Sony’s $399 PlayStation VR Significantly Cheaper than Competitors

Sony Corp (NYSE: SNE) launched its PlayStation VR headset that costs $399, cheaper than its competitors in the market.  According to the Japanese company, the device will be available in Japan and other countries in Asia, Europe, and North America in October.

Investors expressed optimism with the PlayStation VR because its price is significantly lower than the Oculus Rift headset from Facebook (NASDAQ:FB) and HTC Vive headset from HTC Corp (TPE:2498), which costs $599 and $799, respectively.

The stock price of Sony increased 4% to $25.50 per share in New York and 3.19% to ¥2,883 per share in Tokyo on Wednesday, March 16

                                                                       “Tremendous response”

Source: Sony Computer Entertainment
Source: Sony Computer Entertainment

According to Andrew House, the President and Global CEO of Sony Computer Entertainment (SCE), the PlayStation VR received “tremendous response” from gamers and developers since the company showed it during the Games Developers Conference in 2014.

He added that the company decided to start selling the virtual-reality headset in the market in October to make sure that it has enough units and a wide variety of games available for consumers globally.

Currently, there are more than 230 developers and publishers creating games for the PlayStation VR Software. Sony said there more than 160 diverse games in development for the virtual-reality headset.

The PlayStation VR will have more than 50 games available for consumers by the end of the year including Eagle Flight, EVE: Valkyrie, Headmaster and Robinson: The Journey Wayward Sky and others.

Consumers need a PlayStation 4 console, a camera sold separately (costs between $44 and $59) and special controllers (DualShock or PlayStation Move) to be able to use the PlayStation VR headset, which comes with a processor unit, ear buds, HDMI cable, USB cable, AC adapter, power cord and a headset connection adapter.

PlayStation VR Image

Analysts’ comments on the PlayStation VR

Joost van Dreunen, an analyst at SuperData Research, commented, “I like the price point, but it doesn’t include all the necessary components, like the camera [and controller]. So I expect Sony to announce a bundled version that provides consumers with everything they need.”

On the other hand, Gartner analyst Bria Blau noted that the price of the PlayStation VR was “certainly a lot lower than competitors” and “a great holiday gift” compared with the other virtual-reality headsets that require users to have a $1500 personal computer (PC).

“Sony came in exactly where it was expected. They will do [well] with the 36 million fans that already own the PlayStation 4,” added Blau.

HIS analyst Piers Harding-Rolls estimated that Sony could sell as much as 1.6 million units of PlayStation VR by the end of 2016, which would serve as a foundation for its dominance in the high-end VR headset market.

Meanwhile, Damiang Thong, an analyst Macquarie Group, said, “It’s a really compelling price that aims for mainstream market share, and this is key for VR platform success. Sony probably thinks of PlayStation VR as a broader ecosystem push, something that not only will sell more PS4s but will also encourage users to upgrade to PS5 in the future.”

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