The PlayStation Vita Price Cut May Boost Sales, but It Highlights Sony's Recurring Problem

By Anthony Shields  FEB 19, 2013 1:30 PM

Sony is taking a page out of Nintendo's playbook, but it really needs to fix its own.

 


While the entire gaming media is eagerly anticipating a predicted announcement about a forthcoming PS4 at tomorrow’s PlayStation Meeting 2013, Sony (NYSE:SNE) has already dropped some pretty big news concerning its handheld console the PlayStation Vita. Yesterday, Sony announced that on February 28 the price of the Vita will drop to 19,980 yen in Japan from its current price of 24,980 yen. Sony has yet to confirm whether a similar price drop will occur in America, but if it does, the handheld will likely go for $200, down from its current price of $250.
 
The price cut is intentioned to boost the sales of the Vita, which have been sluggish since the Vita's launch last year. Sony is following the example of its rival company Nintendo (PINK:NTDOY), whose 3DS system performed poorly after its release, but later became one of its most profitable products after a substantial price cut.
 
Slashing the price will likely be a good move for Sony, but to be honest, few if any critics ever claimed that the system was overpriced. According to numerous sources, what really hurt the Vita’s early performance was a lack of compelling games to play in the months after its launch. The system’s advanced technology and ability to allow users to play remotely from the PS3 were great selling points, but as consumers noticed the small numbers of titles that were available for the system, and the limitation of the cross play system, interest greatly decreased. To date, the Vita still lacks a “killer app,” but its growing library and anticipated titles, like Square Enix’s (PINK:SQNXF) Final Fantasy X HD, have prevented the handheld’s sales from dropping to seriously low numbers.
 
While things may yet get better for the Vita, one must wonder if Sony’s habit of neglecting launch software for its consoles will hinder the performance of the upcoming Playstation 4. In 2006, Sony fell into a similar position with the PS3, which also launched without a sufficient number of quality games to support the system. It’s largely believed that the PS3’s poor early adoption allowed Microsoft’s (NASDAQ:MSFT) Xbox 360 to better position itself as a major gaming contender and appeal to more developers.
 
Much like the Vita and PS3, the PS4 will likely feature some of the most impressive technology gaming has seen to date, but sometimes a console’s value and appeal are determined more by the titles it boasts, rather than what’s going on under the hood. The Vita’s price cut is being considered a smart decision by Sony, but unless the company takes steps to prevent a poor launch again, it could be slashing the PS4’s price next year. 
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