Ken Kutaragi - Role in The Gaming Industry

Role in The Gaming Industry

In the late 1980s, he was watching his daughter play a Famicom and realized the potential that existed within video games. At that particular time, Sony's executives had very little interest in video games. Thus, when Nintendo expressed the need for a wave-table sound chip for its upcoming new 16-bit system, Kutaragi immediately accepted. Working in secret, he designed and built the chip, the SPC700. When they found out, Sony's executives were furious. Only with Sony CEO Norio Ohga's help was Kutaragi able to push the project to completion and keep his job.

Even while working with Nintendo, within Sony, gaming was still regarded as a fad and something looked down upon. Despite this hostile atmosphere to video games, Kutaragi managed to persuade Sony to fund his research into the Super Famicom CD. These efforts resulted a device called the "Play Station", a console that would be compatible with both Super Famicom games and software released on a new format called the Super CD. Eventually, the partnership between Sony and Nintendo faltered due to licensing disagreements, but Kutaragi and Sony continued to develop their own console. Despite being considered a risky gamble by other Sony executives, Kutaragi once again had the support of Sony CEO Norio Ohga and several years later the company released the original PlayStation. The success of the PlayStation led to him heading up the development of more consoles like the PlayStation 2, and the latest console in the series, the PlayStation 3.

The commercial success of the PlayStation franchise makes Sony Computer Entertainment the most profitable business division of Sony. Despite being an upstart in the console market against veterans Nintendo and Sega, the first PlayStation displaced them both to become the most popular console of that era. The PlayStation 2 extended Sony's lead in the following generation, at one point holding a 65% market share with 100 million units shipped. Ken was recognized by many financial and technological publications for this success, most notably when he was named one of the 100 most influential people of 2004 in TIME magazine and the "Gutenberg of Video Games".

Since 1997, Kutaragi had been favoured to become the next Sony president. He enjoyed a close relationship with Sony CEO Norio Ohga, who had backed Kutaragi on the Sound Chip and PlayStation projects. Ohga's successor Nobuyuki Idei promoted Kutaragi to Deputy Executive President, Sony-Global Chief operating officer, and Vice-Chairman in 2003. However on November 30, 2006, Kutaragi was replaced as President of Sony Computer Entertainment by Kaz Hirai, the President of SCE America. Kutaragi was promoted to chairman of SCEI, and retained his position as chief executive officer of the group. On April 26, 2007 It was announced that Kutaragi would retire and instead take up the role of Honorary Chairman.