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To: Mihaela who wrote (37363)	2/22/2000 9:27:00 AM
From: Mihaela	Read Replies (1) \| Respond to of 93625

Playstation2 seen luring Japanese online BY EDWINA GIBBS TOKYO (Reuters) - When Sony Corp's PlayStation2 game console hits store shelves next month, the samurai warriors and battling monsters it brings to Japanese homes may become the advance force for an Internet revolution. Although the much-anticipated PlayStation2 will not offer Internet access capability until next year, analysts see huge potential for the machine eventually to rank alongside, if not outclass, mobile phones and personal computers as a major online platform for Japanese consumers. Sony plans to use the PlayStation2 to distribute game software, then music, then movies and a vast array of electronic goods directly to consumers online. And that doesn't even include the possibilities for Sony's newfound interests in online banking and stockbreeding. ``It's hard to quantify just how much impact PlayStation2 will have on e-commerce. All we can say is that it will likely be incredible,' said Katsuo Hori, an analyst at International Data Corp. ``For example, the market for digital content in Japan is said to be worth 20 trillion yen ($180 billion), and PlayStation2 is going to be the first point of use when that market moves online. And it's possible that most of that market will move online,' Hori said. AT THE FRONT LINES OF THE INTERNET REVOLUTION PlayStation2 is expected to sell nearly 100 million units worldwide over the next five years, 22 million of those in Japan. As an Internet platform, it will be easier to use and offer more functions than a cell phone, while at a retail price of 39,800 yen it will be much cheaper than a personal computer. And nearly every kid in Japan wants one. ``What's more persuasive for getting processing power into someone's house than a whiny nine-year old?,' said Thomas Rodes, Internet analyst at Nikko Salomon Smith Barney. ``I think it's the killer application. While we know that it's tough to expect a full-blown computer in every home, we already know there's a PlayStation in just about every home,' he said. With only 15 percent of Japanese households estimated to be logging regularly onto the Net, PlayStation2 is seen as bringing the as-yet Internet uninitiated -- kids and their mothers -- online. And it will be Sony's expertise in creating easy and fun graphics as well as the Sony brand name that will conquer these and other potential customers who would otherwise be too hesitant to purchase goods over the Internet, analysts say. But they also say that while many of the pieces of Sony's e-commerce puzzle are being assembled, it remains to be seen how quickly they fall in place. Conventional phone lines are too slow for distributing software online -- one song takes 17 minutes -- so Sony plans to use cable television broadband, which is still very limited in Japan, or possibly cellular phone networks if appropriate technology becomes available. Only 18 percent of Japanese households subscribe to cable television, and only one-third of those have enough line capacity for digital data distribution, analysts say. Sony content alone will not be enough to motivate customers to make the connection, they add. Coordination with other major companies in the music and movie industries would be needed to put together a content package of such proportions. Cable television companies in Japan are also numerous and cover relatively small bits of territory. Sony still needs to find a way to bring these disparate interests together, they say. mercurycenter.com