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PlayStation 3 likely missed sales target

Sony's long-awaited PlayStation 3 may have missed its global shipment target and been beaten in its home market by rival Nintendo's surprise hit Wii video game system, new figures show.
(FILES) This photo taken 11 November, 20
According to a market survey released by Japanese computer game publisher Enterbrain Inc., Sony's PlayStation 3 may have missed its global shipment target and been beaten in its home market by rival Nintendo's Wii video game system.Yoshikazu Tsuno / AFP - Getty Images file
/ Source: The Associated Press

Sony's long-awaited PlayStation 3 may have missed its global shipment target and been beaten in its home market by rival Nintendo's surprise hit Wii video game system, new figures show.

The results herald more bad news for Sony Corp., which is struggling to maintain its dominance in video gaming amid a three-way battle with Nintendo and Microsoft Corp.'s Xbox 360.

Sony sold 466,716 PlayStation 3 units in Japan from its Nov. 11 domestic launch date to the end of December, according to a market survey released Tuesday by Japanese computer game publisher Enterbrain Inc. The figures fall short of the 1 million consoles Sony predicted it would ship domestically by year's end.

Earlier this week, Sony said it met its shipping target of 1 million PS3s in the United States in 2006. But the combined U.S. and Japan total puts the company well below its global shipping goal of 2 million.

Tokyo-based Sony is banking on the PS3 to spark a turnaround from tumbling profits and a costly worldwide recall of 9.3 million laptop computer batteries. Lackluster PlayStation sales would be further cause for concern for a highly hyped product launch already off to a rocky start with two delays.

News of a possible shortfall in Japan helped send Sony shares plummeting as much as 2.7 percent Wednesday on the Tokyo Stock Exchange. The stock ended 1.8 percent lower at 5,450 yen ($45.79) amid an overall decline in the market.

Eating into Sony's sales at home was the unexpected success of Nintendo's Wii gaming system, according to Enterbrain. Nintendo sold 989,118 Wiis domestically from its Dec. 2 launch date to month's end, nearly double Sony's total.

In contrast to the PS3's focus on super-realistic graphics and high speed action, Nintendo's Wii turned to a revolutionary motion-sensitive wand controller hoping to lure a wider crowd of players — not just young men. The wand can be swung like a tennis racket, golf club or sword, depending on the game, and became an instant hit for its innovative approach.

Nintendo gets boost from portable machine
Meanwhile, Nintendo Co. raised its group profit outlook by 20 percent Wednesday for this fiscal year because of upbeat sales worldwide of its portable game player Nintendo DS.

The company raised its profit forecast to 120 billion yen ($1 billion) for the fiscal year ending in March from an earlier estimate of 100 billion yen. The Kyoto-based video game manufacturer said it now expected sales of 900 billion yen ($7.54 billion) for the year, up from a previously forecast 740 billion yen.

Nintendo attributed the upward earnings revision to brisk sales of its Nintendo DS — short for "dual screen." For this fiscal year, the company raised it sales outlook for two models of the hand-held game machine, Nintendo DS and Nintendo DS Lite, to 23 million units from 20 million units.

Japanese game software and console maker Nintendo Co. Ltd. displays the company's next-generation game console \"Wii\" (L) and it's control unit before their corporate strategy meeting in Tokyo June 7, 2006. Nintendo plans to release the new game console in the last quater of 2006, which price would be 25,000 yen or lower in Japan and $250 or lower in the United States. REUTERS/Issei Kato (JAPAN)Issei Kato / X90003

With regard to its Wii gaming system, Nintendo on Wednesday left unchanged its projection of selling 6 million Wii consoles by the end of March, but raised its Wii software sales forecast to 21 million units from 17 million.

The solid performance prompted the company to boost its dividend payment to 480 yen ($4.02) per share for this fiscal year, up from 390 yen ($3.27) a year earlier and higher than a previously planned dividend of 400 yen ($3.35).

However, the company expects to spend over 1 billion yen ($8.4 million) to replace defective adaptors on some DS units, as well as the straps of the wandlike Wii controllers, according to Kyodo News agency. Nintendo has warned that some DS adaptors may overheat, while there have been widespread reports of controllers flying out of the hands of overly energetic Wii players.

Discrepancy in shipment figures
Sony has not yet released Japan shipment figures for the PS3. But the company is tallying results and will release them "soon," said Nanako Kato, a spokeswoman for Sony Computer Entertainment Inc.

Kato couldn't comment on the Enterbrain figures, but said there may end up being a discrepancy between the domestic sales, which were estimated by Enterbrain, and the actual shipment number.

"We don't know the details of the survey, so we can't comment," Kato said.

Both Sony and Nintendo are projecting selling 6 million consoles by the end of March. Sony expects to start shipping the PS3 to Europe sometime that month as well.

Straggling far behind Sony and Nintendo in the Enterbrain survey was Microsoft's Xbox 360, which had sold 290,467 since its Japan debut in December 2005.

Selling machines in large numbers is crucial in the gaming business because it encourages software companies to make more games to play on the machines, which in turn boosts console sales.

Sony controlled the previous generation of video game consoles with 70 percent of the global market, including 35 million PlayStation 2 consoles in the United States. The original Xbox was second with nearly 15 million sold, followed by 11 million Nintendo GameCubes.