Video Game News and Reviews

1. Euro PS3 to have limited backward compatibility

Sony Computer Entertainment Europe released the official specifications for the PlayStation 3 console, which will not include the PlayStation 2's Emotion Engine chip, thus limiting the PS3's playback capability for PlayStation 2 games. Japanese and U.S. models have a high rate of PS2 backward compatibility, near 98 percent. Although Sony did not provide a specific figure, the number of compatible PS2 games for the European, Middle Eastern, African and Australasian versions of the console is expected to be much lower. Sony said firmware updates would enhance compatibility as time goes on. "PS3 is first and foremost a system that excels in playing games specifically designed to exploit the power and potential of the PS3 system," said Sony Computer Entertainment Europe president David Reeves. "Rather than concentrate on PS2 backward compatibility, in the future, company resources will be increasingly focused on developing new games and entertainment features exclusively for PS3, truly taking advantage of this exciting technology."

Some analysts see the move as a positive one for the company. Datamonitor analyst Alex Kwiatkowski said the move will positively impact the long-term cost profile of the console. "By launching the PS3 in Europe with the new chassis, Sony has at a stroke removed one of the barriers to future price reductions, and providing it can make enough units available, Datamonitor believes there will be sustained growth in PS3 ownership as new users seek to benefit from the PS3's enhanced features and functionality," he said.

2. Circuit City to enter used gaming market

Electronics retail chain Circuit City will offer used games for sale in select stores and online. Video game retail chains like GameStop have found success with trade-in programs and used game sale strategies, which can offer 50 percent profit margins and have generated more than $1 billion in revenue annually. Lazard Capital Markets analyst Colin Sebastian said rival chain Best Buy experienced only limited success with a similar program, which it experimented with in 2006.

As Circuit City's strategy offers no real competition to GameStop's business, the video game retail chain should continue to hold a comfortable lead on the used-game market, predicts Sebastian. The chain's "experience and track-record with used product sales, broad inventory of new and used video games and its core video game consumer base," give it a strong market edge, he said.

3. Babel Media expanding Montreal staff

Outsourcing and post production specialist Babel Media announced plans to expand its workforce in Montreal by 350 people for a total of 500 employees. The news comes after last week's expansion announcements by Eidos' and Ubisoft's studios in Montreal. "We have recently signed contracts with clients who, without exaggeration, own some of the greatest IP in the world," said Babel managing director Algy Williams.

The company looks to hire new members of its quality assurance division, as well as project managers in multiple divisions. "We will be testing their games across all platforms, including PS3 and Xbox 360, and we need to recruit talented and motivated people who are looking for a career in the games industry."