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August 21, 2013

Sony PS4 - The Latest Cable Rival?
By Joyce Wang

Who said the upcoming Sony PlayStation 4 was just another gaming console? Reports that Sony has inked a tentative agreement with Viacom to stream cable channels, potentially over the PS4, has tongues wagging as the company reportedly pursues similar deals with Time Warner and Disney. The PS4 is expected to be available later this year. Will PS4 be Sony's version of Microsoft's all-in-one entertainment console Xbox 1? Maybe. But a Sony rep, who declined to address the reports, said PS4's main focus remains the more than 1bln global gamers.

The company also highlighted advanced gaming features when it announced the device earlier this year, boasting a custom chip that enables high-fidelity graphics, as well as a connected and immersive gaming experience. In addition, the Sony rep said other OTT services such as Netflix and Amazon remain "very important to the PlayStation ecosystem," as do other "integral" connected devices.

The new PlayStation app offers 2nd screen functionality across mobile phones and tablets, and Sony's own PlayStation Vita lets gamers extend PS4 titles to a 2nd gaming screen via WiFi. Assuming rumors of deals with programmers come to fruition, PS4 could of course double as a streaming device for premium content. S&P analysts said the "advent of competitive online video services, heralded by mostly library-focused offerings from Netflix, Amazon and others" represent another watershed moment for an emerging pay-TV market.

Meanwhile, Moffett Research said these kind of OTT deals also highlight the "real race" toward usage-based broadband pricing for cable operators, who after all own all of those wires. But even as some cable ops move toward tiered pricing, Moffett said the industry remains split on the issue and still has a long way to go before it becomes common practice. The lack of unanimity might be in part due to John Malone's ambition in consolidation. "What the industry really needs, Malone seems to be saying, is leadership," especially on tier pricing model, it said. Will pay-TV providers get the last laugh? Perhaps Dr John has the answer...

EDITOR'S NOTE: This story originally appeared in CableFAX Daily. Go here to subscribe.

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