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Sony Vs. Lik-Sang & the Rest of the World
Article by muddasheep, October 24th 2006, 23:02:55
Lik-Sang.

For many people this name is a synonym for probably the most reliable way to get imported gaming goodness. Lik-Sang, a Hong Kong online distributor, has managed to build a stable community of clients and fans over the course of 8 years until now.

August 2005. Gamers in Japan, USA and South Korea already had the advantage of being able to obtain the latest handheld from Sony called Playstation Portable (PSP). Traditionally, European as well as Australian customers had to wait until September 1st for the PSP to appear in their local stores. Or - of course - they could just order it from facilities like Lik-Sang or buy it from local import stores like ElectricBirdLand.

However, Sony literally objected. After already being involved in law suits against local import stores, the japanese electronics giant sued Lik-Sang with the reason that Lik-Sang was violating trade mark, copyright and registered design rights by offering customers in the UK to purchase a PSP - before it was even officially released. Lik-Sang countered by citing Hong Kong's laws which state that "an item can be traded freely once it appears in a market anywhere in the world" - and continued selling PSPs to the UK.

October 2006 - Now. The High Court of London renders Lik-Sang's sales of PSP consoles unlawful. In other words, Sony wins. Lik-Sang has to pay all the legal costs for both sides which ends in a complete shut down of business. All customers awaiting orders are sent refunds.

A Sony spokesperson tells Gamesindustry.biz that "ultimately, we're trying to protect consumers from being sold hardware that does not conform to strict EU or UK consumer safety standards, due to voltage supply differences et cetera (...)". That said, while PSP UMD movies are region-encoded, PSP games are free of region codes and can be played on any PSP and it is the right of every customer to have the freedom of choice to import foreign games, or even import, for example, japanese UMD movies along with a japanese PSP.

Lik-Sang states that "all PSP consoles were in conformity with all EU and UK consumer safety regulations". Also, Lik-Sang points out that even a few directors of Sony Computer Entertainment Europe Ltd. have ordered PSP related products from Lik-Sang themselves. In return, Sony noted that the "purchasing of PSP consoles by SCE employees would be for investigatory purposes. We would also like to express our surprise at a company releasing personal information about its consumers, as this is contrary to data protection principles around the world."

Unfortunately, while it seems like the end of Lik-Sang, it is not yet the end of the restless giant Sony. The decision by the High Court London makes it possible for Sony to threaten any online retailer, such as Ebay and prevent them from sending Sony hardware into foreign countries. Not only that, it also sets a sign for other import stores not to mess with Sony when the Playstation 3 comes around. Nobody will want to fight Sony and sell PS3 hardware to foreign countries where it is not released yet (Europe gets the PS3 five months later than Japan and USA, in March 2007) when there is a high possibility of ending up like Lik-Sang.

But, why is Sony really sueing in the first place? Is it really just because of conformities and for the "protection of customers"?

Various rumors suggest that Sony is looking for every money they can get because of various reasons:

First, the PSP sells a lot less than expected, especially compared to Nintendo's DS, which is literally outselling the PSP (as of July, 1.3 million PSPs sold in Japan, compared to 1 million DS and around 4 million DS Lites).

Second, just recently several Sony notebook batteries caused high-profile fires at conferences and aboard a plane at the Los Angeles International Airport. Many laptop manufacturers, such as Apple, Dell, HP, Lenovo, Panasonic and Toshiba, whose laptops utilized Sony's batteries recalled millions of units. Sony confirmed that the affected battery cells had been sold between April 2004 to July 2006. Ultimately about 7 million laptops have been recalled (Dell alone had to recall 4.2 million units).

Third, on October 10th 2006 Sony ceased to market monitors due to poor sales.

Fourth, and probably the most important of all, Sony has suffered Blu-Ray diode shortages for its upcoming console behemoth, the Playstation 3. Due to this shortage the expected number of available units at launch has been seriously dropped to around 400,000 in North America and 100,000 in Japan, and Europe's PS3 launch date has been pushed back from November/December 2006 to March 2007 - after they had initially promised a world-wide launch at the same time. More importantly, the Playstation 3 should've already been released in spring 2006, but was delayed until November 2006 because of Digital Rights Management issues of the Blu-Ray format. Sony's stocks dropped by 2.75 percent in October due to confusion about the Playstation 3 launch and disappointing PSP sales.

Fifth, Sony will be selling Playstation 3 with a loss on every unit, even with a price tag of $599 for the Premium package and $499 for the Basic one. Most people are wondering if it will sell at all. Nevertheless, SCE president Ken Kutaragi said that the $599 price tag is "too cheap. (...) If you can have an amazing experience, we believe price is not a problem.".

Sixth, due to all the points above the press and internet blogs are literally tearing apart Sony. The internet is heating up and even previously loyal Sony fans around the globe are now promising to boycott the company and even tell their family and friends to stop buying Sony products overall.

Seventh, Microsoft vice president Peter Moore said that people "are going to buy two [machines]. They're going to buy an Xbox and they're going to buy a [Nintendo] Wii ... for the price of one PS3." A lot of people have gone to point out the same solution, even calling it "Wii60". According to a research 40% of all Xbox360 owners are thinking about buying Nintendo's Wii on its launch day. Since the Wii launches two days after the PS3's launch in the USA and Japan it is not hard to predict wether people will buy a PS3 for $599 (games for PS3 are estimated to cost between $59 and $99) or a Wii for $249. Especially not when there are so few PS3 units available in the first place.

But how much Sony is really "saving" by shutting down stores like Lik-Sang remains a mystery.

Although with certainty, they didn't save their reputation.
Sony Versus Lik-Sang.

DS Lite Versus PSP.

Wii Versus PS3.

Sony's Ken Kutaragi (left) Versus Microsoft's Peter Moore (right).

Links:
>Lik-Sang
>Sony PS3
>Nintendo Wii
>Xbox
How readers rate this Article: 9.83/10 (6 votes)
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