PS3 Price Cuts or Bust

[Harakiri]

The Sony Playstation 3 is selling less and less units due to it's high cost. Sony refuses to cut the price though due to production values being through the roof. 4.4 billion dollars of operating losses have been collected over the past 3 years, and Sony is failing to understand the fact that they are screwing themselves either way they go.

 

Price Cuts= Sony has a chance of getting tons more people to buy the console, but that probably won't happen.

 

Keep the Price=Sony has no chance of getting more people to buy the console.

 

Activision is going to quit producing games for the console if there is not a price cut:

 

 

 

http://www.bloomberg.com/apps/news?pid=20601101&sid=arABB6Q8eodU

 

July 8 (Bloomberg) -- Sony Corp. Chief Executive Officer Howard Stringer spurned calls by Activision Blizzard Inc., the worlds largest video-game publisher, to cut prices of the PlayStation 3 because the $400 console is unprofitable.

 

 

 

Activision CEO Bobby Kotick said last month the publisher of the Guitar Hero and World of Warcraft games may shift away from developing products for Sonys PlayStation 3 toward cheaper machines by competitors of the Tokyo-based company.

 

 

 

He certainly likes to make a lot of noise, Stringer, 67, said in an interview yesterday in Sun Valley, Idaho. I lose money on every PlayStation I make.

 

 

 

Daniel Dematteo, head of GameStop Corp., the worlds largest video-game retailer, said during a company earnings call in May that console prices are too high given the economic environment. Revenue in the U.S. video-game industry has fallen for three consecutive months, according to data compiled by research firm NPD Group Inc.

 

 

 

Sony dropped 1.9 percent to 2,310 yen as of 1:37 p.m. in Tokyo trading, bringing this years gain to 20 percent. Japan- based Nintendo Co., which makes the Wii, the best-selling game console, has slumped 21 percent this year, and U.S.-based Microsoft Corp., the maker of the Xbox, has climbed 16 percent.

 

 

 

The PS3 trails the Wii and the Xbox 360 in sales. The Wii sells for $250 and the least expensive Xbox costs $200. Sony cut the price for the PlayStation 3 in the U.S. in July 2007 and in Japan in October that year, when it introduced a new model.

 

 

 

Price, Sales

 

 

 

Price cutting hasnt always contributed to increased sales, Osamu Hirose, an analyst at Tokai Tokyo Securities, said today by phone. He rates the shares above average.

 

 

 

The game unit has been Sonys biggest money-loser during the past three years, accumulating 415.3 billion yen ($4.4 billion) of operating losses. The deficits began after Sony introduced the PlayStation 3 in the fiscal year started April 2006. Operating profit is measured as the value of sales minus the cost of goods sold and administrative expenses.

 

 

 

Were very happy with the price point that we have, Kazuo Hirai, the head of Sonys game division, said during the Electronic Entertainment Expo trade show in Los Angeles on June 3. We will move when we think its appropriate at some point in time.

 

 

 

Sony, which invested about 200 billion yen to develop the PS3s central processor, plans to replace the consoles main chip with a 45-nanometer model from 65 nanometers, Daisuke Nakata, a spokesman for the game unit, said today by telephone, without specifying when the upgrade would be released.

 

 

 

New Chips

 

 

 

A nanometer is one-billionth of a meter and measures the width of the transistors packed in a semiconductor. The new chips will be smaller, and such models usually generate less heat, enabling a reduction in the number of components and leading to lower costs, Nakata said.

 

 

 

Ashley Dyer, a spokesman for Activision Blizzard, didnt immediately return a message left by Bloomberg News seeking comment after regular business hours in Santa Monica, California.

 

 

 

Hes putting pressure on me and Im putting pressure on him, Stringer said of Kotick. Thats the nature of the business.

 

 

 

 

Despite pretty much everyone who doesn't own a PS3 but wants ones prayers, Sony continues to tell people that they will not see a price cut. Instead, we will see the PSPGO and talk of a new slim PS3 is making people wonder is Sony actually understands that they are digging an inescapable hole.

 

According to this article, Sony is telling everyone that the PS3 is looking at the long term, at the next ten years. They say that they will pick up consumers slowly over the next decade of production.

 

Once again I have to ask if they understand that with production values as high as they are and income as low as it is, do they understand the hole they are digging. So basically: "We are slowly grabbing thirty consumers every six months. So who needs a price cut"?

 

In related Gamestop news which I saw on G4's The Feed today, Gamestop is striking at Sony telling them that if there is not a price cut soon, they will stop selling the system.

 

What happens if there is no price cut?

 

-Activision Blizzard, creators of the greatest RPG's and Guitar Hero will quit making games for it.

 

-Gamestop will stop selling it, gamestop/EBgames being the largest chain of video game stores around.

 

-PS3 loses more money than ever before and production might have to stop.

 

The PS3 Slim, if the rumor is true, would go for 300 dollars, which is the price cut a lot of people might be looking for, maybe not, but the question is this:

 

 

 

If a producer of games for the console, and a major distritibutive entity decide to quit working with the console if there is not a price cut, can Sony get their act together and find a way to get out of this hole?

