Beating the pants off Xbox: Sony Australia on the early console war victories

Friday, 14 November 2014 12:07 GMT By Brenna Hillier

PS4 is triumphant, dominant and graciously victorious once more – for now. We chat with SCE Australia managing director Michael Ephraim as PlayStation approaches a full year at the top of the charts.

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Last week I attended an event hosted by Sony Computer Entertainment Australia, where I played a couple of demos and ate middling fish and chips*. It was one of a number of do’s the company throws towards the holidays to catch its partners and contacts up on happenings of the past year, and SCEA took the opportunity to make a couple of announcements specific to the Australia-New Zealand market, fortuitously on the occasion of the PS4’s one year anniversary.

*Full disclosure is fun!

The event took hours and hours and hours and I was last in line for an interview, so after I’d played all the demos and used up my phone battery playing Doctor Who and Bonza, I got bored and ate everything the staff brought me, just to see if I could (I couldn’t). I also drank a lot of mineral water and one beer, and went home doing amazing burps. Pat made me go back to work** for two hours because he is a slave master.

**This is untrue; I was actually motivated by intense guilt. Just like every day!

These announcements aren’t of huge interest to VG247’s international audience, but there’s one that’s worth noting anyway, because although Australia and New Zealand have their own fashions and market trends, in this case we follow the leader. It’s this: the PS4 has been named fastest-selling home video games console in Australian history by the local branch of the NPD Group.

In the year since the PS4 launched, Sony has taken every possible opportunity to share sales figures, new records and other snippets of information. Microsoft, on the other hand, is having a hell of a time putting a positive spin on sales reports. The Xbox One is doing pretty well, and will no doubt do even better when it launches in more territories, but the PS4 is consistently outselling it, and that’s difficult to bluster through. It’s because of this we get announcements like “We’ve sold 10 million units. To retailers. Nearly.”

There is actually something to crow about in Microsoft’s recent announcement; sales tripled week-on-week when it dropped the price, and as a result, the Xbox One finally outsold the PS4. Whether it can sustain this momentum is debatable, because there was no doubt a huge pool of potential Xbox One owners who were just waiting for the inevitable price match with the PS4, and they’ll be exhausted soon. As for holiday purchases, well – Sony’s got just as much chance of riding that wave as Microsoft, and given that these things tend to snowball, maybe more momentum.

It’s possible Microsoft’s clever holiday promotion will be enough to see the Xbox One dominant over the holidays, and maybe even bring us back to the head-and-head race that made most of last generation such a pleasant period, because despite what Xbox fans believe, the PS3 and Xbox 360 sold pretty equal amounts in the end.

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I asked Sony’s Australian PR agency for a photo of Michael Ephraim on a horse, so I could badly Photoshop a PlayStation logo on its ass and have him trampling Xbox Australia under its mighty hooves. They didn’t come through, but also they didn’t blacklist me, so I call it a win.

If I ever interview a Microsoft bigwig, I’ll put in the same request. The console war will be won on propaganda.

It’s such a reversal of fortunes, going from the supposed underdog of one generation to the early leader of the next, that it’s easy to forget that this is something of a homecoming for Sony, which indisputably ruled the roost for two generations in a row before the Xbox 360 upset the apple cart. Almost exactly 20 years after the PlayStation brand launched in Australia, I spoke to SCE Australia managing director Michael Ephraim about how it feels to beat the pants off Xbox – my words, not his, as you don’t become managing director of anything by name dropping your competitors.

“I’ve been with PlayStation for 20 years. I live and breathe the brand. I love the brand. It’s nice to feel the feelings we had when we launched PlayStation One,” he said.

“It has a similar feel about it right now. When we launched PlayStation one, there was no Internet, there was no Apple – there was nothing. The PlayStation One was the biggest thing since sliced bread. And we’re starting to feel that kind of feeling now, that we’ve delivered to consumers and gamers what they want.

“And it feels great. It feels really good. We’re still not gonna rest on our laurels. Very competitive market. We know consumers have choice. We wanna just deliver on our promises of what we said PlayStation 4 would be. But yeah, we’re definitely happy that it’s been accepted so well.”

Smiles all round, then, but this celebratory event was held in the wake of the release of PS4 firmware 2.0 Masamune, which delivered Share Play and YouTube, two features long expected on the year-old console – and some highly unpleasant bugs.

“When we launched PlayStation one, there was no Internet, there was no Apple – there was nothing. The PlayStation One was the biggest thing since sliced bread. And we’re starting to feel that kind of feeling now.”

“Listen: we’re really, really apologetic. Dealing with network and digital – I’m not trying to spread or deflect anything, but dealing on such a robust network is a tricky experience. The good thing is we’ve launched 2.01, which has fixed the rest mode, and has fixed the YouTube app,” Ephraim said of the firmware blunder.

