SCEA on PSP Minis, UMD Conversion, And Amazon

psp-go-storeIntroduction of the PSP family’s newest member went off with hardly a hitch, setting in motion new PlayStation Network services and content poised to highlight the portable entertainment value inherent to Sony’s digital-download-oriented PSP Go. However, in spite of the excitement surrounding the recent influx of full PSP titles and Minis available for download and the debut of Amazon’s PlayStation Network Store, many questions remain regarding Sony’s pricing strategy, the noticeably absent solution to UMD conversion, and what Amazon’s involvement means for the future of the PlayStation Network.

In a recent interview with Joystiq, Eric Lempel, SCEA’s Director of PlayStation Network Operations, was kind enough to shed some light on the pricing mechanism currently set in place for Minis and whether such prices correctly reflect their value as opposed to any other non-Minis title.

“There are a couple of rules, or maybe there’s just one rule. Minis have to come in at $9.99 or under….As far as pricing goes, the publisher of the title sets the pricing. So, they give us the price and then we have a standard markup…it’s really on them to get on and compete and do what they can to get their titles sell and make them successful…If it’s not priced correctly, consumers may be turned off at the proposition and say, “I’d rather just go for this kind of stuff instead of minis.”

When asked why the much anticipated UMD conversion service that was first teased by Sony in the weeks after the PSP Go was announced was then scrapped soon after, Eric Lempel explained,

“It’s a combination of what’s technically possible, but a bigger part of that is the rights to the content that’s been available. PSP has been out for many years now. There weren’t digital rights secured for all of this stuff, at no cost. So, there’s lots of legal issues we’d have to get through to get a lot of content cleared. And also, we’d have to protect that content. So, with a good technical process so you can’t pass around the UMD or do something else with it. So, it’s a combination of things. It’s something we’ll continue to look at, but for the time being, it’s just where it is.”

On the subject of SCEA’s newly formed partnership with online retailer, Amazon, Eric Lempel revealed details regarding the exclusive terms of the deal as well as how prices are controlled, stating:

“…we’re definitely open to exploring other retailers in the channel. There’s nothing exclusive about this. If it makes sense, and works for both sides, yeah, we’d definitely be open to exploring this with other retail partners…Pricing will be separate. Amazon is on their own as a retailer, so they can set their own pricing.”

We believe the last bit of information regarding the Amazon partnership to be very important, not only because we’re excited at the prospect of Amazon shaving a few bucks off the price of games, but because it’s a promising foreshadow of a digital download utopia. By allowing Amazon and other potential online retailers to control their own prices, in addition to an increase in competitiveness, digital download monopolization becomes less of an issue. As a result, the PlayStation Network is transformed from being the only seller of digital titles to another competitive retailer trying to persuade us into parting with our hard earned legal tender.

Sure, one could argue that this type of competitive digital download marketplace is purely wishful thinking considering countless retailers already offer the same games without much price variance. While that may be true, it’s no secret that Sony wants digital downloads to work while retailers want to maintain their piece of the pie. This type of partnership provides a perfect solution which gives both camps a reason to smile while offering them a chance to make us consumers truly happy. However, at the end of the day, we can’t help but remain cautiously optimistic.