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18
page
Sony Corporation Annual Report 1999
MESSAGE FROM TOP MANAGEMENT
Ever since the first PlayStation game console went on sale in December
1994, Sony Computer Entertainment (SCE) has made a concerted effort to
grow rapidly in Japan, North America, and Europe. As a result, PlayStation
is now a widely popular game console in each of these regions.
In March 1999, SCE announced the basic design for its next generation
PlayStation game console, thus setting the stage for a new phase of progress
in the field of entertainment. The goal is to establish an entirely new
paradigm of computer entertainment. The new console will do this by serv-
ing the market for video games that was created by the current PlayStation
KEN KUTARAGI
President and
Chief Executive Officer
Sony Computer Entertainment Inc.
game console, while taking advantage of dramatic advances in graphics rendering capabilities.
For existing PlayStation game consoles, SCE plans to attract a wider spectrum of users by
continuing to develop new genres of software. Our intention is to leverage the resulting
expansion in the PlayStation format to lift video games to the same level of entertainment
popularity as music and movies.
THE PLAYSTATION FORMAT CONTINUES TO EXPAND
During the year under review, SCE retained its focus on further boosting the popularity of
PlayStation game consoles, particularly outside Japan. To further stimulate demand, SCE
reduced game console prices in North America and Europe in the summer of 1998 and in
Japan in January 1999. In concert with these actions, SCE raised monthly production
capacity of game consoles to 2.5 million units during the last three months of 1998 to
meet the global demand for this product.
By the end of March 1999, cumulative production shipments worldwide of PlayStation
game consoles reached 54.42 million units. Broken down by region, this figure was 15.26
million, 20.62 million, and 18.54 million in Japan, North America, and Europe, respec-
tively. During the year, substantial volume gains were recorded in North America and Europe,
but in Japan, the increasing saturation of the market for the current generation PlayStation
caused game console sales volume to drop below the level of the previous fiscal year.
REVIEW OF OPERATIONS
Game