson Reuters 2009. All rights reserved.
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