The Sony Playstation, A Story of Video Game Dominance

A very public corporate betrayal in the early 1990s led to an upheaval in the video gaming world that would result in the toppling of an industry giant one short decade later. In the first decade of the 21st century, Sony Corporation (NYSE: SNE) would ascend to dominance in video gaming, at least for a few years, on the strength of its PlayStation system. 2014 has been a kind year thus far to Sony; one year after the release of both consoles, Sony’s PlayStation 4 could be outselling Microsoft’s Xbox One by as much as 2-to-1. No stranger to breaking sales records in video gaming circles, Sony has captured the Australian market with the PS4, which has sold more in that country than any other video game console ever. Sony has been extending the PlayStation console format to more than just home video gaming systems and though the PlayStation TV hasn’t been enjoying incredible sales, the streaming television services offered by this small device may make it an important part of the eighth generation of video gaming consoles.

In our continuing coverage of major players in the 2014 Black Friday sales season, we’re taking time today to profile the brief yet intriguing history of the PlayStation. The multiple generations of this video game console which Sony has brought to consumer markets have been very successful for the company and came during a time when video gaming became much more mainstream, capturing a wider portion of the global consumer base than ever before.

The growth of Sony towards becoming the industry leader in video gaming during the early 2000s followed a major shift in video gaming technology from electronic cartridges to compact discs, which could hold more data and support more complex graphics and audio. Although Sony has since slipped somewhat, it is still dominant within the video game sector. In today’s brief history of the PlayStation gaming console system, we’ll see how a company showed resilience in the face of major obstacles in order to change the playable format media for all video gaming consoles.



Nintendo, Ken Kutaragi and the Birth of CD-Based Video Gaming

The use of compact discs in video gaming console technologies wouldn’t be widely seen until the 1990s, but by the end of the 1980s video game developers were pursuing the use of CDs for their consoles. Nintendo, then the leading name in video gaming with the success of its Nintendo Entertainment System, entered into discussions with Sony, a corporation with expertise in electronic storage media. The goal was to develop an add-on device for the Super NES being developed by Nintendo which would add the ability to read CD-ROM games along with the console’s native ability to read Nintendo cartridges. Placed at the head of Sony’s project was Ken Kutaragi, a hardware engineer who had been working with the corporation.

A great deal of mistrust between the companies would turn out to be the downfall of this project, however. Sony wanted to use the project in order to create “Super Disc” technology that could be a huge boon for the company and the deal they struck with Nintendo made Sony the sole licensor of the technology that was being developed to be the future of gaming. This made Nintendo nervous and the company began pursuing other avenues for the development of the CD-reading add-on device.

From U.S. Patent No. D367895, titled “Game Machine.”

The Consumer Electronics Show during the summer of 1991 held in Chicago would have to be considered the low point of Sony’s involvement in video gaming. On Friday of the convention weekend, Sony announced its partnership with Nintendo to build a “Play Station” (this two-word title would be elided in later years). The Super NES add-on could support play of both game cartridges and compact discs. The very next day, Nintendo publicly announced at the CES that they were in discussions with Dutch electronics company Philips N.V. involving a different compact disc-reading add-on to the Super NES. Philips was already a major global competitor with Sony in televisions, radios, compact disc players and more. The announcement was confusing to the public and deeply angered Sony President Norio Ohga, who quickly placed Kutaragi at the head of a project for designing a complete game console that would be entirely Sony’s property.

It’s interesting that, for such a public betrayal among major names in technology, both sides were able to put their differences to rest for business. The Phillips CD-i device that was eventually created became a commercial failure, but Nintendo successfully protected its leading position in the video game industry through the 1990s. Sony continued to earn money selling the audio chips developed by Kutaragi to Nintendo for use in their game cartridges; this supply partnership existed before the 1991 CES and wasn’t hampered by it. Even though Ohga wanted Sony to develop its own console, the ability to play Super Nintendo game cartridges was still desired. Eventually, Sony would build the first line of PlayStations in 1992 which could play both CDs and cartridges. Only 200 were made and the console was never released commercially.

