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Home » Sony Keynote at 2014 International CES by Kazuo Hirai (Transcript)

Sony Keynote at 2014 International CES by Kazuo Hirai (Transcript)

President and CEO of Sony Corporation Kazuo Hirai delivered his keynote address at the 2014 International CES describing how Sony has been at the forefront of consumer electronics innovation….here is the full keynote transcript at the CES 2014

Gary Shapiro – President and CEO, CEA

[Starts abruptly]…next wave of the consumer technology experience. Sony leads the way in shaping how consumers enjoy their music, movies, TV shows and games and delivers news ways for consumers to receive information. And Sony has the most options for consumers to create their own content and then watch it on any type of device. From the earliest days of the Trinitron and the Walkman to the dawn of the digital and high-definition areas to 3D and now lots of high-definition TV and high-resolution audio and across any type of platform, Sony is always a leader out in the front.

And, of course, Sony always has one of the most exciting exhibits here at CES year after year. In breadth of resources, it’s unrivaled in addition to its consumer electronics reach and a movie studio directly produces box office favorites, a music label that showcases the best in every genre and a professional group that covers everything in Hollywood to network news. Sony ties it all together into an intuitive and seamless consumer user experience. But don’t just take my word for it.

Our speaker this morning has personally been involved in many of Sony’s achievements. Like Sony itself, Kazuo Hirai, President and CEO of Sony Corp. is a man of many talents. He’s seeing consumer electronics from all sides from the successes with the Sony PlayStation business to international work with music artists to his leadership of Sony’s network products and services initiatives.

He also was the 2013 ESA Champion Honoree where he was recognized as one of the most influential executives in the entertainment industry. He is uniquely qualified to continue Sony’s leadership at the forefront of consumer electronics innovation.

Ladies and gentlemen, please join me in welcoming Sony’s Kazuo Hirai.

Kazuo Hirai – President and CEO, Sony Corp.

Thank you, Gary, for that great introduction. Good morning everybody and thank you for being a part of the keynote this morning.  And as Gary said, I know a lot of you had challenges coming into Las Vegas. I’m glad you made it, and I’m doubly honored with the fact that you’ve made it this morning to our keynote.

So ever since I was a boy, I’ve been curious. All sorts of things interested me whether they’re cars, science, gadgets, and of course electronics. I was, and I still am, very inquisitive.

Now, as you all know, childhood is a time of wonder and awe. It’s a time when the whole world around us captivates our curiosity and our imagination. Our fascination with children’s books to the questions about how things work, our experience as children is defined by play and by discovery. And one of my earliest memories was sitting in front of the television set watching Romper Room. Many of you watched it as well. It was an experience of magical connection, and for me emotional engagement with friends that I did not really know, but was relating to via my television.

Now, one day, I remember the hostess passing out cookies to the children on the show. I waited patiently and wondered where my cookie was. All the children on the television set, they were getting their cookie. And I kind of felt left out.

How did these people arrive in my living room each and every day? Why couldn’t they hear or see me? My curiosity was piqued, and has continued to be throughout my life. And today, I suspect many of the people in this room, right here, like me, still hold on to at least a bit of their childhood curiosity.

Now, we choose to be engineers, inventors, and creators because we’ve retained our childlike wonder and imagination. And at Sony, we cultivate curiosity.

Asking questions about how we might improve an everyday experience propels our desire at Sony to make things. And making things is a reflection of our desire at Sony to connect with people, to create surprises, to transform the ordinary into the extraordinary and to inspire people to experience, wow, wow.

Often, our curiosity stimulates creative thinking that yields those great innovations. For example, in 1979, the Sony Walkman became the first portable device that enabled a personal playlist, a favorite album, or that beloved mix tape — remember those? — to go everywhere that people went. It was mobile, and I have to say, it was a “wow.”

In 1982, the compact disc was introduced. This innovation improved recording, storage, and above all, sound quality. And I still remember the first time I heard a compact disc on, of course, a Sony CD player. And it was Billy Joel’s 52nd Street, and it sounded incredible. That, to me, was a wow.

In 1994 in Japan, we introduced PlayStation. And of course PlayStation became a game-changing home entertainment console. In fact, I was so wowed by PlayStation, I left the music business to pursue further development of the PlayStation franchise right here in the United States.

And PlayStation proved that consumer electronics products could be more. It could be more than just a modern convenience. Devices could provide emotionally rich experiences.

And today, our legacy of providing action-packed adventure takes another step forward with the launch of the PlayStation 4. The market, wowed by our technology and by our engineering and by our software. The gamer, thrilled by the lineup of amazing titles, they’ve responded enthusiastically around the world. And these innovative products created or redefined categories. And they’re all the result of curious minds asking, “What if? What if?”

