PSP World

Will Consumers Rush to the PSP Go?

With news and detailed specifications for the PSP Go emerging over the weekend, we now have a much clearer picture of what Sony has planned for its handheld hardware range. The PSP Go, due to be introduced this fall, will differ from previous models by including 16GB of on-board flash memory while dispatching with the UMD drive in favor of digital-only purchases. The standard UMD-equipped model will remain on shelves indefinitely as Sony gauges public interest in this new business model. But will this gamble pay off for Sony, and will consumers embrace the new PSP hardware?

Early public reactions to the new PSP design were mixed. Some gamers who had been waiting for a more complete break from the first-generation PSP were disappointed that the PSP Go lacks a second analog stick or a touch screen. The core hardware such as graphics processor, screen resolution and motherboard, remain unchanged. What the PSP Go actually offers, then, is a new way of purchasing and playing games - the same games that will be available on existing models of the PSP hardware either on UMD or via the Playstation Store.

The smaller size of the PSP Go has also drawn several different complaints. The horizontally-oriented screen still takes up a large proportion of the face of the device, but it has been scaled back to a slightly smaller 3.8" size. This sacrifice to portability could be a negative point to some, who appreciated the extra-large screen on the original PSP. Some commenters are also skeptical about the placement of the slide-out controls, and the analog nub in particular. It seems to be located too close to the center of the device, and might make controlling certain games difficult. However, these are probably minor quibbles that will be settled once we finally get our hands on the device.

The PSP Go in the open position, showing layout of controls.

Another potential barrier to consumer adoption is the expected high price of the handheld. During the leaked Qore video segment, the Sony spokesman said that this hardware revision is intended to be a "premium" product, indicating that it will be more expensive than the current PSP 3000, priced at $169.99 USD. Although the cost of flash memory has come down dramatically in recent years, the inclusion of 16GB of storage memory will definitely impact the retail price of the PSP Go. It is estimated that the on-board storage will initially add a $70-80 premium to the price of the PSP Go, placing it around $239 at retail. Considering existing options like the competing Nintendo DSi and even the older model PSP, Sony could face a difficult challenge convincing first-time buyers that the Go represents the greatest bargain.

Financial analysis firm Sterne Agee echoes our concerns: the current model PSP is already too expensive for many consumers, and in need of a price cut. Introducing a new, more expensive model might appeal to hardcore gamers, but will fail to win wide market acceptance above $200.

Several years ago, the introduction of a new tech gadget, not matter what the price, was met with throngs of early-adopters ready to form a queue to part with their money. Now, with the economic recession firmly hitting home in households across Europe and North America, those heady days are temporarily behind us. At a time when consumers are trying to rein in their spending, releasing a premium version of a product they already own may not be the wisest business move.