Sony is facing an undercurrent of fear in the retail channel after it revealed plans last week to sell its much-hyped PlayStation 2 (PS2) gaming console direct via the Internet.
The move is unlikely to garner retail support particularly amongst smaller store owners who are worried they will not be given access to stock if Sony pursues a direct sales model.
"Sony is cutting its nose off to spite its face, bypassing all the retailers," said a Sydney-based retailer who did not want to be named. "As to the supply, only the top 10 per cent are actually going to get consoles, Sony won't even have enough of them. Business is hard enough as it is without vendors doing that as well."
Sony has yet to announce an exact launch date or pricing structure for the console believed to cost up to $800.
Sony denies the move will create conflict in the channel, saying the online sales site is a "natural progression" in sales based on computer-aware consumers.
"We are very, very supportive of our traditional base," said Sony's director of e-commerce and marketing, Sapna Khara.
"We have reached our strong position because we have had the support of the retail sector. Sony is going online because PlayStation consumers are very Internet savvy."
The site will launch simultaneously with the availability of PS2 in stores and will sell at the recommended retail price, according to Sony.
"We are not undercutting retailers in any way and we will continue to support them. We are very much in partnership with retailers. The online arm is just another sales channel. It's not brain surgery here," said Khara.
Sony has set up the PS2 console to be one of its three business pillars. However retailers remain sceptical of the impact it will have in the local consumer market.
"I believe that both N64 [Nintendo] and PS are as good as dead, very slow movers and getting slower as time goes on," said Adelaide-based software retailer Rob Beaumont, who believes there won't be a big demand for PS2. "We are quitting all [PlayStation] stock to concentrate on DreamCast as we see that as the future. That is also echoed by our customers."
Sega DreamCast distributor OziSoft believes Sony's online store could help push consumer sales towards the rival console.
"I don't know that it will be the best move for the machines," public relations manager Kym Warner said of Sony's online store. "The price point will not make PlayStation2 appealing to many customers."