

How Sony inadvertently helped a competitor and lost position in the videogame market - sachinag
http://online.wsj.com/article/SB123069467545545011.html

======
patio11
I know media loves to cover all contests as a horserace, whether it be
presidential politics or business rivalry, but this is less a story of What
Sony Did Wrong than What The Competitor Did Stunningly, Amazingly,
Breathtakingly Right. Same with Sony's entry into the portable MP3 player
market -- don't know the name off the top of my head but they've had one for a
decade, right? -- which is now The iPod Market because Apple has designed and
marketed one of the most iconic products of my generation.

Its not that the Sony entrant -- whatever it was -- was flawed. Its just that
Apple just totally ran away with the game.

[And when my mother, who is 56 and had a stroke three years ago such that
until recently she could barely move without assistance, mentions that the Wii
is her favorite Christmas gift ever, you KNOW Nintendo did something right.]

------
spolsky
I love outsourcing disaster stories. Business strategy 101: never outsource
the functions that give you competitive advantage.
<http://www.joelonsoftware.com/articles/fog0000000007.html>

~~~
robg
But you can outsource in a strategic way, right? Like McDonalds, and KFC, with
their seasonings - no one vendor knows all the ingredients or their
quantities. Didn't Apple take a similar path with the iPod and then the
iPhone? They rolled one critical aspect of the product themselves - the
software - but the competitive advantage of the hardware was strategically
outsourced.

~~~
cstejerean
the competitive advantage of the apple hardware lies in the design, not the
actual manufacturing of it.

~~~
robg
Sure, but if it was as simple as ordering parts from vendors couldn't anyone
reconstruct either product on the hardware side?

~~~
orib
They can and do, for the most part. iPhone knockoffs are a dime a dozen, for
the most part, although Apple has design patents to keep them from looking too
close to they original.

------
taylan
One line summary/spoiler: "Technical supremacy divorced from sound strategic
vision is no virtue, it can even end up in disaster."

~~~
ntoshev
Wii innovated and became better in an area that happened to matter more:
player interaction with the console. I don't think it was obvious in foresight
that this was so important.

~~~
robg
Exactly. That last line was the most glaring with the whole article because it
was the Nintendo GUI that gave them their current standing. Their "vision"
emerged from their greatest weakness - the inability to compete with the
biggest boys in playing the same game. So instead they changed the rules by
innovating. They must have known they were aiming for a different slice of the
market but without appreciating how big it could be.

------
potatolicious
Does anyone have any concrete info on what similarities the Cell and Xbox 360
CPU share, besides the fact that they're both by IBM?

I was under the impression that the 360 CPU is based on the old PowerPC
designs that IBM already had in-house, and is a far more traditional CPU
(albeit with 3 cores) than the Cell.

~~~
sachinag
The Wii/GameCube one definitely is based on the PowerPC designs - I hadn't
heard that about the 360 chip. Lo and behold, you're right:
[http://www.ibm.com/developerworks/power/library/pa-
fpfxbox/?...](http://www.ibm.com/developerworks/power/library/pa-
fpfxbox/?ca=dgr-lnxw961XBoxDesign)

------
paul9290
Great read, but amongst all the drama they both lost!

Now off to play some FUN Mario Kart!

