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TVTranscript
00:01Before it became a household name...
00:03Back then, it was just a no-go.
00:06The Sony execs were like,
00:07we are not a toy company,
00:09and we are not going to get into this business.
00:12Before it dominated the world of gaming...
00:14Sega had managed to capture 52% of the market
00:17in both Europe and the United States.
00:20It was only an underdog,
00:21thought up by a man with a vision.
00:23Ken is, I guess you could call him a genius.
00:27In the US, people were saying,
00:29can Sony deliver games?
00:33Could they really enter the hardware side?
00:35I remember having dinner
00:37with a vice president of Sony Records,
00:39and he told me,
00:41the PlayStation's never going to work.
00:43Sony's going to lose on this.
00:44Witness the birth, betrayal, and rebirth...
00:49...of the video game console that changed the world.
00:52Sony revolutionized the industry.
00:55It's that simple.
00:56This is the history of...
00:58The PlayStation.
01:05In the aftermath of World War II,
01:08a company named Sony helps the people of Japan
01:11rebuild from the ashes.
01:16Sony is a classic post-World War II success story in Japan.
01:25They started making cassette recording machines.
01:29They created a small cassette player that played back
01:32and recorded stuff after that,
01:34and that was the beginning of Sony Electronics.
01:37Innovative products such as the Walkman
01:39helped Sony become one of the most successful
01:41electronics companies in the world.
01:44Well, whenever people talk about Sony,
01:46a lot of people think about the Walkman.
01:48The Walkman was definitely Sony's first consumer product
01:51that really exploded.
01:55It was the portability of music,
01:57and everyone walked around with headphones.
01:59They really revolutionized the idea
02:01of portable music listening.
02:03As Sony gains more and more ground
02:06in the consumer electronics world,
02:08the video game industry grows by leaps and bounds.
02:12And by the early 1990s,
02:14the war for gamers' dollars is red hot.
02:17Sega and Nintendo are really dueling in the West.
02:22Sega had managed to capture 52% of the market
02:24in both Europe and the United States.
02:27Sega was more innovative at the time.
02:29They were always willing to take more chances.
02:31Sega was coming out with 70, 80 games of its own per year.
02:35The strategy at Nintendo was,
02:37let's hold on for the next Miyamoto game.
02:39Nintendo pays close attention
02:40when Sega unveils its latest technological advancement.
02:45So Sega came out with the Sega CD.
02:48All of a sudden, games were gonna be huge.
02:52They could be 600 megabytes of information.
02:55To meet the Sega CD thread,
02:57Nintendo turns to Sony.
02:59Nintendo wanted a partner, so they went to Sony,
03:02which, of course, was a huge, successful company.
03:05Sony may not have been a video game company, per se,
03:09but the Super NES used a Sony stereo chip for its sound.
03:14Sony was certainly, in its own way,
03:16a player in the video game industry in a small way.
03:19So it was a race.
03:21Nintendo knew that CD-ROM technology was the way to go.
03:24The original concept was a peripheral CD drive for the Super Nintendo
03:30that would be sold by Nintendo,
03:33and a combined unit, which would be called PlayStation,
03:36which was the console and the CD drive together,
03:39which would be sold by Sony.
03:41Sony brought in an engineer named Ken Kutaragi.
03:46Well, when you talk about the PlayStation,
03:48you just have to talk about Ken Kutaragi,
03:50who is considered the father of PlayStation.
03:52He came in to Sony in 1975.
03:56Right off the bat, he was considered to be kind of a brash engineer.
04:01He was very feisty and had a lot of ideas.
04:04He struck me immediately as a very forceful character.
04:10He had a clarity of thought and insight,
04:13which I think was, I still think to this day, is very rare.
04:17He clearly is a visionary.
04:19Very dynamic, very energetic, full of ideas, and very creative.
04:25He's known to be a fantastic engineer
04:28and a brilliant person on the engineering and technical side,
04:31but that's just the half of it.
04:33We met Ken Kutaragi once.
04:34It was not like we were looking at an executive who was buttoned up.
04:37We were looking at a guy who was in the trench,
04:40who was clearly an engineering mind and was resolving problems.
04:46He's an impressive mind, and he's achieved impressive things.
04:50The idea of working on a video game console is nothing new to Kutaragi.
04:54He was thinking about making a 3D game console a long, long time ago
04:59while people were tinkering away on 8-bit gaming.
05:02He approached Norio Olga, who was then president of Sony,
05:06and said that we should get into the video game industry.
05:09But back then, it was just a no-go.
05:11Olga and the Sony execs were like,
05:14we are not a toy company, and we are not going to get into this business.
