Sony challenges channel players with online games store

Games giant Sony has set up an Internet store to sell and market its video games online.

Games giant Sony has set up an Internet store to sell and market its video games online.

Playstation.com, the electronics company's ebusiness arm, was launched in Japan last week.

In a move which could eventually be repeated in Europe and worldwide, the vendor will challenge its established dealer channel and use the Internet as a direct weapon in the increasingly volatile video games business.

Jeremy Davies, senior partner at market research company Context, said Sony's announcement was not a surprise. Davies claimed that selling games online is "the way to go" and that, in the long term, no reseller will be able to sustain a business by selling games alone.

"In the short term, for dealers in this country it will be alright because of the Internet's slow penetration in the UK," he said.

"However, others will follow Sony, and as Web connections speed up, dealers will have to look at changing their business models. The traditional dealer's role of just selling games is definitely coming to an end."

At present, Playstation.com offers customers only Playstation games and hardware, but the online store will also eventually offer customers Sony CDs and DVDs.

Playstation.com is expected to benefit from the strong Sony brand name and from the debut of Internet-enabled Playstation 2, early next month.

The ecommerce unit, under Sony's wholly-owned subsidiary Sony Computer Entertainment, has been set up in conjunction with 11 companies, including software vendors and convenience store company 7-Eleven Japan. The 11 firms will have a combined 20 per cent stake in the ecommerce division.