Glitches send PlayStation3 launch into OT

It’s not looking like a very merry Christmas for Sony, as it had to push back the launch of the PlayStation 3 in Europe to March from November and cut back shipments in the U.S. and Europe.

The Japanese tech giant blamed the delay on production problems with a component of its Blu-ray high-def DVD system, which is key not only to the PS3, but much of Sony’s next-gen entertainment strategy.

Sony already delayed the worldwide launch of PS3, its next-gen videogame player, high-def DVD and online entertainment system, from the spring to November.

New delays mean it will miss the lucrative holiday season in Europe entirely and have only limited potential in the U.S. and Japan.

An exact date for the European launch in March hasn’t yet been set.

Sony Computer Entertainment chief Ken Kutaragi told reporters in Japan that Sony will likely ship 2 million units by the end of the year, half the initial estimate. Company is still planning to ship 6 million worldwide by the end of March, however, in line with earlier estimates.

Microsoft shipped only 1.5 million units of its next-gen videogame console, the Xbox 360, due to production delays.

However, Sony’s delays will put it at the back of the videogame pack at launch. Now that production is running smoothly, Microsoft estimates it will have sold 10 million 360s by this year’s holidays. In addition, Nintendo is launching its next gen Wii console in November and has said it will ship at least 4 million by the end of this year.

Delay is the latest problem for the PlayStation 3, which is crucial not only to Sony’s continued dominance of the videogame market, but the success of its Blu-ray high-def DVD format and its strategy for digital entertainment.

In May, when Sony announced the PS3 will cost $500 or $600, depending on the version, industry insiders said that could give a boost to the competition, as the 360 costs $300 or $400 and the Wii will be under $250.

Sony shares fell 2% to $42.84 on the NYSE, 60 points to 5,050 on the Tokyo Stock Exchange, and even lower on European bourses.

News isn’t bad for Sony alone. Shares in every major videogame publisher, including Electronic Arts, Activision, and THQ, were also down on Tuesday.

(Steve Clarke, Mark Schilling and the Associated Press contributed to this report.)

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