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Surprise! PlayStation 2.5
Sony upgrades its console to become a home entertainment center.
May 28, 2003: 11:01 AM EDT

NEW YORK (CNN/Money) It's no longer just about the games - it's about movies and music too.

Sony threw the gaming industry its second curve ball in less than a month Wednesday, unveiling the PSX, an upgraded PlayStation 2 that takes the console far beyond its gaming roots. The revamped PS2 comes with a built-in DVD recorder, a TV tuner, a 120 GB hard drive and will let owners download movies and music from the Internet.

The machine will go on sale in Japan later this year and hit U.S. and European stores in early 2004. Sony did not give an expected price for the PSX.

Sony (SNE: Research, Estimates) had previously announced plans to begin selling a revamped PS2 in June, which would play re-writeable DVDs, come bundled with an online adaptor and run quieter than current models. Today's announcement is an entirely different machine, however.

"The PSX looks like a broad-functioned home network device that, in part, people speculated would be part of the PS3," said Stewart Halpern, managing director and analyst for RBC Capital Markets. "But they're announcing it as a separate product. I don't see this as the next generation of the game player."

Sony held back pertinent details about the PSX in its presentation, but the set-up of the device implies that in addition to playing all PlayStation and PS2 games, owners will also be able to record television shows to the hard drive (much like TiVo owners can now do) and burn copies of those shows to DVD.

Sony's new PSX  
Sony's new PSX

The PSX will come equipped with an Ethernet adaptor for high-speed internet service (though it appears the machine will not support dial-up access). It will also come equipped with a USB 2.0 port, allowing high speed data transfers, and will have a slot for Sony's memory stick data storage technology. And unlike the PS2, which has a disk loading tray like your computer's CD-ROM drive, the PSX will feature a sleeker slot-loading device, letting you simply slide your games, movies and more into the top of the machine. Functionally, this doesn't add much but it does add to the PSX's "cool factor".

The PSX announcement comes as the gaming industry has been speculating what Sony would offer with the PlayStation 3, whose features are expected to be unveiled next year. Most of that speculation has included some sort of home entertainment functionality. Analysts have questioned, though, how Sony might include those functions and keep the PS3's price at an acceptable level. Halpern said today's announcement could be a hint that the company views the PS3 solely as a gaming device.

Front and back views of the PSX  
Front and back views of the PSX

"This gives Sony a solution," he said. "This unifying home entertainment box is separate from the PS3, so it gives consumers the option to buy the PS3 as a dedicated game machine ... instead of forcing people to pay more for a device that has functionality they may not care about."

The PSX announcement is the second surprise from Sony this month. Two weeks ago, at the Electronic Entertainment Expo, the company stunned the crowd by announcing plans to enter the handheld portable gaming market, a field currently dominated by Nintendo's GameBoy. The PSP (PlayStation Portable) will go on sale late next year.

EXTENDED PLAY
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At its presentation Wednesday morning, Sony said it has received "strong support and interest" from both game developers and publishers and from film studios for the PSP.

The PlayStation 2 is the gaming industry's leading console, with some 52.5 million sold worldwide so far.  Top of page


Morris is Director of Content Development for CNN/Money. Click here to send him an email.




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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.