Bring on the WorkStation 3

With the launch of the PlayStation 3, the fate of one of the world’s best-known brands, Sony, hangs in the balance. Although the technology, and the price tag, of the new system will likely lead to it moving at least partially into the realm of home theater enthusiasts rather than just gaming enthusiasts wanting the latest game system, presently Sony is staking much of its future on that market. For true security, it needs a complete digital ecosystem, and for that, it needs to change its PC strategy.

The XBOX 360 and the PlayStation 3 make it clear that the video game market is no longer just about video games: it is about digital entertainment in general. The PlayStation 2 popularized the trend of the video game system as a movie player, but its successor and Microsoft’s system, when packaged with an HD-DVD drive, are the first to push an offering that seems to make the video game systems serious contenders for the home theater. Sony’s system, with HDMI and Blu-Ray, clocks in several hundred dollars cheaper than the first Blu-Ray players that started to appear this year, and seems like an attractive offering in that market. Microsoft has followed up with the said add-on HD-DVD drive with the goal of making its system similarly attractive. However, Microsoft has another card up its sleeve: Windows Media Extender.

Windows Media Extenders have existed for a few years and serve to make the digital content one stores on a Windows PC easily available from a TV in the family room. The XBOX 360 has this functionality built in, and combined with the HD-DVD player, makes it perhaps the most attractive of the next generation systems in as much as one wants an all-in-one digital media solution. Microsoft clearly has a leg up on Sony in this, since it controls a PC platform in addition to a gaming platform. Every Sony VAIO PC that comes off the line helps to further entrench Microsoft’s ability to promote the potential Sony killing XBOX 360. The Zune may make this combination even more dangerous, since the Redmond, Washington-based company can offer a complete digital ecosystem that will work together.

This need not paint a grim picture for the Japanese electronics giant. I think it is no coincidence that key people in the company have hinted at the PlayStation 3 as more of a computer than a gaming system. It has a secret weapon if only it is willing to unearth it: the Cell processor. The PlayStation 3 is interesting from a standpoint of more than just a game playing machine; if it lives up to its alleged level of power, it is also an extremely attractive platform for computing, save for the limited RAM and hard disk space. While Sony is limited in improvements to the system (and probably does not even need to make improvements) for gaming purposes, it could very easily create a souped-up version of the PlayStation 3 platform with the same amount of ram and hard disk space as a modern mid or high end computer – say 1 to 2 gigabytes of ram and 250-500 gigs of hard disk space.

What would be the good of having a gaming system with that kind of specifications? Not much, but, notice that Sony has been courting Linux for several years now. With its savvy interface designers, it could easily leverage GNOME or KDE and turn either one into something a bit more attractive, and do so fast. With a custom Linux distribution on a “WorkStation 3,” Sony would have an integrated computing platform under its control, much like Apple does. Unlike existing Linux distributors and minor OEMs, Sony has the manufacturing know-how and technology ownership to build something unique and much more interesting than any existing Linux PC – or, really, any existing PC. Yes, being dependent on an IBM processor was a liability for Apple, but note that the reason Apple lost out on its PowerPC needs was so that IBM could produce chips for Sony and Microsoft. If Sony demanded additional chips for a lower volume computer business, IBM would be obliged to comply, both because of Sony’s interest in the Cell’s design and the lucrative nature of the PlayStation chip making business.

That would take care of the hardware end, but what about software? There are three issues with alternative OSes that are perhaps the most problematic: lack of media support, lack of games and lack of general software. The first has not been a problem for Apple, but it is a problem for Linux. Thanks to the iPod, Apple has been able to push itself into a position as a big player with media companies, but it is much harder for Linux distributors to get the DRM and codec support needed; Sony, however, is in an even better position than Apple: they are one of the media giants in both music and movies.

The other two issues concern software availability. The second issue cited for home computer adoption, gaming, would also be a non-issue: the system would be a souped-up PlayStation 3, remember; it would have a better gaming position than Apple, most certainly, but it would also be better suited than Microsoft’s Windows platform. The third problem, admittedly is more difficult, but Sony’s expertise in video cameras, music players, cell phones and other items that demand good interface design would allow Sony the ability to relatively quickly create either replacements to Open Source programs for movie editing, photo organizing, etc., or to improve the state of existing programs. Importantly, it also has the brand names to make its software solution stack instantly recognizable: who would not want the Cyber-shot Photo Suite or the Handy-cam Movie Studio?

This is not to make light of the difficulties for Sony to make such a product. But as the emphasis increasingly leans towards convergence, Sony risks allowing Microsoft to win the battle on digital entertainment, a blow that could push Sony off into the precipice of irrelevance. To avert this, Sony needs to be able to provide a holistic solution, rather than supporting its enemy on an important front, the PC, the place where much of the future of digital media is stored and controlled.

Sony is one of the few companies with the technology and name recognition that could potentially pull off a feat similar to Apple and chart its own computing destiny. It should take advantage of that while it still can.

Timothy R. Butler is Editor-in-Chief of Open for Business. You can reach him at tbutler@ofb.biz.