Can the PlayStation 4 Revive a Waning Sony?

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Sony (NYSE: SNE) has a popular video on YouTube right now implying that they will reveal the new PlayStation 4 on Feb. 20. Is this Sony’s moment to finally outshine the Microsoft (NASDAQ: MSFT) Xbox 360? Maybe, maybe not.

First some history: Microsoft released the Xbox 360 in North America Nov. 22, 2005. It was a follow-up to the original Xbox and a leap ahead technologically. While the original Xbox competed with the wildly successful PlayStation 2 from Sony, when the Xbox 360 came on the scene gamers would have to wait almost an entire year (until Nov. 17, 2006) for the PlayStation 3.

A year in digital terms is somewhat akin to an eternity and gamers in general are not a patient lot. Despite the fact that the PlayStation 3 sports Blu-ray, it was too little too late to ever catch the Xbox 360 with its 12-month lead. To date the Xbox 360 has sold 75.9 million units worldwide. The PlayStation 3 has sold 70.2 million units. Clearly both consoles are successful, but the Xbox 360 is more successful, despite the fact that Sony owns more game studios and has more exclusive content.

Now let's look back one generation of consoles and see how that was reversed. The PlayStation 2 sold an amazing 155 million units compared with the Xbox’s mere 24 million units. Why? PlayStation 2 was released March 4, 2000. Xbox didn’t release until Nov. 15, 2001. It never caught the PlayStation 2, not in terms of console sales and not in terms of available games. 

The PlayStation 3 was officially unveiled at E3 on May 16, 2005, but was then plagued by delays for global release dates, frustrating gamers around the world. The price gap between the two systems was significant. The PlayStation 3 started at $499 without WiFi and $599 with WiFi. By comparison the basic Xbox 360 was $299, the backward-compatible model that would play original Xbox games and came with other extras was $399. Neither of the original Xboxes came with WiFi. That would be added to later models. Remember though, that in 2005 WiFi was not ubiquitous and expected in devices the way it is now.

So is Sony going to have a big stock jump or not? I don’t know. Will the PlayStation 4 be delivered on time? Will it be priced right for this economy? Will it offer gamers enough to make them upgrade early rather than wait for prices to come down? Sony has been on a gradual decline over the last few years and there has been a great deal of speculation about the once great entity, but it still has a market cap of $15.18 billion, so it’s hardly gasping its last breath. On the other hand, when you compare that to Microsoft’s market cap of $233.95 billion, it hardly seems like a level playing field.

As someone who has owned and loved many a Sony product over the years, I would love for the PlayStation 4 to sell like mad. However, as someone who owns both the PlayStation 3 and the Xbox 360, I confess to playing the Xbox 360 more by a ratio of at least 5:1, and I had the PlayStation 3 first. My Xbox 360 is the only Microsoft product I own, but it’s a good one.

My prediction: This all comes down to release dates. I’m very curious to see Microsoft’s response to the Feb. 20 video and I’m sure we’ll see it very soon. 

Postjade has no position in any stocks mentioned. The Motley Fool owns shares of Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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