Sony's online-games division said yesterday that it has opened a development arm in Bellevue, hiring a group of ex-Microsoft game creators to run the studio.

Sony also said Ed Fries, the former head of Microsoft Game Studios, will be an adviser to the group and will help with game design and studio management.

The team will work on developing so-called massively multiplayer online games, which generally involve a vast and complex virtual world in which players interact with each other over the Internet. Sony has been the leader in this area, and its "EverQuest" is one of the genre's leading titles.

While at Microsoft, several team members had worked on a role-playing game called "Mythica," which the company dropped in mid-development last February. Microsoft also cut a few dozen positions from Game Studios in the process, saying that after evaluating the gaming landscape, it decided to reduce investments in the genre.

Matt Wilson, now executive producer of Sony's Bellevue studio, was one of the "Mythica" developers. He left Microsoft last April and founded a small gaming startup called FireAnt with some former colleagues.

"I wanted to make sure that I was still pushing on the [massively multiplayer] space really hard, and I just felt like Microsoft wasn't the place that was going to be focusing on that effort," he said.

Fries left Microsoft in January 2004, saying he wanted to stay in the game business but was looking for more balance in his life. He joined FireAnt last year. The team began talking with publishers, and by November, Sony had hired everyone but Fries and launched what it is calling Sony Online Entertainment-Seattle.

The group worked out of friends' offices for months and only recently moved to a 10,000-square-foot office in Bellevue near the Kirkland border.

Fries decided to serve as a consultant and let the team have his Segway scooter to ride around the office.

The company has the resources to help with the development of massively multiplayer games, Wilson said.

"Sony is also really interested in wanting to continue the innovation in that space," he said. "I think we wanted to be with a partner that was willing to take some risk and not just do the same old thing."

All seven in the team have worked at Microsoft. Sony plans to hire five more people for the studio by April and ramp up to 30 in the next year.

Wilson said he was flooded with résumés and phone calls yesterday within hours after Sony announced the new studio.

"The talent pool inside this area is huge," he said.

The studio isn't saying what games it will develop or what platforms they will be played on. Massively multiplayer games have traditionally been played on the personal computer, but lately some have moved over to video-game consoles such as Sony's PlayStation 2.

The studio's games could find a home on Sony's upcoming handheld game device, the PlayStation Portable, or on Sony's next-generation PlayStation console, which is expected to debut by next year.

With hundreds of thousands of game-playing subscribers willing to pay monthly fees, developing multiplayer games can be a compelling investment for companies, said Schelley Olhava, an analyst covering the video-game industry for IDC. But so far, many games in the category have the same look and feel, she said.

"The potential is there," she said. "We need to think a little differently about how we create games in this space and who are we really targeting."

Kim Peterson: 206-464-2360 or kpeterson@seattletimes.com

March 24 release set for PlayStation Portable in North America

SAN JOSE, Calif. — Sony said yesterday that it will release the PlayStation Portable (PSP) in North America on March 24 and have 1 million units ready for sale in the first week.

The PSP machine, a challenger to Nintendo's long-standing grip on the handheld video-gaming market, will be sold as a "value pack" for $250. It will include numerous accessories and — for the first million sold — a copy of the "Spider-Man 2" movie on the new Universal Media Disc (UMD) format that Sony designed for the PSP.

Sony said it has shipped 800,000 PSPs in Japan, where it went on sale Dec. 12 for about $190.

By comparison, Nintendo's newest product, the Nintendo DS, sells for $150. It was among the must-have Christmas gadgets, with more than 2.8 million sold worldwide since its release in late November.

The PSP is designed with more multimedia features. It can play digital music, movies and display photos on its 4.3-inch color screen, using Sony's proprietary 1.8-gigabyte UMDs or a Memory Stick.

With the PSP, the Tokyo-based electronics giant is targeting a wider consumer base, not just young gamers.

"It has gaming at its core, but it's not a gaming device. It's an entertainment device," said Kaz Hirai, president of Sony Computer Entertainment America.

In addition to working with its Sony Pictures film division, Sony is in discussions with other movie studios to support the new UMD format for future releases of movies, Hirai said.

Sony said 24 game titles will be available around the time of the launch, with prices starting at $40 each.

According to market-research firm DFC Intelligence, the DS and PSP are expected to drive the global portable-games market from $3.9 billion in 2003 to $11.1 billion in 2007. The overall global video-game industry saw sales of about $23 billion in 2003.

Hard-core gamers will propel the initial sales of the PSP, analysts say. Its unique combination of gaming and multimedia features in a 7-inch by 3-inch device that also has Wi-Fi, could spur a new market for Sony.

"When it comes to entertainment, Sony has advantages over other players," said P.J. McNealy, an analyst at American Technology Research.

— The Associated Press