• by Josh Lovison , January 9, 2009

Between Christmas, Hanukah, and New Year's, tons of people went home for the holidays.  Including to Sony's Home on the PS3, the virtual world that launched in open beta right before the break.

The service seems to be doing quite well, despite some of the hazing it's received across the blogosphere.  According to the senior director of the Playstation Network, the service had  greater revenue through micro transactions in the first four days of the launch than the Playstation video download service had in its first week.  Considering the disparity between prices (from 99¢ to $5 in Home, and up to $14.99 for a video), this is a pretty significant accomplishment.

Much of the flack for the service has been for the limited content available.  It looks like that will begin to change this week.  A  content update is on its way that will bring a Red Bull Air Races branded space, storefronts for Diesel and furniture store Ligne Roset, and a pre-order tie in for Killzone 2 and Amazon.com.  As these will be the first significant non-gaming properties advertised in the virtual space, it will be very interesting to see how things fare, and what the profit potentials are for the branded storefronts.

Other good news for Sony has been the announcement that internal numbers show a 130% increase in holiday sales from 2007.  This is particularly significant considering another much-discussed item before the break, namely the decrease in year-to-year sales for the PS3 for November.  According to Sony's vice president of sales, this decrease was due to the sales boost a price cut caused in November 2007.

Bottom line: while a lot of the press in December before the holiday break prophesied doom for the PS3, I think this was more reflective of the ADD nature of analysts than the actual state of the console.  Stepping back and looking at the larger picture, the PS3 remains competitive in features, and the LBP community continues to surprise me.  Sony continues to build out the notions of social experiences and user-generated content development, and if they manage both a price cut for the system and a greater push for consumer adoption of Blu-ray, I think they'll grow their numbers significantly.  It's taken a while for the Playstation 3 to define itself, but I think we're just starting to see the console come into its own and break new ground.