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Headaches for PlayStation2
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March 10, 2000: 7:49 a.m. ET
Sony reports memory glitches for console; Microsoft enters game field
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NEW YORK (CNNfn) - Sony Corp. reported some problems Friday with its new PlayStation2 video game console -- on the same day that Microsoft Corp. announced it is developing a competitive product.
The Japanese electronics manufacturer said it received 340 complaints from customers about glitches with the game's memory cards. The game console debuted in Japan last weekend, and sold nearly a million of the machines in the first three days for about $370 a piece.
PlayStation accounted for about 40 percent of operating profits at Sony (SNE: Research, Estimates) last year, so the news of the problems will likely cause further concern for investors. Sony made the announcement of problems after the close of Japanese markets.
Even before the announcement, Sony shares fell 6.4 percent to 26,300 yen, or $246.90, in Friday trading in Tokyo. The shares have lost 22 percent of their value in the last seven days.
Part of the concern of Sony investors may be news that Microsoft Corp. (MSFT: Research, Estimates) would enter the $7 billion-a-year video game market at the annual Game Developers Conference in San Jose, Calif., on Friday.
The console is not expected to be available until late 2001. Like PlayStation2, it includes a DVD player, allowing customers to play movies or music compact discs when they're not playing video games.
The X-box also includes an 8 GB hard drive, boasts 64 MB of memory, and an Ethernet card rather than a modem. Company officials said they didn't want to lock the machine into a communication device that could become outdated in years to come.
In U.S. markets, Sony shares closed Thursday at 259-1/16, down 17-1/8. Microsoft ended at 100, up 4-7/16. 
- from staff and wire reports
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