Gamers lined up by the thousands early yesterday, aiming to be one of the first in the United States to buy Sony Corp.'s PlayStation 3, the multimedia and video game machine that is key to the future of the beleaguered electronics and media conglomerate.
Several of the weary shoppers had queued for more than two days outside Sony's midtown Manhattan store and had improvised creature comforts from street junk. They turned discarded bags of shredded office paper into billowy chairs and a lamp shade sheltered one man from the rain.
The celebratory tone overshadowed what has so far been a tough year for Japan's Sony, which has suffered through a recall of nearly 10 million of its computer batteries, delays in the PS3 and a growing price war in the flat screen TV market.
Shrugging off his company's woes, Sony chief executive Howard Stringer made light of himself before the crowd of gamers, most of whom were dressed in sweatshirts, jeans and T-shirts.
"I know I'm standing here in a stupid suit, but I'm actually happy," he told the crowd.
Sony is sure to rake in millions of dollars in revenue yesterday alone, with some 400,000 units expected to be available one week after an initial launch in Japan. Depending on the size of its hard drive, each PlayStation is selling for $500 or $600.
But Sony is expected to lose money initially on each sale of the PS3, which in addition to playing games, can surf the web, download video and music and play movies with its Blu-ray high-definition disc drive. The Blu-ray player and other components have run up production costs, dragging Sony's game unit into a deep loss for the year to March.
Experts suggest each PS3 could last 10 years and could go a long way towards helping Sony meet its goal of keeping atop the $30 billion gaming market, as well as make Blu-ray the standard for next-generation DVD.
"Gaming is our primary focus, but the PS3 does so much that it can become the centre piece of a home entertainment system," Kaz Hirai, chief executive officer of Sony Computer Entertainment America, told Reuters in an interview before the event.
Analysts say the PS3's high price could deter non-gaming consumers and loosen Sony's grip on the console market, in which it faces tough competition from Microsoft Corp.'s Xbox 360 and Nintendo Co. Ltd's Wii - a view Sony executives say is wrong.
"They will sell out of the 400,000 (units), with the hard core gamers," said IDC analyst Danielle Levitas. "But with Blu-ray, they are betting their strongest business unit on a technology that it's not clear most consumers want." Despite the dramatic launch, actual PS3s may prove to be a rare sight compared with rival machines. Microsoft expects to have shipped 10 million of its one-year-old Xbox 360s globally by December 31, while Nintendo is targeting four million Wiis - that's double the number of PS3s expected. US sales of the Wii start this weekend.