They all emphasize the power of emotion in determining what has value to people. Myself, everybody in this room, everybody around the world.

Mobility enabled by the Walkman awakened people to the idea that they could take their favorite stuff with them wherever they went. Not just because it was convenient, but because it mattered to them. It matters to me, it matters to you.

The compact disc delivered a more powerful listening experience, one that allowed people to feel the music that they love. And, of course, the PlayStation continues to shatter all conventional thinking about game play, social connection, and the emotional rush of epic adventures and innovative games.

At the same time, however, there are challenges on the pathway to wow. Making powerful, emotionally compelling products is not always a straight line. Sometimes at Sony, we zigzag our way to great innovations, and simply other times, we fail.

You probably don’t recognize or remember any of these products, but don’t despair, neither does the rest of the world. So it’s okay.

But, you know, at Sony, failure is not really an end. It’s a reason. It’s a reason to keep trying. So we show you this.

This is the Betamax. Now, despite Betamax being first to market and, dare I say, offering superior technology than that other format. But I’ll be the first to admit: VHS won the battle for commercial success.

However, before you completely write off Betamax based on its failure to become the consumer standard, think about it as an idea. Take a look.

Here is the headline for Betamax featured in an advertisement back in 1975. Watch whatever, whenever. 1975. This idea still resonates and defines everything people desire and expect even today. We’re talking about freedom, we’re talking about flexibility, we’re talking about control over your own time and choice. Watching whatever, whenever.  That was almost 40 years ago. 40 years ago.

Now, as an interesting aside, by the way, Betamax, unfortunately, didn’t have that consumer success that we expected. But ultimately, it found its way as Betacam, a broadcast format with the same form factor as the Betamax and became, as you probably know, especially the people in this room, the de facto standard in broadcast and professional industry.  So all was not lost. As an aside.

Anyway, so we continue to be driven by that desire to evolve this idea of unlimited and improved access of watching whatever, whenever, while at the same time meeting consumer demand for experiences that are untethered from conventional devices and conventional wisdom.

But in an enterprise that makes things, we must first and foremost make that connection with people. Our products’ value is measured by them. And we find that it’s not just functional value that people desire, but the deeper and more elusive emotional value. Emotional value.

And in Japanese culture, we call this kando. Kando translates to mean emotional involvement. The power to simulate an emotional response. The power to make people say, “Wow.”  All Sony products must be inspired by a spirit of kando.

Advanced technologies and more elegant ergonomic designs are important ways products can seduce our sense of sight, sound, and touch. The wonder once associated with tangible products has been expanded by the migration of content, games, music, television, and a lot more to the cloud.

However, even though the cloud promises a connected future, the cloud itself is not the wow.  The wow happens when your senses are engaged, when you see the stunning visuals, when you hear the crisp sounds.  When you feel the weight and balance of a perfectly designed device in your hands.  When you are dazzled by a sublime form factor.  When you are amazed at the ingenuity and cleverness of a technology that you never thought was possible.

This is the heart of Sony. Those tantalizing objects that not only give us a wow, but in and of themselves are also the wow.

Now, our 60 years of product design experience grants us, Sony, the historical perspective, the expertise, and the collective power to deliver wow to everybody’s senses.  And I expect all Sony employees to put “wow” at the center of their efforts.  Product planners, hardware engineers, game creators, assembly line managers — my God, even corporate lawyers and finance professionals are all a part of an interconnected network of “wow” providers at Sony.

And recently, we’ve started to deliver that wow again.  Products like 4K, ultra high definition. When you see true native 4K content on a 4K television for the first time, that’s a wow. Visuals giving you such detail that you can see the atmosphere, you can feel the atmosphere, almost feeling like you can catch the dust particles dancing in a shaft of light.

Or listening to high-resolution audio using Sony’s end-to-end, high-resolution recording delivery and playback systems.  An entire generation — we all know this — an entire generation missed the visceral emotion of listening to uncompressed audio. The precision and clarity of every note.  The moment when a singer takes his or her breath before the chorus. Getting goose bumps as a song reaches a crescendo.

High-res audio allows the complete dynamic range of what the artist originally intended when they were in the recording studios creating their music.

The RX1 camera.  The moment of pride when sharing a perfect picture. The RX1 is a compact camera that empowers all photographers from the professionals creating art to parents capturing an important family memory with absolute, uncompromised quality.

Or the QX, the world’s first lens-style camera. Now, not only can you shoot using just the lens, but you can connect it to your smartphone and take the perfect shot and control the lens through your smartphone.

And of course PlayStation 4 is setting a new standard in gaming. Not only do we push the boundaries of play, but we also created a true object of sensation.

And with remote play, you can seamlessly connect and transfer the action from PS4 directly to your PSVita.