 

 

 

Discuss whatever, but let's keep the console bashing stuff to a minimum because I know someone will decide to bash the console itself. That's not what this thread's about...I'll update this when necessary, but I have no idea what to say about Sony. So many companies refuse to make exclusives for the console, there are very few first party titles compared to other systems, there are a lot of things Sony needs to fix, or quite frankly, they are screwed.

[Michael]

I read about this a few weeks ago and was quite intrigued, will be interesting to see how this plays out.

[Nadril]

Oh no, no more Activision games!

 

 

 

I would like to see a PS3 price cut though, the console has a lot of titles I'm interested in. Of course I don't have much money at all right now anyways, so I don't think it matters either way.

[PoorLepRecon]

There are tons of rumors about a PS3 price cut and a PS3 slim being announced in the coming months. We will have to see if they are true. As of now, I do agree that they need a price cut, as it was what deterred me when deciding between a PS3 and a 360 about 4 months ago.

[Mr_Adam]

Even if there is a price cut, I won't buy it until it's backwards compatible. There are too many good PS2 games (even if I only have 4 or 5 of them).

[nerdattack16]

Even if there is a price cut, I won't buy it until it's backwards compatible. There are too many good PS2 games (even if I only have 4 or 5 of them).

 

I thought some of the models were backwards compatible. I know mine isn't but I thought the 60GB was.

 

 

 

This seems like dire news for Sony. One of the main reasons I got a PS3 (other than a few of the games) was that I wanted a Blu-Ray player too and it only cost me $250. Sometimes now I occasionally regret not getting a 360 but I'm still happy with the PS3. Unfortunately for Sony, not many people are left on their side - for example, in my group of 20-30odd friends or so, there are at least fifteen 360s, twenty Wiis.... and I'm the only PS3 owner. And none of them would be remotely interested in getting a PS3 unless it gets cheaper.

[Giordano]

Ahh, just let Sony keep their prices. Then release the PS4 and make NO money at all. It's what they get, those idiots.

[Harakiri]

Ahh, just let Sony keep their prices. Then release the PS4 and make NO money at all. It's what they get, those idiots.

 

 

 

The problem is if they can't get the PS3 to work out, there won't be a PS4. And they expect the PS3 to last for another ten years. I really hope they are kidding because gaming better evolve past the graphics and limitations it has now in ten years.

[nerdattack16]

Ahh, just let Sony keep their prices. Then release the PS4 and make NO money at all. It's what they get, those idiots.

 

 

 

The problem is if they can't get the PS3 to work out, there won't be a PS4. And they expect the PS3 to last for another ten years. I really hope they are kidding because gaming better evolve past the graphics and limitations it has now in ten years.

 

Man, more evolution? It seems like every time a new console comes out, it just keeps getting exponentially better... and I keep thinking it can't get any better.

 

 

 

Don't forget that the PS2 has lasted ten years. I still bust out some DDR, Ratchet and Clank, and Kingdom Hearts on mine and I've had it for almost eight years. The PS3 has the potential to last ten years, at least.

[3rkid]

I've got COD5 and going to have COD:MW2 in November. If Activsion drops the PS3, I'll still have those two great games to play, so I'm set.

[RayOxide]

Sony are pretty fail. The PS2 wasnt abov average for its time.. Or when i got one anyway, and it was a massive success. All you need are average graphics, great games and a great selection. And a hard drive adn HD for now.

 

But Sony and their attempts to live in 2020 suck

[3rkid]

Sony are pretty fail. The PS2 wasnt abov average for its time.. Or when i got one anyway, and it was a massive success. All you need are average graphics, great games and a great selection. And a hard drive adn HD for now.

 

But Sony and their attempts to live in 2020 suck

 

 

 

Funny how you insulting Sony for being too advanced is like a [developmentally delayed] making fun of Einstein. (Nintendo and Sony)

[Verminox]

Even if there is a price cut, I won't buy it until it's backwards compatible. There are too many good PS2 games (even if I only have 4 or 5 of them).

 

 

 

There are rumours of backwards compatible coming in a firmware update.

 

 

 

Activsion think the console is expensive, have they seen the price of their plastic peripherals.

 

 

 

Sonys comment on the issue:

 

 

 

"PlayStation has tremendous momentum coming out of E3, and we are seeing positive growth with more than 350 titles slated to hit across all our platforms, including many anticipated games from our publishing partners," said Playstation spokesman Patrick Seybold. "We enjoy healthy business relationships with and greatly value our publishing partners and are working closely with them to deliver the best entertainment experience."

 

I couldn't care less if activision quit, the PS3 has a great game lineup for 2009/10. If activision stop for PS3, then what would we lose Guitar Hero, Tony Hawks, Call of Duty.

[RayOxide]

Sony are pretty fail. The PS2 wasnt abov average for its time.. Or when i got one anyway, and it was a massive success. All you need are average graphics, great games and a great selection. And a hard drive adn HD for now.

