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Forums - Sony Discussion - Pachter says PS4 will sell at a small profit for Sony, GTTV

Purple said:
Considering the price of the XBox One, it seems highly unlikely Sony are making a profit on each unit sold...


Kinect 2 cost is estimated at a 100$ or more



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MoHasanie said:
Nope, they are probably breaking even or making a loss.
I think I read somewhere that the Xbox One will be profitable from the start.


They have to, Xbone is mase to be buy by people who don't buy video games too.



I think both consoles will be making a small loss to begin with. But I think it will be much like the Wii-u, that it wouldnt take a lot to put it into profit.

For example, when i buy a Ps4, I will probably buy another controller (profit), get an additional year of PS+ (profit) and some games (profit) and probably the camera (profit).

The Xbox is going to do the same to make its money back (i.e gold, controller, games).

Accessories were certainly the way for companies to make money back, and I think us more hardcore (day1) will be buying lots of stuff which in turn will help. The problem with the PS3 was that it was losing $00's of dollars per purchase, which couldnt be made up by early adopters.



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Vinniegambini said:
bananaking21 said:
Vinniegambini said:
Small loss - http://gengame.net/2013/05/sony-ps4-will-not-sell-at-a-major-loss-like-its-predecessor/


that article is pretty old, it published on may 9th

This was at Sony's earning call. They know their profit margins. I will take that over Patcher's word.


of course i would take it over pachter, but dont they know how things will cost exactly once they start mass production? 



bananaking21 said:

of course i would take it over pachter, but dont they know how things will cost exactly once they start mass production? 

I cannot be 100% sure about this, but i was under the impression when you go to manufacturer you sign a contract with the proccesing plant for the cost of the parts.

So i would suspect they know the number of machines they are going to make in a set period and so can do the mass bulk purchasing of goods now. So i think they *will* know the cost... if they are close to mass production that is :)



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Madword said:
bananaking21 said:

of course i would take it over pachter, but dont they know how things will cost exactly once they start mass production? 

I cannot be 100% sure about this, but i was under the impression when you go to manufacturer you sign a contract with the proccesing plant for the cost of the parts.

So i would suspect they know the number of machines they are going to make in a set period and so can do the mass bulk purchasing of goods now. So i think they *will* know the cost... if they are close to mass production that is :)


thanks for that clarification, it makes more sense.



RolStoppable said:
What we shouldn't forget is that there were also quite a few discussions regarding PSV costs. Back then people were also suggesting that it's sold at a profit or at worst at a tiny loss. Plus apparently costs would come down fast, because the system is using standard cell phone parts or something like that. Yet here we are 1.5 years later and Sony still refuses to announce a long overdue price cut in America and Europe to spur hardware sales.

People repeatedly underestimate the costs of video game systems, so why should the PS4 be any different? The system is sold at a loss, no ifs and buts. Just like the PSV had proprietary memory cards as a sign that Sony is trying to offset losses on the hardware itself, so does the PS4 have paid online multiplayer. Instead of guessing the bills of materials, people should look at what a company does. If the PS4 was selling at a profit, then why would Sony give up a major selling like free online multiplayer?

Even if it sold at a profit, the money Sony will need to spend this gen on servers is immense. Cloud computing isn't free ya know and Sony needs a way to support these costs long-term, hence the mandatory PS Plus sign-up, there's no way a tiny profit on console sales could pay for the server costs.



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RolStoppable said:
What we shouldn't forget is that there were also quite a few discussions regarding PSV costs. Back then people were also suggesting that it's sold at a profit or at worst at a tiny loss. Plus apparently costs would come down fast, because the system is using standard cell phone parts or something like that. Yet here we are 1.5 years later and Sony still refuses to announce a long overdue price cut in America and Europe to spur hardware sales.

People repeatedly underestimate the costs of video game systems, so why should the PS4 be any different? The system is sold at a loss, no ifs and buts. Just like the PSV had proprietary memory cards as a sign that Sony is trying to offset losses on the hardware itself, so does the PS4 have paid online multiplayer. Instead of guessing the bills of materials, people should look at what a company does. If the PS4 was selling at a profit, then why would Sony give up a major selling like free online multiplayer?

Is free MP really a selling point ?

I get the impression Sony regrets every single day of PS3's life for not charging for MP.   Maybe they didn't think a paid service like XBL could be so popular and generate MS money.



Making hardware is expensive, making games is expensive, supporting servers etc. This is all money that is needed to be made before making a profit.

I for one are happy that Sony is charging for psn+ as a standard, because perhaps a stronger more financially stable Sony gaming devision will mean even more great things for the PS.

Just think they get 40 million plus subscribers, each year they will generate 1.6 Billion. This is too important for Sony to ignore imho. I agree with Zumnupy10, that Sony probably regretted it, thats why they brought out PS+ as a future system they could trial/test for PS4.



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This confirms that the PS4 will not sell for a small profit.



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