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Thursday, July 24, 2003
PlayStation fights falling sales

Sony will have to face up to falling demand for its PlayStation 2 games console in the future, say analysts. Figures from the Japanese electronics giant showed a rough three months for the console, with shipments of the PS2 down by almost two million, compared to the same time last year.

"It will start to slow naturally," said Adrian Drozd, managing analyst at Datamonitor. "Most people who want a games console already have one."

But he said Sony should not be worried by the latest figures as the PS2 is still the undisputed king of the console market.

More than 50 million PS2s have been shipped since the console was launched in Japan in March 2000.

By comparison, Nintendo's GameCube and Microsoft's Xbox, are languishing around the 10 million mark. Sony's rivals may take some satisfaction from the figures showing a slowdown in sales of the PS2.

Shipments of the console dropped by 42% to 2.65 million units for the April to June period, compared to the same time last year.

The large drop is partly due to bumper sales of the console this time last year. A wave of drastic price cuts led to a surge in demand as people snapped up the machines.

This year, prices have remained more or less static, so it is hardly surprising that sales are down compared to 2002.

"The PlayStation had a very good period last year," explained Mr Drozd. "Prices have got to the point where it is difficult to lower them further."

He said the next boom in console sales will come when the next generation of machines are released in two or three years' time.

Instead, console makers will be concentrating on services like online gaming to boost their bottom line.

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