Playstation 2 Consoles Not Ready on Time

T O K Y O, Sept. 28 -- When Sony’s PlayStation 2 game console hit the shelves in March, kids in Japan thought they had waited long enough: about 24 hours and in the cold. Too bad U.S. consumers are going to have to wait much longer for their own digital delight.

Sony Computer Entertainment America, the company’s U.S. unit, said late Wednesday that it would only be able to dole out 500,000 PS2 video game units on its Oct. 26 North American launch date, half of what the firm had expected to ship.

The firm said the delay was due to a lack of supply parts for the console, though it did not specify which parts. Sony added, however, that it was still on track to meet its global sales target of 10 million units for fiscal 2001, ending in March.

Sony said the modified schedule will not affect availability of PlayStation 2 during the holiday season, anticipating there will be about 1.3 million units in supply.

Investor ReactionShares of Sony traded on the Tokyo Stock Exchange tumbled 6.4 percent on the news, pushing prices off about 37 percent from highs posted in March.

A Sony spokeswoman in Tokyo said production levels were lagging by about a month but did not explain why. She added that the launch of PS2 in Europe, planned for Nov. 24, had not changed, and about 3 million units would be shipped by the end of the fiscal year.

Many experts think the stock’s slump today is a one-time event, and the initial shock will wither in the days to come. That said, if investors thought Sony’s game division would carry the firm into rosier times, think again.

“There’s no reason to panic on the news, since Sony is telling everyone that it will still meet its global sales target,” says Hiroyuki Matsumoto, analyst at Kokusai Securities. “However, what I am worried about is if the U.S. economy significantly slows. That means Sony’s electronics business, which accounts for almost 75 percent of total sales, will definitely wither.”