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A gamer plays a video game on the PlayStation 4 at the Sony PlayStation E3 media briefing in Los Angeles, Monday, June 10, 2013. Sony is giving gamers their first look at the PlayStation 4 and it's a rectangular black box, just like all the previous PlayStations.Jae C. Hong/The Associated Press

Nintendo may have technically started the eighth-generation video game console war last year with the release of the Wii U, but it's Sony that is kicking it into high gear with the launch of the PlayStation 4 on Friday. Next week, the battle is fully joined with Microsoft's release of the Xbox One.

Shuhei Yoshida, president of Sony Computer Entertainment's Worldwide Studios (the game software side of Sony), sat down on Monday to discuss the latest round of this ongoing epic battle – how the PS4 maker is positioned heading into it, how its competitors are looking and what the future of gaming might look like. (The following interview has been edited and condensed.)

How are things looking going into launch week?

I'm from the developer side so as far as we are concerned, we [have] finished our launch titles. They went through their certifications a couple of weeks ago so we've been kind of waiting for the other parts of the PlayStation to get prepared for the launch. The hardware guys finished even earlier, many months before us. There are other parts of development in Sony, like the system software and network services, and they're working until the last minute so that we can provide the best features. We've been waiting till this week to do that.

There are so many people [who are going to be] jumping on to our servers that something may happen. Our team is ready and on call to fix any issues. It should be a great launch.

In terms of the business side, we've had record-breaking pre-orders for the PS4 compared to any [previous] PlayStation. That's fantastic because even up to this year, there was some sentiment in the media that smartphones and mobile devices are replacing game consoles – that people don't need dedicated game hardware anymore. But if you look at the number of pre-orders we're getting, it's a total shift of sentiment in talk on the Internet and in the media [now]. That's great.

With all hardware now network-connected, should consumers expect bumps in the roads with big product launches like this?

What we have put in the hardware is final so we can't change it. However, on the system software side we can keep adding or improving features from day one. We already have a roadmap of things we want to do on PS4. We're always swapping and tweaking priorities on our task list based on the feedback we get from consumers and media. That includes fixing some issues at launch. We are totally prepared for any issues we might find after the launch and we'll continue to add features that are missing or that people find useful.

Sony has positioned the PS4 as the console for core gamers, yet Microsoft's Xbox One has a greater number of big, core games coming on day one. Is this a concern for you?

We've always believed since the announcement [of the PS4] earlier this year that we've designed the PS4 to be the most powerful and capable system to run games on and the proof is in the pudding. The best way to look at comparing systems is to compare the [third-party] games that are available on multiple platforms, which have started to appear in the media over the past couple of weeks. I'm very happy that people are seeing the proof. People who have chosen PS4 must also be very happy.

Many consumers were upset by Sony's recent announcement that the PS4 won't play CDs, MP3s or stream videos from a computer.

That was really a surprise, to be honest. We really focused on making PS4 a great gaming system, that was our top priority for us. That doesn't mean we don't plan to ever implement lower-priority features. People didn't talk about these features [until we made the announcement] so we were not aware that some people are really liking them on PS3. We had to wait until the system software guys finalized their work before we could say what the feature list is for day one, so we learned that some people are really passionate about these features. Our guys are working on how to implement the features that people want to use.

In our defence, I might be criticized if I say this, but if the worst news about the PS4 at launch is lack of MP3 support, I think we'll be in a very good position.

The PS4 allows users to prioritize the download of certain portions of games – say, multiplayer first and then single-player. Is that going to open the door for publishers to sell those games in parts?

Absolutely publishers can choose to do that and they don't need PS4 to do it. Some games that were released in the last year, like The Walking Dead, that was a really successful implementation of of episodic releases. The industry talked about episodic gaming for ages, but not many games were successful. The Walking Dead showed how to do it and get people talking about it while they're waiting for the next episode to come.

There are lots of different ways to provide game content to consumers. In digital you can price your game anything you want, which will allow developers and publishers to try new ideas. One way to play that will catch on quickly, I think, are free-to-play games. Free-to-play games are extremely popular on the mobile and PC platforms. It just makes sense for games that people don't know about. It's a lot of money if you ask people to spend $60 to try your game. But if you offer that free to play for everyone and start charging people who like your game, that makes sense. We're supporting these types of games to come over.

What's the status of your Gaikai cloud gaming service?

The development team has been making good progress. We announced at E3 that we are planning to launch the service some time next year starting in the United States, and hopefully include Canada. That would add PS3 games to the PS4 and Vita. We're on track and we're waiting for the right time to announce the actual launch of the service.

Will it be possible for people who own older games to play over this service without having to pay for those same games again?

Technically it's not impossible but because cloud gaming services require certain testing – it has to play through the Internet – not all games work because of latency. Each game has to go through the technical certification. We're trying to offer as many games as possible through the service but we don't expect to be able to offer everything that PS3 has.

Does Sony still consider Nintendo a serious competitor or has the company's different direction resulted in completely separate audiences?

Nintendo is a great company. They tend to approach the packaging of their platform in different ways than we do. I think it's healthy and good for the industry to be able to tackle different kinds of consumers and to fill different needs. The Wii U looks to me like it's going back to its roots of offering family-friendly content. I think it's what they do best – they do an amazing making games that anyone can enjoy. That's an easier message for people to understand than them trying to go after core gamers. It [was] a bit of a confusing message when they launched. I hope they are successful so we can be really good competitors. Competition is always good for the industry because we try harder when we have it.

What about Steam and its Steambox? Are you concerned that it is an emerging competitor for that core living room gamer?

What Steam has done is amazing in terms of digital distribution, marketplace and community features. In a lot of ways they're pioneers. But I'm not really sure what their target is with the Steambox and hardware. I'm not sure what their goal is. The console business is very different from PC gaming. I don't know if they're trying to be a console-type provider or if they're trying to enhance PC gaming. We'll have to see.

What are your thoughts on 4K or ultra high-definition video – how relevant is that going to be to the PS4?

At launch, the PS4 has the capability to play back personal content like videos and photos to 4K TVs, but we don't have anything like a 4K player. We don't have the capability to play games at 4K resolution. That was a decision we made because when you look at the PS3, it was capable of playing 1080p – that was a really new thing, true HD, at launch. But when developers went to design their games, most chose not to do 1080p native resolution because there's always a trade off between resolution and frame rates and number of objects [on screen]. They made holistic decisions, so most games were made in 720p. It looks like it's shifting to 1080p on PS4, not just our own first-party games like Killzone and Knack but also third-party games like Call of Duty: Ghosts. After considering all the tradeoffs they have to make, they are still able to do 1080p rendering on the PS4. That's wonderful.

Was that 720p standard because of the Xbox 360? It was only initially capable of native 720p.

At launch, they didn't have HDMI output so they didn't support 1080p, but in the middle of the lifespan they added that feature. In designing the PS4, because we work very closely with the hardware guys, we said 1080p was right and we didn't want to say "4K gaming is here," because once we say it, people expect it and start asking questions: Why doesn't your game support 4K? In the future, we don't know. Some types of games might work well with 4K resolution.

So are games slightly behind other types of content in terms of video standards?

Not necessarily. When you look at 4K TVs today, those TVs have fantastic digital processing capabilities. They are upgrading 1080p content to beautiful 4K resolution. It's different from native 4K content but… it's more beautiful. All 1080p games will benefit from being played on 4K TVs, even today.