In December 1994, Sony released the first widely available PlayStation console, a video game system which only processed games stored on CD-ROMs. The decision to move away from game cartridges would have a major effect on future generations of video gaming technology. Within three months, one million PlayStation units were sold. By November 1993, Sony had also established Sony Computer Entertainment, the creative side of PlayStation which would contribute to both game and console development over time. Before the PlayStation was ever released, Sony was able to sign on 250 video game developers to build a deep library of games for the company.

From U.S. Patent No. D382603, entitled “Controller for Computer Game.”

We were able to turn up a couple of patents issued by the U.S. Patent and Trademark Office which protected Sony’s position in regards to its optical disc technologies and other features of the PlayStation. We found some intriguing design elements that might evoke some nostalgia in video gamers protected both by U.S. Patent No. D367895, titled Game Machine, as well as U.S. Patent No. D382603, entitled Controller for Computer Game. Improved techniques for recording digital material onto a compact disc was protected for Sony through the issue of U.S. Patent No. 5390158, entitled Method for Recording and Reproducing Compressed Audio PCM Data On and From Optical Disc Using Adjustable Interleaving Factor. This method of compressing audio data reduced audio deteriorations that could be caused when recording audio and animated image data concurrently. Protecting the quality of audio data during disc recording operations involving video or animated image data is also the focus of U.S. Patent No. 5539716, titled Optical Recording Disc With Compressed Audio PCM Data Interleaved With Video Data.



Ascending to Dominance With the PlayStation 2

The PlayStation and the ushering in of 32-bit, CD-based video gaming earned Sony a place at the table with Nintendo and Sega, the other major names in the video gaming industry. It would be the PlayStation 2, however, that toppled the entire industry and tilted everything in Sony’s direction through the very first few years of the 21st century.

The sixth generation of video gaming got underway in 1998 when Sega released its Dreamcast console, which had some Internet capabilities thanks to a 56K modem. Fifteen months later, Sony released the PlayStation 2 in 2000, a full year before Nintendo’s GameCube and Microsoft’s Xbox would reach the market. In its first year, the PlayStation 2 was actually outsold by the PS One, a portable version of the original PlayStation console released by Sony that same year. The PS2, however, including the more compact Slimline model that was released in 2004, would go on to become the world’s most commercially successful video gaming console; more than 155 million PlayStation 2’s would eventually be sold to consumers. It’s also pretty telling that the original PlayStation and the PlayStation 3 are the 2nd- and 4th-best selling consoles of all time, respectively.

Part of what made the PlayStation 2 so commercially successful with video gamers was its backwards compatibility. To enjoy the improved power of the PS2, it wasn’t necessary for a gamer to spend hundreds of dollars on new games while yesterday’s favorites gathered dust on a shelf. Some very successful game series which had found a home on Sony’s console, such as Final Fantasy, Metal Gear Solid and Resident Evil, were able to be used seamlessly on either the original PlayStation or the PS2. It’s somewhat surprising to note how limited the PlayStation 4 and Xbox One are in terms of backwards compatibility given the popularity of the PS2’s ability to play games developed for the original Playstation.

The PlayStation 2 also enjoyed an incredibly long production life. Games for the PS2 were still being released in 2013, seven years after the release of the PlayStation 3 and close to the release of the PlayStation 4. In terms of video game development, that would be somewhat akin to Nintendo continuing to release Super NES cartridges right as the company would be releasing the GameCube.

Sony also made some attempt to break into the handheld video game market, a sector that hadn’t fully been explored by a company outside of Nintendo since it established complete dominance of consumers with its series of Game Boy devices released throughout the 1980s and 1990s. In 2005, the PlayStation Portable, or PSP, entered the fray. It was designed to enable the delivery of some Internet content to users, such as music and video. Handheld video gaming was not to become a success for Sony, however, as issues with hackers cracking PSP programming codes and incredible competition from Nintendo’s DS handheld gaming system would prove to be substantial issues.