05:18So that was that.
05:19But now, things are different.
05:21Hand in hand, Ken Kutaragi and the people at Nintendo team up to bring Sega to its knees.
05:27But Sony is about to face a bitter betrayal that will change the course of gaming history.
05:36As Sega prepares its new CD-ROM expansion for the Genesis,
05:41Nintendo and Sony work on a CD-ROM system of their own.
05:45But Nintendo begins to have second thoughts.
05:48The big reason why Nintendo kind of balked on the Sony technology idea
05:53was that they weren't going to have any rights to the CD technology.
05:58Sony was going to retain all the making of the CDs,
06:01they were going to manufacture it, distribute it,
06:03and that totally cut Nintendo out of the picture on definitely a large profit margin.
06:07And that made Nintendo very, very nervous.
06:11So, in the forefront, Nintendo's telling Sony everything's great.
06:16But behind the scenes, Nintendo went to Philips and said,
06:21why don't you start working on something for us?
06:24Nintendo's insecurities lead to a dramatic climax in 1991.
06:30CES comes around, and Ken Kutaragi and Sony come out,
06:34and they announce the Nintendo PlayStation,
06:36because they don't know anything's going on.
06:38Nintendo made a sudden announcement and said,
06:41well, we're going to work with Philips on the CD technology.
06:44That didn't go very well with Sony execs,
06:48and Ken Kutaragi was definitely very bummed.
06:50He went into Norio Oga's office and said,
06:54we just got backstabbed, blindsided by Nintendo.
06:57We had an agreement, and they totally betrayed us.
07:00Kutaragi went back to his bosses and said,
07:04let's not leave it like this.
07:06We can make an actual game system.
07:08We won't stop with the CD-ROM.
07:10We'll build the whole system.
07:11And Oga, who was totally dead set against it before,
07:15now feeling the betrayal from Nintendo
07:17and being the samurai corporate guy that he is,
07:21said, that's it.
07:23How many of his fists on the desk said two famous words?
07:26Do it.
07:26And that was the beginning of the Sony PlayStation.
07:30Now more driven than ever,
07:32Ken Kutaragi and Sony set out to make a video game console
07:36unlike any other.
07:38At first, Sony plans to release a system
07:40that plays both CD-ROMs and Super Nintendo cartridges.
07:44In 1992, 200 units of this PlayStation are manufactured
07:49but are quickly scrapped.
07:51Sony decides to wait for the next wave of consoles
07:54to enter the fray
07:55and intends to capitalize on CD-ROM technology.
07:59There was a big change taking place in terms of media.
08:03Game media like cartridges, CD-ROMs.
08:06This really changed the finances behind game development
08:10and game publishing.
08:11In October 1993, Sony announces that it's working
08:14on a new 32-bit game console.
08:17The name of this new system is the PlayStation X or ESX.
08:23The CPU for this console will be designed
08:26by Ken Kutaragi himself.
08:28On November 16th, the company officially forms
08:31Sony Computer Entertainment.
08:33We formed Sony Computer Entertainment, Inc.
08:36as a company, as a joint venture between Sony Corp
08:40and Sony Music Japan.
08:42This new department raises more than a few eyebrows.
08:45When PlayStation was being mentioned here in the US,
08:49people were saying,
08:50can Sony deliver games?
08:54Could they really enter the hardware side?
08:56To some people within Sony,
08:58PlayStation represented the future
09:00and was very exciting.
09:01But to other people, it was definitely a threat
09:04and something that they didn't fully understand.
09:07We had a lot of people that were pretty much skeptical
09:09about us getting into the business.
09:12Even before we came out,
09:14we were pretty much placed in the failure column
09:16because we were just newcomers.
09:18I remember having dinner
09:20with a vice president of Sony Records
09:23and he told me,
09:25the PlayStation's never gonna work.
09:27Sony's gonna lose on this.
09:29The irony for all of us was that
09:31as much credibility as Sony had as a brand,
09:35we had zero credibility
09:37as far as the world of games was concerned.
09:41Sony, I think, corporately was a little discouraged.
09:43How do we get into this new chartered area?
09:46Sony knows that the road ahead won't be easy,
09:50but Ken Kutaragi has an ace up his sleeve
09:52that will dazzle the entire game industry.
09:59As Sony Computer Entertainment goes full-bore
10:02into the development of the PlayStation,
10:04it becomes clear that this will be a console
10:06unlike any other.
10:09The biggest feature of PlayStation
10:11was going to be the real-time 3D graphics technology.
10:17At the time,
10:18the PlayStation was a faster console
10:23than anything out in the market.
