Opinion: The price of PS Vita memory cards is Sony's problem, not oursAugust 31, 2013 by


Sony's PS Vita is enjoying a bit of a software renaissance of late, with some fantastic new game releases to address the platform's nagging challenge of consumer demand (or lack thereof). But the influx of great software is highlighting another problem in Sony's Vita strategy.

The problem is the price of Vita memory cards. Or more accurately, Sony's problem is that not all PS Vita owners have 32GB of storage for digital purchases.

The missed opportunity is selling more games, and selling them digitally

Sony sees revenue potential in selling memory cards for Vita, but chasing that potential is squandering a much more significant opportunity. The missed opportunity is selling more games, and selling them digitally. Rather than chase the high margins of memory card sales (around 80% of Vita card price is profit), Sony should focus on encouraging the consumption of digital game downloads.

Digital downloads hold many consumer-friendly advantages over retail-packaged video games, especially for handheld systems. The user can access a library of games any time, without pocketing a bunch of cartridges. And downloading a game saves a trip to the mall.

But more to the point, digital game purchases are advantageous also to both Sony and publishers. A couple of years ago, the Los Angeles Times broke down the costs that contribute to a $60 game's price and estimated that 40% of the cost goes to expenses related to retail. (Those expenses include the retailer margin, and costs of physically producing, shipping, and returning physical product.) Skip retail and that 40% chunk is kept by publishers and Sony.

Another significant advantage for Sony and publishers: Digital purchases can't be resold, thus the threat of a used game market is sidestepped. Moreover, the friction between consumers and new purchases is reduced when the consumer doesn't have to leave home to buy product. In other words, digital consumers spend money more easily which, as a side effect, means consumers spend more money. (See: Apple's App Store, Amazon's Kindle Store.)

Which brings me back to Sony's Vita problem. Not every Vita owner has an abundance of free memory card space, ergo consumers download less content, and Sony and game publishers don't fully enjoy the benefits of a digital market.

Some PS Vita console packages ship with memory cards, 4GB or 8GB. My 8GB card was filled by just four games in a matter of months, after which every new game purchase was preceded by my agonizing over which already-installed software I should delete to make room. That agonizing often resulted in indecision, which meant I didn't buy a new game. Over the past year, Sony's missed out on a dozen or more impulse purchases because I didn't have the memory card space for them.


One is smaller, faster, more useful, and costs 75% less than the other

Even worse, the smartly-priced $199 PS Vita ships with no memory card at all. A healthy 32GB card costs an additional $80, even after Sony's absurdly shallow price drop. The result of this stinginess is that I've waited until now, after a year and a half of owning a Vita, to buy a bigger card and get back to buying games. Sony's memory card strategy stopped me from giving them money for a year, and I can't be alone.

That Sony's consumers don't have ample space for storing digital purchases is a significant problem. It is a problem with opportunity costs that, I suspect, far outweigh Sony's revenue potential on the sale of over-priced memory cards.

It is not simply an issue of gouging consumers on memory cards that cost triple the price of equivalent-size SD cards. That makes it out to be a problem for consumers like you and me, and that's not my argument. For Sony and its game-publishing partners, the cost of PS Vita memory cards is strategic error.

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