The PlayStation Matures: The PS3 and the PS4

The PlayStation 3 did not have it’s North American release until November 2006, giving the Xbox 360 a full year’s advantage in the battle waged for the seventh generation of video gaming consoles. It did not suffer from the “Red Ring of Death” that made the early years of the Xbox 360 so fraught with chaos for Microsoft. It did have some problems with incorporating the Blu-ray disc reading technology developed by Sony but this was an important component of an entertainment system that was designed to support high-definition video with 1080p resolution.

The PlayStation 3 did not sell as well as the PlayStation 2 and would in fact be outsold by the Nintendo Wii, Nintendo’s seventh-generation console, mainly owing to the per unit price of the PS3. The console cost at least $499 for the basic model, with the upgraded 60GB hard drive retailing for $599. The Xbox 360 sold for $399, and even that was greater than the $299 price point that had been established for consoles during the sixth generation.

With its PlayStation Network online gaming service and large hard drive, it’s clear to see how the PlayStation 3 took a number of cues from the popularity of some of the Microsoft Xbox 360’s features. Issues posed by hacking continued to loom over the company and in 2011, Sony suffered the blowback from a major security breach that some feared may have compromised tens of millions of credit card accounts. As with the PS2, Sony released a slim version of the PS3 in 2009 that was two-thirds the weight and size of the original PS3 which sold more than one million units within three months of its release.

The current struggle for video gaming supremacy is being fought among the eighth generation of consoles, featuring the PlayStation 4, the Xbox One and the Nintendo Wii U. The seventh generation finished up much more evenly than the sixth generation, which was dominated by the PS2; the seventh-generation Wii sold about 100 million units, while the Xbox 360 and PS3 each sold around 80 million units. The PS4 shares many of the computing features available through the Xbox One, including a 500GB hard drive, wireless Internet connectivity, 4K video support, gigabit Ethernet and more. Some issues with faulty HDMI ports were experienced by users during the initial rollout, but the extension of online services through the use of the PlayStation App and the availability of other third-party services like Netflix has turned the video game console from a toy into a computing device for lifestyle enjoyment. With some rumor that Sony is interested in developing virtual reality headsets for use with the PS4, it’s clear to see that there’s still plenty of research and development that continues to be pursued in the area of gaming and home entertainment consoles.


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Join the Discussion

2 comments so far.

  • [Avatar for Truth]
    November 27, 2014 07:31 am

    $0N¥ sits on a throne of lies and overhype. That’s all they’re good for and the PS4 selling well won’t save $0N¥ in its entirety. You can’t make up for Billions of dollars in losses every quarter with just a couple of 100 millions in profits. They’re doomed to failure no matter what. Poor paupers.

  • [Avatar for miyamoto]
    November 25, 2014 11:35 am

    Oh man, I used to be the No.1 PlayStation hater during the 1990’s and was an avid Sega Genesis supporter.
    Its good to root for a company that has entertained you very well at a young age and “change” is something many people find it so very hard to accept specially when they are at the “comfort zone”

    But PlayStation being the newcomer underdog upstart it was in 1995 surely schooled Nintendo and Sega how to make a dramatic entrance and rock the videogame industry very hard!

    PlayStation sure know how its done!

    PS debut double knockout the betraying Nintendo and snubby Sega!
    Both companies denied Sony’s partnership into the gaming industry and when Sony went in on its own, they realized they created their own nemesis.
    What a beautiful story!

    PS2 defended its championship with a triple knockout of Nintendo, Sega and Microsoft!

    PS3 is the comeback king of the ring!

    PS3 came in with new and expensive technology like Blu-Ray, Cell processor, strict anti-piracy technology costing Sony so much in a time of economic crisis. No platform has ever done a successful comeback like it.
    PS4 proved that PlayStation is still the Greatest Champion of Gaming of all time!

    *and Nintendo and M$ still don’t know the PlayStation’s secret weapon even after 20 years. heheheh.

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