Bloomberg article on PlayStation mentions NKCIF...
Sony Selling PlayStation Video-Game System to Younger Children
Austin, Texas, April 9 (Bloomberg) -- Sony Corp. hopes the future of its dominant yet aging PlayStation video game system lies with users such as 12-year-old Amy Ciulla.
Sony is winning Amy and other new users by promoting software titles like Rugrats, Hello Kitty and the Spice Girls, that appeal to young children. The strategy seems to be working: Sony said that one-third of its North American console sales during the winter holiday season wound up in the hands of children under 12. Previous company figures showed that the age group accounted for only 16 percent of users.
Sony had gained supremacy in its battle with rival Nintendo Co. by targeting older teens and young adults. Now that the company enjoys almost a two-thirds market share in the U.S., and even more in Japan and Europe, it's shifting its sights to children 12 and under, traditionally a Nintendo stronghold.
''Sony stands to make a lot of money in the under-12 market,'' said Sean McGowan, a toy-industry analyst with Gerard Klauer Mattison & Co.
Sony's push into the younger market comes as the video-game industry anticipates a cut in the retail price for both the PlayStation and the Nintendo 64 to $99 from $129, a move that is expected to expand the audience for both systems. Sony is also working on a successor to the PlayStation, which could be released in Japan by the end of this year and will work with games made for the current system.
Games Matter
PlayStation is crucial to Sony because the game business accounted for some 22 percent of the company's consolidated operating income, after corporate expenses and elimination of inter-segment transactions, in the year ended March 31, 1998.
Analysts think that if Sony successfully woos youngsters, it can sell 7 million to 8 million PlayStation systems in North America this year, about the same as last year.
''One of the keys for Sony in extending the PlayStation life cycle is how effective they are in penetrating the children's market,'' said James Lin, an analyst with Wedbush Morgan Securities in Los Angeles.
Nintendo says it's selling more games aimed at adults as Sony pushes into the younger market. One hotly awaited Nintendo title is Perfect Dark, a shooting game. The company has also seen strong sales of child-oriented titles such as Pokemon for its hand-held Game Boy device.
''Rugrats''
PlayStation has been able to lure users like Amy Ciulla with its games aimed at children. Amy had previously played both PlayStation and Nintendo games on occasion with her brother Zac, a 14-year-old video-game junkie. She wanted her own system after seeing commercials for a game linked to ''Rugrats'' the hit animated television show, which airs on Viacom Inc.'s Nickelodeon cable network.
''The PlayStation rules,'' Amy said. ''The games are more fun.''
Amy now has several games and regularly hosts PlayStation sessions for her classmates. One friend got her own system after seeing the game at Amy's house.
That's the kind of evangelism Sony had in mind when it flexed its marketing muscle to promote the Rugrats title, which was published solely for the PlayStation by video-game software company THQ Inc. in late November.
Sony helped design and pay for the television ad campaign, THQ executives said. Sony also included a preview of the game with a demo disc that comes with new PlayStation systems, and put a picture of the game on the back of the console package.
The buzz helped push Rugrats onto the list of the top 10 PlayStation games through February, according to market researcher NPD Group.
''Sony wanted to make a real statement with the game,'' said Germaine Gioia, THQ's vice president of marketing. ''It's proven to have real staying power and that's been a pleasant surprise.''
Promotion
Sony is looking for other ways to reach the younger market. It's marketing Rugrats and other games with discount coupons on the boxes of General Mills Inc.'s cereals such as Lucky Charms and Cocoa Puffs. The company also is sponsoring a sweepstakes with Farley's Fruit Snacks, a chewy fruit-flavored candy.
A kid-oriented title Sony is planning to publish later this year called Ape Escape will be the first title to take full advantage of the company's vibrating ''dual-shock'' controller, said Andrew House, Sony vice president for marketing.
Expect more PlayStation games for children, THQ's Gioia said. THQ in February agreed with Nickelodeon to gain exclusive rights for Rugrats titles through 2002 for all systems by Sony, Nintendo and No. 3 Sega Enterprises Ltd.
A video-game company called NewKidCo LLC is also beginning to introduce titles tied to the Children's Television Workshop's ''Sesame Street'' TV program, aimed at children ages 3 to 6. The company has introduced Elmo's Letter Adventure and Elmo's Number Journey, and has a puzzle game for girls 8 years and older called Hello Kitty's Cube Frenzy.
''The little kids want to play what the big kids play,'' said Hank Kaplan, president of NewKidCo, a unit of Toronto-based NewKidCo International Inc. |
