independent research firm Directions on Microsoft.
Such a trend would be ominous for Sony, whose executives are well aware of how ruthlessly Microsoft plays catch-up. Similar tactics helped Microsoft drive Internet pioneer Netscape out of business, and with Sony relying on the PS2 for most of its profits, the writing is on the wall for the iconic Japanese company.
Sony has said it hopes that its entry into the handheld gaming market might give birth to a new cash cow and is even touting its PSP, which it is displaying for the first time in Los Angeles, as the Walkman of the 21st century.
The comment refers to Sony's then-revolutionary portable cassette player of the late 1970s that epitomized the company's leadership of consumer electronics. But Sony has largely missed out so far on the latest wave of portables. From PDAs (personal digital assistants) to MP3 players and handheld games, the Japanese giant has been a digital also-ran. But with the ability to play movies, games and music, the PSP marks Sony's bold attempt to leapfrog the entire field.
Business 2.0 magazine has already dubbed the machine the iPod killer, predicting that it will mark the beginning of the end for Apple Computer's dominant MP3 player. But first it will have to beat a new device from Nintendo, which virtually owns the mobile game space with its Game Boy Advance and which plans to extend its dominance with the Game Boy Double Screen, which features two LCD screens and two microprocessors and promises to introduce a completely new style of gaming.
The market will have to wait until next year at least to see who wins these fascinating battles. But one thing is for sure: As always in the electronic entertainment industry, some of the most exciting contests will continue to take place behind the screens.
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