First indications: Sony's Playstation 3 is impressing consumers

[Sony's Playstation 3 conceptual designs shown at the 2006 Consumer Electronics Show]

BusinessWeek just posted an Associated Press article about very positive reactions to Sony's Playstation 3 at the 2007 Sony Expo in Honolulu. And as expected, people with PS3s pre-orders are already asking $2,000 and more on eBay. Despite it being about two weeks to launch, PS3 mania has begun.

The early returns are saying what we've been saying for more than a year now: despite Microsoft's XBox 360 having a one-year lead, Sony's Playstation 3 is poised to dominate Christmas 2006. And while Sony has made numerous marketing missteps, it has done one thing right: it has focused on making a great product. Everything from its sleek packaging to its whisper quiet operation to its free online service say to consumers that PS3 is worth the money and effort to acquire one. It's hard to resist products like this that have such care lavished on them.

What about XBox 360's one-year lead? Sadly, according to one analyst, XBox 360 purchases are actually trailing the adoption rate of the original XBox, to say nothing of Sony's PS2 or PS3 platforms. So while Microsoft may have shipped six million units in the last year, its ship rate is currently falling quarter over quarter. Worse, Sony's last generation platform, the Playstation 2, is still outselling XBox 360s each quarter. And that leaves Microsoft extremely vulnerable to being rapidly eclipsed by what is stacking up to Sony's better-executed follow-on platform.

We'll get a good read on how well Playstation 3 will do when it goes on sale Saturday in Japan and then is released in the US a week after. The real answers will come from consumers voting with their wallets for what is now the highest-priced video gaming console ever released. But those high prices will help keep demand in check and Sony's revenues aloft during the first few months of availability, when supplies will be limited. And if we believe the initial reactions, consumers may rapidly conclude what Sony has been claiming for more than a year now: that they are willing to save more and pay more for what may turn out to be the best platform on the market.

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