With the next generation of consoles supposedly looming, Sony finds itself in an interesting place. The PlayStation 3 has only really recently hit its stride, with its life-cycle likely to be extended later this year when it inevitably reaches $199.

As such, the Japanese giant could do with holding off the next generation for another couple of years – but Colin Sebastian of analyst firm RW Baird believes the company needs to act as quickly as possible with PS4.

He said in an interview with Games Industry:

Sony is in a tough position. In many areas of their business, they are losing share, such as TVs and computers, and their challenges are well known in gaming.

The need to invest in a significant upgrade cycle for PS4 comes at a awkward time for Sony, but to remain competitive longer term in games, we think there needs to be another price reduction on the PS3, and then be first to market with a next generation console.

Rumours regarding the next PlayStation have been rife in recent weeks, with some sources stating that the system is codenamed Orbis internally. While many of the reports conflict each other, there does appear to be some convergence over a 2013 date – with one insider claiming that Sony is confident it’s going to beat Microsoft's next console to market.

But it’s still not clear how an earlier than expected release would benefit Sony, with a strong software catalogue and competitive price point also required. Regardless, there’s no doubt that if Sony could check both boxes and beat the next Xbox to market, it would have an incredibly strong basis to build on.

[via gamesindustry.biz]