Experiencing a more intuitive and intelligent smartphone.  The Sony Xperia Z1 harnesses the power of the “one Sony” ethos. All of the Sony companies’ deep expertise and knowledge combine to make a mobile device that is truly the best of Sony, and something that only Sony can deliver.

Stunning visuals coming from our world-class TV group. Groundbreaking digital image capturing systems from, of course, the world’s best digital imaging engineers. Audio technology, games, apps, and more. The elegance of the package belies the robust technological capability within, making the Z1 a distinctly Sony design, a wow design.

And across our studios, there is a commitment to surprise, provoke, and thrill our audiences. We continue to tell stories from the romantic to the heroic, to the epic, to the personal, to the delight of global audiences.

And we don’t consider any product a success unless we have delivered that wow, that wow. And today our focus and drive is more deeply rooted in our philosophy of kando.

And we’re spending more and more time looking out at the world, at culture, at consumers than looking within.

And on the horizon, we see a next-generation consumer that is different from any before them. We think of them as “Generation Remix.” Born during the current millennium, they are true digital natives. Most of them know… they knew how to use a touch screen, a tablet, a smart phone, a DVR by the time they were toddlers.

Before they were born, a first wave of technical advancement required people to actually adapt to technology. But look out for this generation who will bend it — who will bend it to their will. They will control technology, not be controlled by it. Sampling, grabbing, curating, remixing will characterize the way they engage with technology and devices. They’re no longer worshipping at the altar of technology. They will be their own arbiters of what has purpose, functionality, and creative potential.

We expect them to bring a confidence about their own power to change the world, seeing technology as a tool to do exactly that.

Now, we have to ask ourselves:  What will wow them?  What will wow them? And it’s important to remember that the wow factor does not sit still and wait for us, we must move towards new and often challenging definitions of that wow.

Like, for example, the ability to see things differently. And the passion to provide technologies that will help people with longer, healthier, and more fulfilling lives.

The creation of better content and improved delivery systems, and seamless and unlimited access to live television, movies, music, and games. Even the evolution of traditional boxes and frames into unconventional image surfaces that transform the places where we live, work, and play.

I believe that these are the big ideas defining our course at Sony.

Now, we can push the boundaries of what we can see, creating the potential for a better, safer, more visually stunning human experience.

And with our advanced sensing technologies, we’re seeing in a completely new way. Advanced image sensors are providing an image-based reference to everything that we all care about.  They transform how data from a family portrait to a vacation photo to even more complex data can be sensed and captured, even when it cannot be seen by the human eye. This achievement from our Sony engineers creates a range of possibilities for future sensing technologies.

First, of course, for the photo enthusiasts, there will soon be super-sensitive cameras that enable amateur photographers to catch rich images with mood, and of course with atmosphere. And the subtleties of great photographs will be more accessible to everyone. Amateur photographers, enabling ease and simplicity to achieve tone and details that are often missed in conventional digital images.

And to further advanced the creative potential of our cameras, we’re developing an advanced camera that consists of a complete array of image processors that provide real-time photo capturing options. And these allow for options that can only be controlled when a picture was taken in the past.  But now, they can be manipulated after.  So we’re talking about background and foreground focus, color intensity, image enhancement, depth of field, and more.

And never before has there been a tool that can manipulate these core elements even after the photograph has been captured. And this gives extraordinary power to create the perfect — the perfect image that people are looking for.

And our digital imaging is exceeding all expectations for what’s possible. But we’re not satisfied with simply advancing photography, although that’s very important to us as well. Our sensing technologies have the potential to see the unseen. Capturing unseen data including location, speed, wavelength, and so much will expand our perceptions and give us some new insight into the world in which we live.

In the automotive segment, we’re envisioning super speed-sensing and processing technologies capable of generating images and color even when you’re driving in the dark. The sensitivity to detect and analyze various aspects of the driver’s physical condition as well as, obviously, the continuous monitoring of the driver’s environment — the road surface, weather conditions, pedestrian locations, oncoming vehicles — they all promise improved passenger and pedestrian safety.

In agriculture, the ability to sense CO2 consistency and other critical agricultural variables like weather, soil condition, and readiness for harvest will help people know when to pick the vegetables or food at peak season, detect disease in crops, even identify the freshness of perishables in grocery stores.

From agricultural to consumer application, the ability to capture data on food products and other consumables in real time at the point of purchase, that will facilitate safer consumption while promising, of course, higher crop yields to farmers and food producers.

And for those seeking to look and feel their best, we recently talked and introduced the development of what we call the Smart Skin Evaluation Program, with image sensors that can evaluate skin conditions in extreme close-up to provide individualized measurement and analysis of various elements of the skin such as texture, blemishes, pores, brightness, and coloring.

Now, this provides the basis for more targeted skin care, and if necessary, advanced treatments.

