Sony Playstation getting a firmware upgrade

Sony's Playstation 3 development was delayed, missing its milestones and being pretty expensive. In the high stakes for who wins the gaming console, Sony PS3 is behind its 2 principal rivals, the Nintendo Wii and Microsoft Xbox in terms of market sales; and given the high cost of the entire PS3 development, including the price of the machine, Sony needs to sell more machines to get over current costs and make a profit. How can it do that ? In terms of gaming power, it is fighting an equal battle with the Xbox, and the Nintendo Wii was a match-winner in terms of customer 'wow' factor, so Sony was not going to be able to beat the others in having something unique.
Well, Sony things that they have found something; the decision to include an expensive Blu-Ray has been criticized for pushing up the cost, but Sony seems to be trying to convert the machine into a gaming console + entertainment hub. Towards this end, the upgrade version 1.80, available on 24 May 2007, will allow those users having a HDMI compatible hi-def TV to upscale PS1 and PS2 games and DVD movies to a full 1080 resolution (HDMI refers to the capacility for transmitting high-definition signals. Refer this article:

The 1.80 firmware update coming to the PlayStation 3 on Thursday will allow PlayStation 3 users to upscale earlier PlayStation games to 1080p resolution on HDMI-capable TVs, and will also give users the ability play images, music, and video that are stored on DLNA-enabled devices connected to a home network.
"The capability to upscale DVDs to HD quality is a feature normally only associated with top-range DVD players," Sony said in a statement, "and its inclusion in the latest firmware upgrade now allows PS3 owners with an existing DVD collection to dramatically enhance the viewing pleasure of their DVD collection when viewed through a compatible HD TV set."
In addition, on a home network, upgraded PlayStation 3s will be able to play images, music, and video that are stored on DLNA-enabled devices anywhere in the home. DLNA, offered in such devices as PCs or laptops, is the Digital Living Network Alliance standard for sharing content between consumer electronics devices.
The PlayStation 3, while a technological powerhouse, has had its ups and downs. Last week, Sony announced that its video game business would lose about $413 million this fiscal year, and that it won't recover until there are more PlayStation 3 games. Through March 31, it had shipped 5.5 million PlayStation 3 machines, not quite hitting its target of six million.

This could be a smart move, as long as this does not lead to a lowering of the pitch for the gaming console (potential customers should not get confused about the abilities of the gaming console).
With a move towards more high-definition TV's, and if Blu-ray becomes the next big thing in hardware players, Sony is trying to get into customer looking at its devices as not only a gaming console, but something that is usable by more family members.
However, will this move go unchallenged ? Expect Microsoft to add more ability to the Xbox, and given that this attempt to make it as an entertainment hub will directly attach the concept of the Media center, there could be many more movements in this market.