GamesIndustry.biz: The Fog of War

"FUD", standing for Fear, Uncertainty and Doubt, is an acronym first coined to describe IBM's heavy-handed attempts to warn its customers away from competing products. More commonly, it has been used to describe Microsoft's approach to competitors, a careful PR move which the firm has used to undermine confidence in other products since the eighties. Although it exists outside the technology markets, it's no surprise that FUD was coined in this sector; it thrives in an area where many customers have only a vague grasp of the workings of the product they buy, and are easily swayed by an appeal to fear.

In general, companies use FUD tactics against the products of their competitors - and there's no doubt that in the videogames industry, Microsoft has applied FUD very successfully against Sony's PS3 in a few significant instances. However, the pall which currently lies over the PS3's launch may be full of fear, uncertainty and doubt, but it's not of Microsoft's making. Rather, it's a cloud of Sony's own creation - a rare and unfortunate instance of a corporation managing to FUD its own product rather spectacularly, albeit with willing (and certainly unwanted) help from the media along the way.

With the launch of the PS3 still a work in progress, Sony has battled to keep anyone convinced that a March date is really on the cards for Europe - including, seemingly, its own executives, with corporate boss Howard Stringer managing to peg the European launch for April in a recent interview. This added to a stream of speculation over the launch date which kicked off last year when Sony's worldwide studios boss Phil Harrison declined to comment on the March date - an innocent enough thing to do, since he runs the firm's software efforts and presumably has little involvement with the details of hardware launch schedules, but one which was pounced upon by the media as evidence that the firm was wavering in its commitment.

From tiny acorns, great oaks grow - and by the time Christmas rolled around, senior publishing figures around the UK were happy to openly (albeit off the record) speculate that the PS3 simply couldn't launch in the March timescale, with some going so far as to peg September as the date. It's unlikely that any of this was actually based on insider information, of course - the industry itself is as prone to baseless speculation as the media which surrounds it - but these comments, and the breathless reporting on them in the media, can't have helped the perception of Sony as a company whose plans for PS3 were up in a heap.

Over Christmas and New Year, though, a seemingly more serious problem emerged - with anecdotal reports from North America suggesting that the PS3 is languishing unsold on shelves across the continent. This, at least, should extinguish some of the doubts about the European launch date - after all, those reports were largely based on the assumption that Sony wouldn't be able to divert enough stock from the USA to satisfy a decent European launch by March - but this medicine is more bitter than the ailment it cures, and uncertainty over the prospects for PS3 is unsurprisingly high as a result.

As to the truth of the matter - who can say? The closest thing to a proper study into the question of Sony's stock levels is a check of the channel carried out by American Technology Research pundit PJ McNealy, who found that 28 out of 52 stores polled had units of the PS3 in stock, while none had Wii units. SCEA claims that this has more to do with good management of the supply chain for PS3 than actual demand; online speculation, of course, points to underwhelming demand for Sony's expensive console. The truth may lie somewhere in the middle, but the truth isn't really important - what's important is the FUD, and there's nothing that will spread FUD over a product as effectively as a seemingly undersubscribed launch.

And so to Europe, where the console will - apparently - finally roll out in March. Already the murmurs are there; this week brought with it discontent over the price point of the system, which is pegged somewhat higher in the UK than on the Continent. UK retailers demanding higher margins is the reason being bandied about in some quarters; either way, it's deeply unfortunate that Sony has decided to price the system above the psychologically important 400 pound level, not least since the company has its work cut out for it undoing the horrendous FUD spread by PlayStation boss Ken Kutaragi when he went off on one several months ago about how people were going to have to work overtime to afford the new system. The lack of a 20GB model in this market will only serve to exacerbate price comparisons.

FUD is all about having question marks in places where there should be no questions, and the PlayStation 3 undoubtedly still suffers from this to a huge extent. People - both consumers and industry workers - are uncertain about the prospects for a machine priced at this level, and question whether Sony will be forced to implement a price cut early in its lifespan to invigorate demand. There is a huge question mark over the Blu-ray format, which is usually cited by Sony as the reason why the PS3's price point is reasonable - we don't doubt (as many do) that the format has the possibility of improving PS3 games greatly, but from a consumer standpoint, hardly anyone actually wants a Blu-ray movie player right now and few will be happy with the idea that they should be okay with the PS3's price point because it nets them a Blu-ray player for free. After all, neither HD-DVD nor Blu-ray seem to be making the headway their proponents wanted from them - and there's an increasingly strong feeling that neither format may be appealing enough to consumers to take off. Of course, there's the question of online services; many feel that Sony isn't moving fast or far enough to catch up with the headstart Microsoft has with Xbox Live, and they may well have a point.

Questions, questions, questions; fear, uncertainty, doubt. Whether any of this will actually matter when games like Metal Gear, Final Fantasy, Gran Turismo and the like are on shelves is a question in itself - but for now, there's a cloud over PS3 whose presence has nothing to do with the system's rivals. Only time will answer these questions, of course, but for now one thing is clear - the launch of PlayStation 3 is only the start of the race, and it's going to be a tough race for Sony. The continuing dominance of PS2 is a positive point for the firm, but by no means a guarantee of future success - and with both Nintendo and Microsoft snapping at its heels, the pressure is on Sony to deliver, to silence its critics, and to clear the air of the FUD which has gathered over the most important product in the Japanese firm's history.