Advanced image sensors can make it possible to capture blood vessels, to actually see various data such as the level of oxygen saturation or blood sugar. And this data can be utilized and combined with smart phones and wearables that provide constant monitoring by a doctor who can deliver individualized and concierge-like care.

So consider the countless benefits of combining sensor technologies, the systems, and the cloud.

Medical data with, obviously, the individual’s permission can be shared remotely with a doctor using a secured system. And with the ability to see and track symptoms and diagnostics, doctors can actually communicate with people as needed, even when those folks are unable to visit a physical office to see their doctors.

And within our medical business group, Sony technologies are being readapted by healthcare experts to achieve seemingly impossible outcomes. For example, using our 4K and 3D display technologies, surgeons can see their operation in vivid detail, providing them advanced tools, delivering a precision once inconceivable in a surgical setting.

Through the development of more advanced sensors that in turn enable advanced imaging technology, surgery will be safer and patient outcomes will continue to improve.

These technologies are built from Sony’s vast expertise. Bringing together our brightest engineers to lead the way in developing technologies and products that enable healthcare providers to see with greater clarity, hear with improved fidelity, and work together in the pursuit of an improved human experience.

Now, another important dimension of the human experience is, of course, entertainment. Culture, the arts, music, games, and all forms of creative expression gives our lives meaning.  And one of the greatest pleasures that I have is in harnessing the creativity of our vast talent network at Sony.  Across that network, we’re asking ourselves how technology can drive better content and better delivery.  How new technologies can evolve and enrich the way we tell our stories.

Beyond greater choice, in where and when to access entertainment, we’re seeing a movement towards more sophisticated storytelling that is driving new levels of engagement. And Sony Pictures is exhilarated by this changing media landscape.

So to talk more about this new world of content creation, I’d like to welcome the CEO of Sony Entertainment and the Chairman and CEO of Sony Pictures Entertainment, Michael Lynton, and the Emmy-Award-winning creator of Breaking Bad, Mr. Vince Gilligan.

Thanks for being a part of the keynote.

Michael Lynton – CEO, Sony Entertainment; Chairman and CEO, Sony Pictures Entertainment

Oh, thank you for having us.

Kazuo Hirai – President and CEO, Sony Corp.

For stopping by.  Getting right into it. Michael and I, we’ve talked a lot over the past year about how new delivery systems of content to customers and consumers around the world are changing the way or the kind of content that we produce. And I wanted to first get, Michael, your take on it from a business perspective, and then from a creative perspective from Vince.

So, Michael, how has it changed in terms of the technology that we see in delivery?

Michael Lynton – CEO, Sony Entertainment; Chairman and CEO, Sony Pictures Entertainment

It’s really changed dramatically, and principally because of the new SVOD services that have come into the market both here in the United States as well as everywhere else in the world. So all of a sudden now, you have five or six SVOD services which are competitively bidding on television series and films that never existed before.  And first-run showings as well as syndication. So it’s changed both the marketplace as well as the economics of the business. Both for the positive.

Kazuo Hirai – President and CEO, Sony Corp.

Right. And how has it changed the creative process?

Vince Gilligan – Creator, Breaking Bad

Well, one example is that when I was starting off in TV about 20 years ago, the conventional wisdom at the time was that serialized storytelling was to be avoided at all costs.

Kazuo Hirai – President and CEO, Sony Corp.

So one episode basically completes the story?

Vince Gilligan – Creator, Breaking Bad

Exactly. Our episodes back then typically were more compartmentalized, and you could watch them out of order and you didn’t have to see every episode of a TV show, like the X Files, which I got my start on. And with these SVOD services, it really allows for a serialized sort of storytelling. In fact, even a hyper-serialized form of storytelling that we employed on Breaking Bad. It allows people to catch back up whenever they feel like it, any time of the day or night, and it’s been wonderful for us.

Kazuo Hirai – President and CEO, Sony Corp.

And that also, I guess, kind of creates that binge watching.

Vince Gilligan – Creator, Breaking Bad


Kazuo Hirai – President and CEO, Sony Corp.

People through network services.

Vince Gilligan – Creator, Breaking Bad

I tell you that phrase didn’t even exist four or five years ago I feel like. It’s a brave new world in TV these days.

Kazuo Hirai – President and CEO, Sony Corp.

Right. And then in terms of — we talked about delivery, but in terms of technologies that are part of the creative process, so whether we’re talking — obviously high definition 3D or 4K, how are some of these new technologies impacting the way you create content or that creative process?

Vince Gilligan – Creator, Breaking Bad

Well, I tell you, one great example is the amazing image capturing technology that exists now and that Sony is at the forefront on. These tiny little cameras. We typically shoot our show on motion picture cameras, big, bulky, expensive ones. But even now and then, with these tiny new cameras that exist, we can put cameras anywhere. We can put them in the back of a mailbox. We can put them in the wheel well of a car. We can have Walt driving his car over top of one of them or smashing into one of them. And you can put these things anywhere, and they intercut very well with the typical motion picture.

