Sony, Microsoft battle for online gaming market

The fierce battle for online supremacy between rival gaming consoles, Xbox and PlayStation 2, is about to hit Australia, following Sony’s decision to commence local trials of its PlayStation 2 online gaming network in August.

A registration process to allow Aussie gamers to participate in trials of the online network was launched on July 11, in conjunction with the release of the new PS2 console game SOCOM: US Navy SEALs.

PS2 users who buy a copy of the game will be given a unique registration number, which they can use to lodge their interest in the trial via the PlayStation Australia Web site. Users had until the end of July to register. Trials are scheduled to start in mid-August.

Sony said those gamers chosen to partake in the trial would receive the network adaptor used to hook up consoles to the PS2 online gaming service free of charge.

The network adaptor plugs into a dedicated bay at the back of the PS2, then links via an Ethernet cable to the user’s broadband connection.

As well as the new game, which comes with a real-time voice communications headset, potential trialists must have a PS2 console, a broadband connection, and an 8MB memory card to store their online gaming registration information.

Sony Consumer Entertainment (CE) Australia managing director, Michael Ephraim, said the PS2 online gaming service functions differently to PC online gaming networks. Instead of all game information being loaded onto Sony’s lobby servers, the majority of the gaming information for the PS2 online network will be derived from the actual console software. The PS2 lobby servers will only store information pertaining to the user’s interactive gaming environment, such as their weapons tally or their character status.

“The lobby server acts as a traffic cop for other people with a similar set-up to PS2 online gamers to co-ordinate the game between players,” he said.

While its competitors had opted to host all of their Australian online gaming information on servers in the US, Ephraim said Sony would invest $2 million into developing local IT infrastructure to support games which were “latency-intensive” (such as the new SOCOM title) for its Australian PS2 online gaming network. Player data for other types of games, such as role-playing or strategy games, would be hosted in the US.

Ephraim said the decision to build a server base in Australia was because of delays in transmitting information between players in Australia and Europe over the Internet.

“All Australian Internet traffic to Europe is routed via the US,” he said. “If we had the latency-intensive games hosted overseas, Australian gamers would lose out … [they] would never be competitive with the European users.” As a result, Aussie gamers playing latency-intensive games will be restricted to playing against users in Australia or New Zealand for now, he said, which was “better than the global environment because the quality of the gameplay is substandard”.

The Sony team continued to investigate ways to improve this issue, he said.

The PS2 online games network was initially launched in Japan and the US last year, and in Europe in June 2003. Already, 2.4 million network adaptors had been sold worldwide.

To sign up for the service, players must purchase a network starter pack, containing a network adaptor and network adaptor disk, as well as an Ethernet cable. The pack retails for US$39.95. Users must then select a title from the increasing PS2 games software collection that have been designed to work with the online gaming network. Between 16 to 20 online compatible titles would be available in Australia by the end of the year, Ephraim said.

Sony’s decision to launch trials locally follows Microsoft’s announcement in March that it would begin trials of its rival Xbox Live online gaming network in Australia.

The question now is who will get their service out to Aussie gamers first?

Although trials for the Australian service are scheduled to take place in August, Sony is yet to confirm the official live date for the online network in terms other than “Spring 2003”.

Already available in Japan, the US and Europe, Microsoft’s Xbox Live online gaming network was forecast to reach Australian shores in October.

Interoperability trials between Australian ISPs and the Xbox game server in the US are currently being undertaken and will continue through to August.

Regional director for Xbox, David McLean, said trials were on track and the team would meet its Australian launch date.

“We’ve actually engaged in these [gamer tests] earlier than anticipated and have our consumer beta tests happening now,” he said.

Similarly to Sony’s network adaptor, Xbox console players will need to invest in an Xbox Live Starter Kit in order to access the Live service. These will retail for $99.95 and include a 12-month subscription to the Xbox Live service, real-time voice communicator, starter disk and two demo Xbox Live games. Users will then need to buy Live-enabled games titles, identifiable by a “Live-enabled” logo. So far, Microsoft has released 20 games titles that can be used in conjunction with the live service.

According to McLean, the service already boasts a community of 600,000 gamers worldwide.

He said the Xbox Live service offers gamers several advantages over its standalone console. As well as being able to play games against other Xbox Live users worldwide, the service would give Xbox Live users access to content only available online, such as game updates and new Live game titles.

“Developers can also guarantee that every person playing their game on Live will be running the same version — this is very important,” McLean said.

Users will not have to keep track of updates, as they can be automatically downloaded and installed on the Xbox’s built-in 8GB hard drive, he said.

Broadband connection deals

As well as speculation over the actual arrival date of the two online networks, questions remain as to whether the two console producers will develop broadband partnerships with any local providers. In both the US and Europe, Sony has established partnerships with several broadband providers who will offer packages specifically designed for PS2 network gaming.

Sony’s Ephraim said the company was working closely with Australian ISPs, and expected bundling deals similar to those available in Europe to be released locally.

Ephraim said ISPs such as Telstra, Optus, AOL7 and iPrimus were excited by the online gaming model.

“They’re [ISPs] looking at different ways of enticing consumers to get online with PS2 and get them registered to a broadband service – whether they be existing dial-up or new subscribers,” he said.

“The entry of console online gaming will redefine what consumers look at broadband as. [Sony’s online gaming network] investment is the first step into future digital convergence.”

Microsoft’s McLean said Xbox remained “ISP agnostic” for now. But he did not rule out the possibility of Xbox Live service and console combo deals with ISPs or retailers in the future.

“We are … not looking into any exclusive arrangements but will partner with service providers and retailers to ensure the best consumer gaming experience, which we will announce nearer our launch date,” he said. “Microsoft is committed to continuing the development of broadband partnerships in Australia for Xbox Live. As the market gets more competitive it would be foolish not to offer deals, whether it be exclusive deals or competitive price offers for consumers.”

GameCube still thinking

Yet despite the push online by its main console competitors, long-standing console and video games producer Nintendo is yet to build an equivalent GameCube service in cyberspace.

A media spokesperson from Nintendo Australia said the manufacturer was still assessing the “viability” of launching an online service.

“Nintendo has no plans [to launch an online gaming service] at this stage,” Nintendo Australia PR and promotions manager, Kate Wright, said.

The company will, however, release a GameCube broadband adaptor into the Australian market later this year, that will give GameCube users the ability to connect two consoles in a LAN (local area network) configuration. Games which utilise the upcoming LAN connection will also go on sale later this year.

Xbox console sales close in on PS2

In the meantime, competition across actual consoles sales of the Xbox and PS2 continues to smoulder.

Account director at market intelligence group GfK (formerly Inform), Phil Burnham, said PS2 continues to dominate hardware sales in the Australian market, outselling the Xbox in June by 1.7 to 1.

But the gap between the two was narrowing, Burnham said.

“It’s fluctuated a fair amount since the start of the year depending on what promotions have been on offer, but the general trend over the last six months has seen the Xbox increasing its market share versus the PS2,” he said.

Burnham said that as of July 6, 281,167 Xbox consoles had been sold in Australia — about one-third of the total 819,969 PS2s sold since the console’s release in 2000.

According to Sony, more than 50 million PS2 consoles have been sold worldwide since its launch.

The GameCube continues to trail behind, with an installed base of just over 73,000 consoles in Australia.

Scarlet Pruitt from the IDG News Service contributed to this report.