10:25It could push more polygons.
10:27It gave developers a larger toolbox
10:30to work with
10:31than any of the competing consoles.
10:34And, of course, it used CD-ROMs.
10:36After watching the failure of systems
10:38like the 3DO very closely,
10:43Sony realizes that processing power alone
10:46isn't enough to come out on top
10:48in the world of video games.
10:50We looked at the business models
10:53of all of the companies
10:55that have been in the space
10:57or tried to get into space,
10:58and we asked ourselves,
11:00could we do this better?
11:01The biggest problem that we had
11:03was that the market in 1993
11:06was dominated by Sega and Nintendo.
11:09They pretty much had it sewn up between them.
11:11So any new entrant into the market
11:13had to do something pretty dramatic
11:15and pretty special.
11:16Sure, we had the system.
11:17Sure, we had the hardware.
11:18But it doesn't mean anything
11:19unless you have games.
11:21Nintendo already had Miyamoto,
11:22and he was a genius.
11:24Sega, they already had their arcade games.
11:27But Sony, what do they have?
11:29They don't have a genius developer
11:31or arcade games they're making,
11:32so they had to find software somewhere.
11:35We knew that in order to be successful,
11:37we had to capture the hearts and minds
11:38of the developers and the publishers equally.
11:41So what they did was
11:42they went on a very aggressive campaign
11:44to all the developers.
11:47If Sony had not brought hardware
11:49to the video game industry,
11:51I think the industry would be a lot smaller
11:53than it is right now.
11:54Enough to really differentiate this system
11:57and show that it was a 3D-based system
11:59and it really blew everybody away.
12:02But at first,
12:03a lot of developers were dead set against it,
12:05mainly because it was high technology.
12:07It was 3D.
12:08And a lot of game companies
12:10were still making 2D games.
12:11And they said,
12:11that's going to be so expensive
12:13to make 3D games.
12:14No way we can afford it
12:15and it's going to be very hard.
12:18Fight one!
12:19Ready?
12:20Go!
12:22One game that changed it
12:24and helped Sony ironically
12:25was Virtua Fighter.
12:27KO!
12:28Sega announced Virtua Fighter
12:30for the first time.
12:32And that completely opened up
12:34eyes of other publishers
12:36that showed that 3D graphics
12:39can be applied to other types of games.
12:42All of a sudden, it was a leap.
12:44KO!
12:44I couldn't keep up enough
12:46of the companies that were coming to us.
12:49They were asking us,
12:51can we do this?
12:53Is it possible to do this?
12:54Everybody wanted to work on the system.
12:56Sony does everything it can
12:58to round up third-party developers
13:00to support the PlayStation,
13:01and is able to sign 250 in Japan alone.
13:05The first task for me was managing the third-party department
13:12to recruit and help support third-parties like Namco.
13:17My target was to get as many publishers
13:21and many popular title franchises
13:23to become available on PlayStation.
13:26Sony also spends $48 million to purchase Cygnosis,
13:30the European developer behind Lemmings,
13:32and changes its name to Sony Interactive Entertainment.
13:35In December of 1994,
13:37Sony releases the PlayStation,
13:39now without an X, in Japan.
13:41The success in Japan was almost instantaneous.
13:46Another three months to get to the million mark in Japan.
13:50And I remember the then-chairman of Nintendo
13:53saying that if we ever got to a million units,
13:55he would resign,
13:56because he clearly knew nothing about the games business.
13:58It took him a few more years to actually get around to it,
14:01but I thought it was a great statement.
14:03The next step is ensuring a successful launch
14:05in the U.S. and Europe.
14:11To pull this off, Sony spares no expense.
14:14The Japanese giant spends a rumored $4 million
14:17for a booth at E3 in 1995.
14:20Sony also kicks off a huge marketing blitz
14:23to raise awareness for the PlayStation.
14:26The marketing strategy was very clearly defined
14:30from the beginning,
14:30that we needed to appeal to an older,
14:33more sophisticated audience.
14:35We also had a very smart bunch of people
14:37in our marketing department
14:38who recognized that everybody really wants to be 19.
14:42If you're 12, you want to be 19.
14:45If you're 25, you really want to be 19 again.
14:47And so what they did was they targeted 19
14:49as the communication tone of voice.
14:52Another thing that I think was really key
14:55to establishing that credibility for us
14:57was the idea that gamers wanted to work a bit harder
15:01at deciphering messages, you know, teasing a date like 99, 95,
15:05playing with Enos, which was essentially Sony spelt backwards.
15:10Sony was saying games are a lifestyle
15:13and we're going to promote and work it
15:16from a lifestyle perspective.
