TheBigFatJ said:
All the while Sony was making huge profits. That would basically like the PS3 getting a price cut to $249 last April and making a huge profit for Sony. What we're observing here is two things:
(1) The PS3 cost a lot more than the first Playstation to produce. Sony took much larger losses
(2) Sony could not cut prices, even percentage wise, nearly as fast for the PS3. Production costs are probably decreasing more slowly.
(3) These two points above will likely conspire to break the Playstation Brand's "10 year life span"
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One of the key differentiators here is that much of the PlayStation was already developed under license for Nintendo. The "R&D" that went into the original PlayStation looks a lot less like "Research & Development" and more like "Buy off-the-shelf from the lowest bidder and solder together." The entire CD assembly was molded out of plastic, for crying out loud! Sony was shipping dev kits on the PlayStation 18 months ahead of its Japanese release. Comically, Sega was admonishing developers that were considering the PlayStation, because the Saturn was going to be far more "hardcore" while the PlayStation was going to be the "kiddie" system.
"It doesn't take a lot of technical expertise to program for the PlayStation. There's really more to our system. We have a complicated development system."
-- Thomas Kalinske, Sega of America CEO
Oh ... the irony!
