Sony Eye Toy

Importance of the Eye Toy product for Sony

The Eye Toy was a revolutionary product because the underlying

technology to interpret incoming video signals was clearly the first in the market.

The case indicates that the Eye Toy Play appealed to a broad audience both in

terms of demographics as well as gaming experience. Based on the consolidated

income statements for Sony Corporation in Exhibit 2 of (Harvard Case 9-505-024

page 13) the game business segment accounted for 61.5% and 60.7% of operating

income in 2002 and 2003 respectively which was second only to electronics from

2001 to 2003 in total sales and operating revenue, and so the Eye Toy is

strategically important to Sony.

Role of the Eye Toy play within Sony Computer Entertainment Europe's strategic objectives

Sony Computer Entertainment Europe strategic objectives involve

developing games different from other third party game developers and they strive to

be the first or the best in developing games("..Be first to market with a new genre,

create something special like Eye Toy, or be the best in an existing category like

the Getaway"). The product development pipeline for Eye Toy included new games

produced by SCEE ("Eye Toy required" games requiring use of the Eye Toy) as well

as games produced by third-party developers ("Eye Toy enhanced" games not

requiring its use but promising an enhanced game experience if used).

Reasons for the success of Eye Toy Play and failure of the groove

From a strategic viewpoint, the Eye Toy was innovative and different from

the competition. The Eye Toy play was successful for a variety of reasons

in the game industry when it was launched. It was unique as it invoked a lot of

interest from gamers as well as non gamers and had broad demographic appeal

because of the hardware (the Eye Toy camera) even though some of the more

abstract games had been confusing. It was also easy to use with its USB plug and

play feature which did not require a user's manual.

Another critical aspect of the marketing campaign's success was allowing

the users to sample the product beforehand in a variety of locations such as

shopping centers, bars and beaches and in such a way so as to demonstrate the

game's technical performance coupled with promotional materials and TV

advertising.

One critical reason for the failure of Eye Toy groove was that it was not as

original (it was based on a popular Eye Toy play mini game called Beat Freak),

sold as a game (software only) for Ђ 39.99 (this was relatively expensive when

compared to the Eye Toy Play which included the camera and 12 mini games)

this forces a potential buyer to have both the Eye Toy camera and Playstation2,

and even though Hardy claimed it was a dance mat type product with licensed

music, the buyer impression was that it was game music. Also as stated in page 5

of the case the most popular console games were Action (27%), sports (18%),

racing (16%), role playing (9%) and fighting (7%). There is no mention of dance

music or entertainment. It is also not clear what demographic segment was

targeted. To summarize, what worked well at one time may