Kazuo Hirai – President and CEO, Sony Corp.

So the quality that you get from these small cameras, if it’s especially a short snippet, or short scene, is perfectly usable in TV shows then?

Vince Gilligan – Creator, Breaking Bad

Yeah.  Another one folks in the business never notice when we intercut one of these shots.  And these cameras are great because, as I say, they’ll fit anywhere, but also they’re inexpensive in a way that I can’t even believe now inexpensive they are.  And we can, therefore, risk breaking them.

Kazuo Hirai – President and CEO, Sony Corp.

We don’t encourage that.

Vince Gilligan – Creator, Breaking Bad

We know – we try not to break them but I’ll tell you, if it comes down to between a $300 camera and a million-dollar shot, I’ll break the $300 camera any day of the week.  That’s a great, freeing bit of technology.

Kazuo Hirai – President and CEO, Sony Corp.

So, Michael, from a business perspective, are you looking at other new technologies or new services that you see further potential in growing the viewership from a business perspective going forward?

Michael Lynton – CEO, Sony Entertainment; Chairman and CEO, Sony Pictures Entertainment

Well, yes on the services front, but it’s actually more on the device front because when you really look at what’s going on with the mobility of devices, whether it’s tablets or smart phones, what we’re seeing is that people are now watching television shows or movies in places they never would have done so before.  You were sort of only allowed to watch them, pretty much, in your home basically.

And now whether it’s on a bus or a train or even out in the park, you see people watching our shows and our films. And that really expands the market dramatically because people have a lot more time to do it.

Kazuo Hirai – President and CEO, Sony Corp.

And so Michael just talked about various devices, but in the creative process, do you think about, for example, a lot of audiences that are going to be enjoying content, ultimately, on smaller screens like tablets or even smart phones?  I mean, does that figure into the creative process as well?

Vince Gilligan – Creator, Breaking Bad

You know, I’ll take viewership any way I can get it.  And if folks are watching Breaking Bad on a lovely Xperia phone, for instance –

Kazuo Hirai – President and CEO, Sony Corp.

Did you hear that?  Xperia Z. That’s a good phone.  Thank you.

Vince Gilligan – Creator, Breaking Bad

That’s great. And I’m all for that. In my mind’s eye, of course, you know, being a bit grandiose in my vision for the show, I want to picture folks watching it on a big, beautiful monitor. And I tell you, these giant-screen TVs now, as exemplified by the Bravia series, allow folks like me to change the way we compose shots in television. Historically, television was composed for 19-inch black and white TVs.

Kazuo Hirai – President and CEO, Sony Corp.

I remember those.

Vince Gilligan – Creator, Breaking Bad

Yes. You’d frame like this. You’d cut into the forehead and there was a lot of series of talking heads cut back and forth. But with these giant, wide TV screens now, you get to frame on your best day you try to emulate John Ford or Akira Kurosawa or Sergio Leone and you get to frame, in the case of Breaking Bad, you get to show these little characters on this broad, endless expanse of New Mexico prairie with the beautiful clouds overhead and the mountains in the background and it gets to look very painterly and very cinematic. And that’s a wonderful development.

Kazuo Hirai – President and CEO, Sony Corp.

So it’s always exciting to see new technologies evolving. That really helps to really add more or change the creative process. So you, obviously, keep an eye out on developing technologies.

Vince Gilligan – Creator, Breaking Bad

Absolutely. And I’m looking forward to this headset device.

Kazuo Hirai – President and CEO, Sony Corp.

The head-mount display.

Vince Gilligan – Creator, Breaking Bad

The head-mount display. I want to check that out because it’s one thing to watch an 85-inch TV, which is amazing, but it’s another thing still to see, what is it?

Kazuo Hirai – President and CEO, Sony Corp.


Vince Gilligan – Creator, Breaking Bad

Yeah. That’s, like, wow. Just to be enveloped, to allow folks to be enveloped by the storytelling, whether it’s Breaking Bad or whether it’s – you know, as a fan, if I could be enveloped by The Godfather or enveloped by Jackie Brown, one of my favorite Tarantino movies. I’m looking forward to that.

Kazuo Hirai – President and CEO, Sony Corp.

So, obviously, we want to make sure that we bring new technologies to you so that you can further develop and improve upon the creative process and bring more exciting content to audiences around the world. And I hear you’re working on a spinoff to Breaking Bad.

Vince Gilligan – Creator, Breaking Bad

Yes. We are doing Better Call Saul.

Kazuo Hirai – President and CEO, Sony Corp.

