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Sony hits Xbox One where it hurts: price, 'always-on' Internet

Sony Computer Entertainment America President and CEO Jack Tretton addresses the Sony news conference show on the eve of the opening of E3 in Los Angeles, California, June 10, 2013.

DAVID MCNEW/REUTERS

It's customary for fans and press to declare a "winner" at the annual Electronic Entertainment Expo, even though there's generally no real prize other than bragging rights at stake. That said, it's hard to imagine Sony's victory over Microsoft on Monday being more total and complete.

The Japanese company came out swinging at its evening press conference, rejecting in no uncertain terms Microsoft's vision of the future of gaming – one that would require a persistent Internet connection and restrictions on what players can do with their games.

The PlayStation 4 will allow players to sell, trade and lend games as they currently do, with no limitations, and it won't need to validate those games online daily. Microsoft's respective next-generation console, the Xbox One, currently has all of those restrictions.

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"We believe in the model that people embrace today with the PlayStation 3," said Sony Computer Entertainment of America chief executive Jack Tretton. "We won't impose any restrictions on used games. It won't require you to check in online. It won't stop working if you haven't authenticated within 24 hours."

The clear and simple policy statements drew thunderous – and prolonged – cheers from the thousands of fans in attendance, as well as instant approval from people following the event online. Judging from the reaction, the gaming public is clearly behind Sony.

Andrew House, group chief executive of Sony Computer Entertainment, drove the position home further. "The gaming landscape is changing with new business models, but true consumer ownership and consumer trust are central to everything we do," he said. "With each new platform, we will continue to build upon that trust."

As if the knife wasn't in deep enough already, Sony also announced the PS4 will be priced at $399, or $100 less than the Xbox One price revealed by Microsoft earlier in the day – another statement that drew loud cheers. The price discrepancy likely comes from the Xbox's Kinect voice and gesture sensor, which so far is not optional and will come bundled with every console.

With gamers likely to buy only one of the two consoles this holiday season – Microsoft announced a November release – it's relatively easy to predict which will win out. Both consoles have a more-or-less equal offering of high-profile exclusive games, meaning that Microsoft will have no choice but to go back and revisit some of its policies.

Sony didn't just deliver everything gamers were asking for, executives also took pains to point out how they are catering to independent game developers. Indie creators can self-publish their releases on the PlayStation 4, an option that is so far not open to them on the Xbox One. Indie studios can make games for that console – Toronto's Capybara Games' upcoming Below was highlighted by Microsoft during its press conference – but they must go through an established publisher to do so.

The PlayStation 4 has a slew of indie games lined up, including The Witness, Transistor and Outlast, from Montreal's Red Barrels, compared to only a few mentioned by Microsoft so far.

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Even if the company revisits and rejigs some of its policies, the damage to its reputation may already be done. As the Sony executives subtly suggested, gamers' trust is a hard thing to win and maintain. Microsoft could scrap its used-game restrictions and online requirements, but gamers may not believe the company won't re-institute them down the road now that they've been initially proposed.

The situation is a great example of how quickly fortunes and attitudes can change in the world of technology. Just a few years ago, Sony was the villain of the gaming world that was suing individuals for hacking the PlayStation 3. But in this latest twist of fate, Microsoft seems to have badly misjudged its own vision versus the desire of consumers, much like it recently did with its Windows 8 redesign and subsequent reversal.

The irony is that the company may end up being right – and having better games than Sony a few years down the road. The Xbox One is capable of using Microsoft's cloud computing servers, meaning that developers can offload some of their games' required processing capabilities to the cloud. That will require the sort of continual online connections the company has been talking about, but also likely result in more powerful games.

It's possible and perhaps even likely that Sony will go this route as well, but the company has yet to talk up that possibility. Always-online games that can't be traded in may indeed be the way of the future.

In the meantime, Sony is emerging from this year's E3 as the saviour hero of gamers. Microsoft, for its part, is looking every bit the cranky troll living under the bridge.

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About the Author

Peter Nowak has been writing about technology for 20 years, with a focus on trends and how they affect the world. He worked at The Globe and Mail between 1997 and 2004 before moving to China and then New Zealand, where he won the award for best technology reporter at the New Zealand Herald. More

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