“It was very unfortunate. We hate that. The network was down during the 2.0 release. It’s very unfortunate. Those things are gonna happen over time. We’re not bulletproof on those things.

“I think the good thing is, we reacted quickly and the fix is out, about two or three days after. So we apologise. Like I said, dealing with global network loads and concurrent users for a platform that is ever expanding because of our sales being so strong is tricky at times, and we’re not infallible.”

It’s important that Sony present an infallible face over the next few months as it receives the usual surge of new members over the holidays. For the past few years, I’ve been baffled by its approach to the holiday season – why is there always an enormous gap in the first-party release schedule, with huge properties like God of War and Uncharted taking a backseat to ModNation and PlayStation All-Stars: Battle Royale?

According to Ephraim, this is quite deliberate: gamers are already well-served over the holidays, so Sony can concentrate on capturing new markets.

“There are heavy-hitters,” he said. “Grand Theft Auto 4. Call of Duty just came out. Assassin’s Creed’s coming out. Far Cry 4 looks brilliant. So I think there are a lot of heavy hitters for gamers.

“But our focus this year is bringing in the mass market as well.

“With LittleBigPlanet 3 – basically a new game where you’ve got three other characters, a storyline, a villain – that game appeals to gamers, but it also appeals to younger audience and the mass market. I’m very excited about SingStar, because I know what that brand means in this country. It started social gaming in this country. We’ve sold 1 million mic sets for SingStar in Australia alone. We’ve sold 2.3 million discs here, and our brand trackers shows that there’s an 88% brand recall on SingStar. Any time we present SingStar there are smiles and cheers because the brand is known.

“So, there are big games coming out for gamers, and then we’ve got LittleBigPlanet 3 and SingStar for more the mass market. Then there are some other third-party publishers pushing Lego Batman – if you look at this gen, the gamers have been enjoying themselves. Watch Dogs, destiny, InFamous – there’s been some great content for gamers and there’s gonna be more coming out, but we’ve gotta start appealing to the mass market as well.”

Part of expanding to mass market is growing the PSN, which is now officially known as the Sony Entertainment Network, and delivers movies, music and other content to a wide variety of devices. Ephraim wouldn’t be tempted into discussion of what Sony’s doing to build up the PSN in terms of infrastructure, but did talk about the platform holder’s plans to expand its reach.

“Everything regarding the PlayStation Network has improved, I think everyone would agree, since we launched the PS3 network. The extent of the network has grown tremendously,” he said.

“Consumers now are more au fait, and live with digital content, than when we launched PS3. The plan is to build our ecosystem with PS4, with Xperia Z, with PlayStation TV, with SharePlay – it’s all about delivering what we’ve been saying is the socially connected experience.

Price wars?

The shopping links in this section are unlikely to work outside Australia, so here are screen grabs showing the prices for Call of Duty: Advanced Warfare on PS4 as of November 14, 2014.

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Australian PSN ($99.99)

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EBGames, a local GameStop subsidiary ($99.95)

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Target Australia ($69)

“That’s really what we’ve been working on – to launch new devices, or innovation like Share Play – to take gaming where it’s … gone. It’s become very socially connected. PlayStation 4 being compatible with iOS and iPhone in so many different ways from SingStar App for the microphone, to watching a friend play, to second screen. So I think that’s our intention, to keep bedding down the ecosystem, expanding out communities online, and then keep innovating.”

Ephraim’s mention of consumers becoming more conversant with digital gaming struck a little bit of a nerve, because if there’s one thing that Australians have learned in the digital age, it’s that we pay a lot more for video games than our International brethren (and if you give me any lip about higher salaries I can show you some great charts about average wages versus cost of living inflation).

Recently, we highlighted the disparity between retail and digital pricing in Europe. In Australia, digital pricing is in lockstep with traditional retail like specialist chains, but by shopping at huge general retailers like Target, you can save nearly a third off the price.

Australians are savvy consumers – that’s a polite way of saying among the most notorious content pirates in the world – and we don’t like paying the Australia tax when we can see the “real” price of games on the North American PlayStation Blog, let alone a premium for purchasing direct from Sony as opposed to wandering down to Kmart or whatever.

“If you look at our pricing, we are competitive in Australia with retail,” Ephraim insisted. “It’s hard to keep up with retailers. Many people have come out here, globally, and said retail in Australia is insane. It’s very competitive.”

I guess if you consider the competition retailers like EBGames he’s right, but there’s definitely a battle to be won in this specific theatre of war, and either Sony or Microsoft has to make a move on it eventually. Sit tight, armchair generals; this is gonna be a fun couple of years.

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