Better Call Saul.

Vince Gilligan – Creator, Breaking Bad

Which is our wonderful, crazy lawyer character. Right on. We’re plugging away. My writers back in Burbank are plugging away as we speak and I am, of course, here. I’d rather be here. This is more fun than being in a writers’ room. But we’re looking forward to having that within about a year.

Kazuo Hirai – President and CEO, Sony Corp.

We’re very much looking forward to it.

Vince Gilligan – Creator, Breaking Bad

Thank you.

Kazuo Hirai – President and CEO, Sony Corp.

Great, thank you very much. Thanks for stopping by.

Thank you, Michael and Vince.

Now, clearly, as Vince and Michael talked about, integrating existing formats with new technologies is providing a better and more convenient viewing experience. And our vision, and one we’re uniquely positioned to shape, is to continue to further the integration of the world of consumer electronics and entertainment.

And in the world of gaming, technology is also providing exciting new potential for storytelling and immersive play. So one great example of playful curiosity can be found in, where else but the bucolic countryside of England?

Media Molecule, one of our game development studios, is a team of true inventive minds. They continue to inspire me with their passion and unique brand of offbeat creativity. They are creating gaming experiences that are wildly imaginative. Their blockbuster title, Little Big Planet, introduced an entirely new and different kind of gaming experience featuring a playful environment built by the users and encouraging sharing and connection.

And the community grew. And today, Little Big Planet is inhabited by millions of people inspired by participating in the creation of this whimsical world. This game heralded things to come. And today, their recently released and very highly-acclaimed title called Tearaway validates the power of individual contributions to the gaming experience.

And Media Molecule have been outspoken advocates for the PlayStation 4, calling PlayStation the “ultimate creative console.”

So, recently, we spent some time in England capturing the joy, exhilaration, and of course the frustrations and successes of their creative process. And because, as you all creators know, the creative process is one of the most rewarding yet challenging professional and artistic journeys. So please take a look.

[Media Molecule Video Presentation]

Kazuo Hirai – President and CEO, Sony Corp.

So as you just saw in that video, Media Molecule is a perfect example of the type of highly ambitious, highly creative makers of kando, that wow that we nurture at Sony.

So whether they’re making games or encouraging gamers to make things on their own, theirs is the realm of creativity, whimsy, and of course fun. Producing great content is just one step in enhancing how people experience entertainment. And today, we’re in the process of evolving the business of how people access the entertainment they want.

The tethers that have constrained entertainment consumption for decades, since the very first radio waves and TV signals were beamed into our homes and game cartridges were inserted into consoles will soon dissolve.

In fact, we’re already making considerably process is pioneering a new era of freedom and choice for the movies, TV shows, music, and the games that you always want at your fingertips.

So to tell you more about how Sony is evolving access to entertainment content, please welcome the president and group CEO of Sony Computer Entertainment, and Sony’s executive in charge of Sony Network Entertainment, Andrew House.

Andrew House – President and Group CEO, Sony Computer Entertainment

Thank you, Kaz, for having me here today.

The excitement at CES is always invigorating as all eyes are on the industry’s best, most innovative, and most promising new products.

PlayStation is no stranger to the profound impact of a breakthrough product and how it can cause people to rethink what is possible. As many of you are aware, we recently introduced a little product called PlayStation 4 to some great fanfare around the world. It quickly became the largest console launch ever, selling over 2.1 million units in just two weeks.

And today, I am delighted to announce that the cumulative sell-through has now passed 4.2 million units as of December 28, 2013. Thank you.

The PS4 embodies the type of technological advancement people have come to expect from PlayStation for the past 20 years. While I’m extremely proud of the incredible sophistication of the PS4 hardware, that is the physical and tangible aspects of the most powerful system we’ve ever created, I’m equally proud of what you can’t touch and feel.

I’m, of course, talking about the network that sits at the core of PS4 and all PlayStation platforms. The network delivers virtually unlimited opportunities for our customers and represents the future of our industry.

Sony’s network vision is to deliver rich entertainment experiences that empower you to discover, connect, and engage with your favorite content on virtually any device when and how you want.

If you own a PlayStation system today, the network enables you to easily connect with friends, to unlock the full potential of games and to give you access to an incredible library of titles. In fact, PlayStation’s library of titles is one of the most expansive in the world, filled with memorable experiences that have kept gamers entertained for years. As we built the new network, we asked ourselves, “What if we could unlock PlayStation’s library of games so that they’re instantly available on PlayStation® devices as well as non-PlayStation devices?”

We’ve been steadfast in our commitment to make this a reality, and have made incredible advancements towards integrating Gaikai’s advanced cloud-based technology into our network. The result is nothing short of amazing and marks the beginning of a new era of streamed gaming that eliminates traditional barriers without compromising the quality of gameplay.

