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AOL talks to Sony about PlayStation 2 deal

Wants to bundle Net access with Sony's new console

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AOL is talking to Sony about providing access to its online service and the Internet to all those PlayStation 2 users out there. Well, the ones who've managed to get hold of a console, at least.

The world's biggest ISP is also chatting with Toyota, about in-car Net access services, the Asian edition of the Wall Street Journal reported this morning.

The pitch from AOL is no doubt one of many Sony has received. "The company has [had] a variety of talks with many companies to provide broadband content through PlayStation 2," a Sony Computer Entertainment spokesman said, according to Reuters.

PlayStation 2 has always been as much about providing a home gateway to the Net as playing flash videogames. Sony doesn't want to push the Net side of things too much yet since it's waiting for more broadband networks to become more widespread, especially now while production is proving so problematic.

What's not clear about Sony's strategy is whether it will seek to provide Net access itself. As a major content provider - through Sony Pictures Entertainment, Sony Music Entertainment and the software side of Sony Computer Entertainment, all of them now operating under the Sony Broadband Entertainment umbrella - and the supplier of the hardware, Sony might very well want to retain full control of the link between the PlayStation 2 and all those online movies and songs itself. In other words, it may want to promote its own ISP operation exclusively.

The snag here is a potential monopoly question - might Sony restrict access to its content to PlayStation punters and subscribers to its ISP? Similar concerns prompted both the European Commission and Federal Communications Commission investigations into AOL's proposed merged with Time-Warner.

An AOL deal with Sony would go some way to calming such fears about both companies. Both get to show they are opening their products to a rival content and Net access provider.

And there's a certain synergy here. Both Sony and AOL are prime competitors with Microsoft, and on the basis that your enemy's enemy is your friend, the two might well want to come together in an anti-Xbox/MSN axis.

The Toyota talks, meanwhile, centre on extending AOL's e-commerce strategy, this time via Toyota's Gazoo.com automotive portal. Gazoo.com is essentially an e-commerce site for Toyota cars, though it may soon offer General Motors vehicles too, the two vendors having been in talks since February to align their e-commerce ventures. AOL essentially wants to offer Gazoo's facilities through AOL's online service too, according to the AWSJ report. ®

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