 

But Sony and their attempts to live in 2020 suck

 

 

 

Funny how you insulting Sony for being too advanced is like a [developmentally delayed] making fun of Einstein. (Nintendo and Sony)

 

 

 

Lol I rather Sony over Nintendo :|

 

 

 

EDIT: Is that 4 current 'No Reason' anti-wii boy bandwagoners?

 

Atleast one person was smart enough to drop off of it.

 

 

 

And I dont really care if Activision quit either.

[Danqazmlp]

That's the reason i got a 360 and not a Ps3, double the price for what isn't double the computer.

[3rkid]

That's the reason i got a 360 and not a Ps3, double the price for what isn't double the computer.

 

 

 

Meh, I like my free online and watching my newly bought Blu-ray movies. Oh wait! The 360 has an HD-DVD reader. :lol:

[Verminox]

That's the reason i got a 360 and not a Ps3, double the price for what isn't double the computer.

 

 

 

Even though the Cell in PS3 is faster than the top Intel CPU (Core i7 965 XE).

[Danqazmlp]

That's the reason i got a 360 and not a Ps3, double the price for what isn't double the computer.

 

 

 

Meh, I like my free online and watching my newly bought Blu-ray movies. Oh wait! The 360 has an HD-DVD reader. :lol:

 

 

 

I'd rather pay to go online when i can play my friends, as i know one person with a ps3, and about 6 who have 360's, and i think some of them were priced out aswell. For the average late-teen who might be thinking of buying a console, the extra between the 360 and ps3 is a major thing.

 

 

 

Oh and verminox, i mean console, i just use the word computer instead of console...

[Hobgoblinpie]

The reason the Xbox works is because of the business model Microsoft uses. The console is sold at a loss, and profit is recouped from Game sales and most importantly, online subscription. This is where the PS3 falls down. Expensive already (and it still looses money), free internet use and high game development costs.

 

 

 

I'm not bashing the PS3, I'm just saying that Sony has approached the market with a defunct business model, which may lead to the early death of the PS3.

 

 

 

But, the PS3 is still one of the cheapest Blu-Ray Movies players, which may be a factor in the sales slowly (and not rapidly) declining.

[Michael]

The reason the Xbox works is because of the business model Microsoft uses. The console is sold at a loss, and profit is recouped from Game sales and most importantly, online subscription. This is where the PS3 falls down. Expensive already (and it still looses money), free internet use and high game development costs.

 

 

 

I'm not bashing the PS3, I'm just saying that Sony has approached the market with a defunct business model, which may lead to the early death of the PS3.

 

 

 

But, the PS3 is still one of the cheapest Blu-Ray Movies players, which may be a factor in the sales slowly (and not rapidly) declining.

 

 

 

You can buy Blu-Ray players for £150, that's half the price of a PS3.

[Seraphi]

I always said that making the console so expensive was a surefire route to failure.

 

This is why the Nintendo Wii dominates the market.

 

Its affordable, as well as innovative.

 

And of course, not forgetting the Xbox, which is also affordable.

 

People would much rather go for the cheaper consoles.

[RayOxide]

I always said that making the console so expensive was a surefire route to failure.

 

This is why the Nintendo Wii dominates the market.

 

Its affordable, as well as innovative.

 

And of course, not forgetting the Xbox, which is also affordable.

 

People would much rather go for the cheaper consoles.

 

 

 

Not to mention that the Xbox isnt that far off of the PS3 graphics..

 

Well, from what I've seen on my friends GTA4 (Xbox) and my brothers GTA4 (PS3)

[Hobgoblinpie]

Not to mention that the Xbox isnt that far off of the PS3 graphics..

 

Well, from what I've seen on my friends GTA4 (Xbox) and my brothers GTA4 (PS3)

 

 

 

Not yet anyway. A games company mentioned that the PS3 is much more powerful, but games developers haven't tried pushing it yet. Either that or they're lying. But, there is no denying it, Xbox 360 games do look very good.

[indy500fan]

You can buy Blu-Ray players for £150, that's half the price of a PS3.

 

 

 

The cheap Blu-ray players may not be profile 2.0. £150 is around $242US, you can find stand alone players for around $200 here. If you just want a BD-ROM drive for your computer (can play movies too of course) you can get one for as cheap as $80. If your computer is good enough and you have it hooked up to a TV that isn't a bad way to go.

 

 

 

I'm not worried about a price drop on the PS3 because I already got one. I probably should have waited, I just really wanted to see Firefly on Blu-ray, and it is a good Blu-ray player. I just wish games weren't so expensive, I would like to be able to get one :) .

[Kiriyama]

I always said that making the console so expensive was a surefire route to failure.

 

This is why the Nintendo Wii dominates the market.

 

Its affordable, as well as innovative.

 

And of course, not forgetting the Xbox, which is also affordable.

 

People would much rather go for the cheaper consoles.

 

 

 

Not to mention that the Xbox isnt that far off of the PS3 graphics..

 

Well, from what I've seen on my friends GTA4 (Xbox) and my brothers GTA4 (PS3)

 

 

 

Yeah, why don't you actually compare two exclusive games released around the same time for a better comparison.