I am pleased to announce the new streaming game service, PlayStation Now. This service will, in the long term, provide existing PlayStation gamers with instant access to the games they loved from previous generations, from the original PlayStation, PS2, and PS3.

Equally important, the service will also introduce the world of PlayStation to even non-console owners via smart phones, televisions, and other devices. Soon, playing your favorite PS3 game on a tablet will be a reality.

And actually, you can try PlayStation Now on Sony Bravia TVs and PlayStation Vita systems in the Sony booth this week at CES. For the first time ever, you can play blockbuster PS3 titles, including PlayStation game of the year, The Last of Us and Beyond on a Bravia or PS Vita exclusively at the show.

Streaming the rich, high-definition gameplay experience delivered by The Last of Us, with low latency, is a remarkable achievement and it demonstrates how we are paving the way for gamers to play whenever and wherever. We’ve heard that earlier on.

We are also going to offer gamers choice when it comes to how they want to access content on PlayStation Now. So they’ll be able to rent by title for specific games they’re interested in, and we’ll also offer a subscription model that delivers additional value and allows people to explore a range of titles that they might otherwise not have experienced.

I’m pleased to confirm that we will begin a closed beta in the U.S. at the end of January, with an expected full rollout this summer.

Sony’s network vision for revolutionizing entertainment through cloud-based services isn’t confined to games. For years, consumer electronics companies have tried in various forms to transform the living room and the home entertainment experience because it is fundamentally outdated and flawed.

In a technology era that is defined by simplicity and improving people’s lives by making things more intuitive, personal, and social, elegantly combining live TV, video on demand, and DVR content remains the last frontier.

Sony’s vision for the future of home entertainment is grounded in giving you the freedom and choice for what you watch when you want to watch it and what you want to watch it on.

Our goal is to transform the user experience so finding and discovering live TV and video on demand shows is intuitive and immediate. We will make TV a more personalized and dynamic experience that caters to your preferences and adapts to your viewing habits.

Today, I’m thrilled to announce that Sony will introduce a new cloud-based TV service in the U.S. this year that combines the live TV content people love most about cable with the dynamic experience they’ve come to expect from digital media services.

The service will give you the most popular live TV programs, combined with a large library of video-on-demand content so people will have all of their favorite movies, TV shows, and sports programs available through a single destination. The service is distinguished by an intuitive and dynamic interface that gets to know you, as well as personalized channels that cater to your tastes.

If a family member enters the room and picks up the controller, they can immediately access their own personalized menu. It also solves one of the greatest hurdles to live TV and digital media services: ease of content access.

Our offering will enable you to quickly search and discover across live and video-on-demand content using intuitive, dynamic filters without having to use multiple boxes. You’ll also be able to discover new channels by seeing what your friends are watching and recommending, or by your viewing history.

The service also provides the ability to watch and resume across various connected devices. So you can seamlessly switch viewing live TV or video-on-demand content from a PS4 in the living room to an iPad in another bedroom.

No other company in the world is better poised to lead the TV revolution than Sony. There are more than 70 million Internet-enabled Sony devices in U.S. living rooms today, including 25 million PlayStation 3 systems. And millions of people already rely on Sony for their video needs.

In fact, based on the number of users streaming videos on any given day, our network would rank about the top 5 cable and satellite providers in the U.S. And PlayStation 3 is the number-one device in the world for watching Netflix in the living room.

Sony’s new cloud-based live TV and video-on-demand service will redefine the ease and accessibility of live television, video on demand, and DVR viewing experiences. And while it might be a revolutionary experience for our customers, the new service is a natural evolution of Sony’s offerings.

We are one of the largest entertainment companies in the world, and we’ll use our unique combination of network services, innovative devices, content properties, and network partnerships to usher in a new era of home entertainment.

There will be more details forthcoming, but the future is very near. We plan to start testing the service in the U.S. later this year.

Thank you very much for your time.

Kazuo Hirai – President and CEO, Sony Corp.

Thank you, Andy. A more robust networked entertainment delivery system will be a hallmark of Sony as we move into the future. We will be offering customers a single source of entertainment that is less complicated, more cost effective, and more accessible than ever before.

Now, at the beginning of this presentation, I shared with you about my childhood and how I became enchanted by what might be possible. And that curiosity has continued to grow within me. And today, I am even more excited and inspired by what might be next.

And my passion for electronics has grown throughout my life. But more than that, my conviction about creating a Sony culture with a commitment to deliver products with emotional value has matured and evolved over time.

Now today, Sony offers a vast array of products: televisions, game consoles, image capture, mobile devices, professional broadcast equipment. These products enable us to provide people with content, entertainment, and social connections. However, these products also have certain limitations.