15:18We very deliberately stayed away from making Sony
15:22a big part of the communications message.
15:25The initial tagline of you are not ready
15:28was the first big step that we took in saying,
15:30this is not your parents' Sony brand.
15:34With this new mindset,
15:36Sony sets out to conquer the United States.
15:40After a nationwide marketing blitz unlike any other.
15:46Sony launches the PlayStation in the United States
15:49on September 9th, 1995.
15:53The first day, September 9th,
15:55I felt really like, oh, we did it.
15:59But it was not really a huge amount of numbers
16:02in the first year.
16:03It's like only 800,000 units.
16:07The initial launch of the PlayStation
16:09was a real happy day for me.
16:12It just was overwhelming.
16:15For a relatively unknown company,
16:18at least in the video game business,
16:20to get that kind of enthusiasm from day one.
16:24The original PlayStation, I think,
16:25really touched a nerve.
16:27I think part of that was down to the product itself.
16:32It's a great hardware device
16:33and they lined up some great software.
16:34And I'd like to think we did some nice marketing to it.
16:37The controller of the PlayStation,
16:38like, it's just, it's unbelievable.
16:40It's just perfect.
16:42The PlayStation picks up more and more sales
16:44thanks to powerful hardware
16:46and a collection of exclusive games and other hits.
16:51We had Ridge Racer as a driving game.
16:53Okay, the final lap! Hang in there!
16:57So we had a driving game
16:58and then I wanted a fighting game.
17:00So when I, I went out and hunted for that,
17:03about Toshinden.
17:06If you look at the sexiness and the appeal
17:08of what Toshinden was about as a fighting game,
17:10it was fabulous.
17:11It was a major, major hit.
17:13Oh, ah!
17:14Ah!
17:15Ah!
17:15In 1996, we came out and launched Crash Bandicoot.
17:19Crash Bandicoot was a terrific launch title.
17:24Define PlayStation as a platform.
17:27And it was about a year or so
17:31after the launch of PlayStation.
17:33One of the executives at Squaresoft
17:36said he's gonna make Final Fantasy on PlayStation.
17:45At that point, I felt that all the ties will change.
17:50The PlayStation proves to be a juggernaut
17:53that plows through all competition.
17:56The Saturn launched before PlayStation in 1995,
18:02which was the wrong time to launch.
18:04Also, a very expensive price point.
18:07I believe it launched at $399 versus $399.
18:12The PlayStation launched.
18:13It did not have very good games.
18:17But it was around Thanksgiving
18:19and going into the holiday of 1995,
18:23where we started getting reports
18:26that the retailers were just not going to have enough PlayStation units
18:31to last them through the holiday selling season.
18:34It really turned into a feeding frenzy.
18:38The success of the PlayStation goes beyond even Sony's expectations.
18:43Let's go! Let's go! Let's go! Let's go!
18:47We kind of like brought the PS1 era to a close.
18:50You can still walk into Toys R Us and buy PS1 games.
18:53The PlayStation has changed the world of gaming as we know it.
18:58If Sony had not brought hardware to the video game industry,
19:02I think the industry would be a lot smaller than it is right now.
19:05Before the original PlayStation came out,
19:07the media perception of the video game business was that it's basically a toy for kids.
19:15But we saw the PlayStation as not really a platform of entertainment for kids,
19:22but really an interactive entertainment platform for everybody.
19:26Sony revolutionized the industry of the PlayStation and keeps that simple.
19:31They started off as an underdog and in 10 years have managed to own over half the market.
19:38And that's just incredible.
19:40There are now over 35 million PlayStation 1 machines in the US and Canada combined,
19:47which puts us at an unbelievable household penetration rate compared to other game systems.
19:54And I think for many consumers, PlayStation equaled gaming.
19:59Today, Sony remains number one.
20:02The PlayStation successor, the PlayStation 2, has shipped more than 90 million units worldwide
20:07and is still going strong.
20:09Sony is moving into the portable gaming market with the PSP,
20:13while the next generation PlayStation 3 is just around the corner.
20:17Ladies and gentlemen, please give a warm welcome to the father of the PlayStation, Ken Kutaragi.
20:24And the man that started it all is still at the helm, ready for the next challenge.
20:30And now, I have the final and the biggest announcement.
20:36Ken Kutaragi is a man who has like years in advance plotted out in his head
20:40and has an amazing vision of where he wants video games to go.
20:45Ken is really the father of the PlayStation.
20:47He always believed PlayStation would be number one.
20:50You know what? I have to applaud him.
20:52He's right.
20:53He's right.
20:54He's right.
20:56He's right.
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