Sony misses out as PlayStation fails the computer test

Sony appeared yesterday to have lost a long-running battle to get its popular PlayStation 2 games console recognised as a personal computer - a move that could have netted it millions of euros in back customs duty.

The Japanese electronics group argued that the machine was every bit as sophisticated as a computer, contending that it contained a PC-comparable microprocessor which allows it to process data just like a computer.

Sony was not splitting hairs for the sake of hair-splitting; its motives were purely mercenary. The import tariff for computers coming into the European Union is much lower than that for games consoles and a ruling that the PlayStation 2 was a computer could have forced customs authorities to pay back millions in duties.

Europe's court of first instance in Luxembourg ruled against Sony yesterday saying that the definition of a computer could not be stretched for commercial reasons to include a PlayStation. "It is quite clear that it is intended mainly to be used to run video games."

The machine would have to be reclassified because of a legal technicality but with no effect on its tariff status.

The European commission, which classified the machine as a games console, said it was satisfied with the decision while Sony played down its disappointment.

The bizarre legal battle is about to be overtaken by events anyway. From January 1 of next year computers and games consoles will be allowed into the EU at zero tariff.

Yesterday's ruling coincided with a surprise announcement from Sony that it would drop the price of the PlayStation 2 in Britain by £30 to £139.99 in the run-up to Christmas.

The move, which executives said was designed to bring the UK into line with the rest of Europe, will make the Sony machine more competitive compared to its two rivals - Microsoft's Xbox and Nintendo's GameCube.