So in looking forward, as Andy described, our desire is to break out of the confinements of physical places or even primary devices as the only points of access. The conventional boundaries are being transformed, if not vanishing altogether.

Sony will be releasing products in the very near future that will create an entirely new concept of consumer electronics. These concepts will reshape our personal media landscape and transform our living spaces into evolving environments.

We’re envisioning and creating a world where people can enjoy, where you can enjoy new ways of experiencing entertainment. Freely and without the restrictions of frames, boxes, and displays.

The essence of this vision is a new and emerging concept that we call the “life space UX” concept. And one of the first steps we’re taking in breaking free of the traditional screen or devices is the ultra short throw projector. This state-of-the-art device can be placed anywhere in the home, turning an environment into a dynamic living space.  Normal walls will become fluid displays.

Our new concept, life space UX, does more than just eliminate boundaries. This new vision creates a brand new sensual and atmospheric experience that utilizes space itself. For example, you can create a window with a view of the outside which transitions throughout the day to your own liking. Or you can turn your favorite movie scenes into wall art with gradual transitions bringing mood and atmosphere to the places where you live and work.

And I’ve seen awe-inspiring and wow-inspiring product in action. So the other day as I stood in my office on the 20th floor at Sony headquarters in Tokyo and I looked at a wall, a perfect window formed revealing a view of a street scene in the Ginza.

And what was beyond that wall, the street scene — pedestrians, cars, taxis, buildings, and public spaces, all to perfect scale — was displayed in vivid 4K image quality on that wall-sized canvas.

And to me, it opened up countless possibilities. Imagine being an avid surfer and having the perfect wall-size window to see the world’s best surf spots vividly in real time in your living room. Or perhaps you can’t make the concert tonight, and now you and your friends can have a private sky box view.

With its stylish design, this ultra short throw projector enables a cinematic-like experience to be wherever you want it to be. It’s easy to install, and it’s capable of projecting a 147-inch 4K image just by placing the projector near the bottom of any wall.

And I’m happy to announce that the first version of this product will be available to consumers right here in the United States this summer. This is only the first step on the way to a new reality, one in which the user, one in which you are able to control content in entirely new ways.

So as we consider the possibilities of the borderless environment, we’re also exploring other types of future-oriented products that break free from conventional screens and boxes. So for example, our Tabletop Screen takes information and projects it onto a flat or even a convex surface in high quality that can be controlled by your fingertips.

So imagine using the surface of, say, a dining room table as a giant touch screen where you can video chat with traveling members of your family or map a vacation in an exotic locale, or just share images by sliding them across the table on your dining table. This technology brings content to the center of the household, untethered by devices.

This technology, the technology driving this innovation is built around a super small laser projector and intelligent processing system that captures the movement of our fingertips, using a highly accurate depth recognition algorithm. It is, to me, a very transformative technology, bringing what was formerly only accessible on the screen, again, right to the heart of the home.

So, soon, the home, the office, the places where you and I need and want to be will be perhaps free from traditional notions of frames. And what lives beyond those display devices are transformative space technologies.

So the life space UX is precisely the type of visionary concept that Sony is uniquely qualified to lead because, once again, it is rooted in kando, delivering that wow. That is, integrating software and hardware and content to deliver magical human experiences that evoke emotion and reverberate across all of our categories. These innovations help people see the world as both expansive and accessible — a place of limitless potential for learning, knowledge, wellbeing, connection, laughter, and of course joy. And that matters deeply to me and to all of Sony.

I believe the mission of Sony is to inspire and fulfill people’s curiosity around the world. I believe that we must have a unified single vision and a “one Sony” ethos. And I believe it’s time to move beyond the “just good enough” era.

No more commodity products. No more parity products. No more “just good enough” products. We must and we can do better. And I believe people care deeply about the products that define their lives, your lives. These products must be fantastic objects of sensation that engage all of our senses. And I believe we must empower our creators, designers, and engineers to be curious, to take risks and make great products that deliver kando.

I encourage them to follow their passions. I expect them to always strive, to fight, to dig deep inside themselves and create the products that they can be proud of, to make products that are worthy of the four letters S-O-N-Y. And I believe that products created with pride will, in turn, instill a pride of ownership and create meaningful emotional value with all of our consumers.

And finally, I believe in the power of wow. I am optimistic looking forward and envisioning a Sony that is conceived for the future. And I am optimistic about the role that consumer electronics will play in advancing the human experience.

If we are all truly curious –  not just Sony — if we are all truly curious, if we listen to what people desire and anticipate the needs of future generations, we will find that we must make innovative products that integrate functional value, but more importantly, emotional value.

And we must remember, we are an industry, all of us, we’re an industry built on “wow”. So I encourage everyone to come to the Sony CES booth. And please, be moved.

Thank you very much and have a great CES. Thank you.

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