CHIBA, Japan (Reuters) - Sony Corp (6758.T) said on Thursday it would postpone the launch of the "Home" virtual community service for its PlayStation 3 game console to early next year, the latest setback in its videogame battle with Microsoft Corp (MSFT.O) and Nintendo Co Ltd (7974.OS).
 The 3D "Home" online service, in which players can create and "own" characters and content, was originally scheduled for launch this autumn.

Sony Computer Entertainment, the video game unit of Sony, said it was postponing the launch to improve product quality.

"This is going to be a worldwide service that needs to offer a wide range of functions required in Japan, in the U.S., in Europe and in Asia," Sony Computer Entertainment (SCE) Chief Executive Kazuo Hirai said in a keynote speech at the Tokyo Game Show 2007.

"We aim to launch this as something that can meet expectations of people all over the world."

Hirai did not mention widely anticipated price cuts for the PS3, instead saying the firm plans to strengthen its software lineup to attract users.

As part of that effort, SCE said it has acquired British software developer Evolution Studios and its subsidiary, Bigbig Studios, for an undisclosed sum.

Evolution created "MotorStorm," a million seller title for the PS3.

Sony's PlayStation and PlayStation 2 dominated the global game industry for about a decade from the mid-1990s, but Sony was one year behind Microsoft in releasing its latest console. The PS3 has lagged far behind Nintendo's Wii in monthly sales due to a lack of hit game products and its high price.

On the hardware side, SCE said it would offer a new controller with a vibration function for the PS3.

The price for the new controller, which will become available in November in Japan and next spring in North America and Europe, was not immediately available.

Sony has packed the PS3 with cutting-edge technology such as the Cell chip, dubbed "supercomputer on a chip," and Blu-ray high-definition DVD player.

Those advanced functions make the PS3 capable of offering life-like graphics and high-speed downloading from the Web, but they have also driven up manufacturing costs.

The PS3 with a 20-gigabyte hard disk drive sells for 49,980 yen in Japan, roughly twice as much as Nintendo's Wii.

Shares in Sony were down 1.3 percent at 5,420 yen in late afternoon trade, underperforming the Tokyo stock market's electrical machinery index (.IELEC.T), was down 0.5 percent.