PlayStation2 could drive DVD market The software industry is expanding sales space and distribution systems for digital-versatile-disc (DVD) software under the key words of "March 4, 2000." That is the day when Sony Computer Entertainment Inc. has set for the release of the long-awaited PlayStation2 128-bit video-game console. "We will continue to stress DVDs next year. We are hoping PlayStation2 will be the engine to drive market growth," said President Muneaki Masuda of Culture Convenience Club Co., the operator of the Tsutaya audiovisual software rental/sales chain nationwide. The company is preparing to display 2,500 DVDs for rental and 3,000 titles for sale at its new outlet in the western Tokyo shopping district of Shibuya. The store will open Dec. 17. Both figures will be the largest in the industry, company officials said. PlayStation2 will be equipped with a function to play DVD video discs. With its suggested retail price at 39,800 yen, the game machine is cheaper than DVD players currently on the market. Sony Computer Entertainment President Ken Kutaragi said in September, "We plan to ship 1 million units in two days from release on March 4." The debut of PlayStation2 will also likely push down the prices of existing DVD players. "Some models will likely be sold for less than 30,000 yen," said an official at a discount store in Tokyo's Akihabara electronics retailing district. While DVDs have a larger storage capacity than CD-ROMs (compact-disc read-only memories), and boast excellent image and sound, the format has not achieved popularity smoothly due in part to high prices for DVD players and a lack of popular software in the beginning. Cumulative domestic shipments of DVD players are projected to stand at some 950,000 units through the end of 1999, according to the Electronic Industries Association of Japan. Toshiba EMI Ltd., despite being a Sony rival in the music business, is also pinning its hopes on PlayStation2. It will release a DVD title by the phenomenally popular musician Hikaru Utada on Dec. 22, adding DVD titles by other pop artists after that. There is a possibility that shipments of DVD software will grow sharply on the effect of PlayStation2 and the introduction of popular titles. Sony Music Entertainment (Japan) Inc., the parent of Sony Computer Entertainment, which has turned out CD-ROMs for the subsidiary's game software on a commission basis, plans to boost the production lines at its pressing plants. It will also enhance the authoring system at a new studio to be set up in Tokyo's Minato Ward. However, game companies that supply game software to PlayStation2 are not exactly welcoming all the DVD enthusiasm. "The different forms of entertainment are all in competition for the limited time of consumers. If images and music-software sales are brisk, that will cut into the game market," cautioned the president of a major game maker. Sony Computer Entertainment seems to have wavered to the last minute in its decision on whether to include DVD-video replay function on PlayStation2, in consideration of concerns voiced by game companies. But it finally judged that both markets will grow, if the shipment volume of PlayStation2 expands for use either as a DVD player or as a game console. The question is whether the company can get 1 million units out to store shelves by March 4. No audiovisual equipment of a single brand has ever enjoyed such a spectacular debut. Even sales of Microsoft Corp.'s Windows 95 stood at 200,000 copies in the first four days. Matsushita Electric Industrial Co., meanwhile, said it will delay the debut of its audio DVD player due to public knowledge of a video DVD piracy method now available for downloading from the Internet. There is no guarantee that a similar unexpected situation will not derail the PlayStation2 express train. If the DVD market finally does ignite with games as the breakthrough product, demand not only for software but also for players as well is sure to explode.