Sony Puts Network at Center of Mid-term Strategy

Sony is getting ready to directly link its consumer electronics products and considerable movie and TV content libraries.

Later this year the company will begin providing video content to PlayStation 3 users via the recently-launched PlayStation Network, and will start a streaming video service for owners of Bravia TVs with a network connection.

"This continues to be one of the clearest opportunities for Sony to leverage its entertainment assets to differentiate its electronics products," said Howard Stringer, chairman and CEO of Sony at a Tokyo news conference.

As part of the push the company will increasingly build Internet connectivity into its products. By March 2011, it plans to have network-enabled and wireless capable products available in 90 percent of its product categories, and aims to roll out the video services to key devices by the same date.

The PlayStation 3, which shipped with an Internet connection from launch, is one of its most widely used network-capable products beyond PCs. Around 50 million of the consoles are in the hands of consumers and just under 10 million accounts exist on its PlayStation Network, which is used largely for games.

"We have an enormous global installed base upon which we can build network services," said Stringer. "With the inclusion of our Blu-ray player, Wi-Fi and hard drive in every PS3, I am confident that the PS3 is the network home entertainment server of the future."

The next step in the roll-out will be to extend the PlayStation Network to personal computers and later to networked consumer electronics products like televisions and Blu-ray Disc players, many of which can already be hooked up to the Internet. Portable devices like the video Walkman and Sony Ericsson cell phones will also be supported.

Before the PlayStation Network gets to televisions Sony will begin offering streaming content via Bravia Internet Video Link, an Internet contents service it launched in the U.S. in 2007. The Bravia service will launch in the U.S. later this year and in November Sony Pictures will offer the upcoming Will Smith movie, "Hancock," at no cost to all Internet-connected Bravias before the movie's DVD release.

"Sony now has the capability to deliver feature films and television shows of ours or our peers directly to consumer televisions across the open IP network outside the conventional satellite, cable or terrestrial distribution systems ... This initiative is a clear but important glimpse into the future of home entertainment," said Stringer.

For Sony the network strategy has been a long time coming.

Despite enjoying a position as one of the biggest creators of movie and television content in the world and one of its top consumer electronics companies, previous attempts to directly link with consumers, through services like Mora or Connect, have failed in part because Sony chose its own systems over those with wider support in the industry.

But the company's reliance -- or insistence -- on its own technology has changed in the years since Stringer took over.

The new PlayStation Network service, for example, will use Marlin, an open digital rights management system that was developed by Sony, Panasonic, Samsung, Philips and Intertrust.

"We will embrace open standards to improve interoperability among all of our customers' devices," Stringer said.

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