Isn't the reality that MS isn't performing either? No software / technology company is doing well right now and im sure once MS's figures are out the suggestion of more price drops will look ludicrous to investors.

and this thread title is the worst troll bait ive ever seen. Thats why PS fans are freakin out

@Snake

Although Sony is a very large company, over the past several years their operating profits have only (typically) been in the $1 Billion range. When you start talking about several years worth of profit erased in a single year it is not a good sign.

Now, how this is important to gaming really depends on how Sony reacts to this ... Many companies in similar positions in the past have decided to sell divisions of the company to generate capital to offset their operating loss; in the current economic climate the divisions within Sony that would sell for a good price are fairly limited, and if Sony decided to sell game developers (as an example) the only developers that would generate the income they would require would be some of their best developers (that produce games you would want). At the same time, if Sony decided to focus on increasing their ROI they would probably cut back dramatically on the scale of most of their upcomming projects and only produce games with very high sales potential; I could be wrong but I suspect that many of Sony's upcomming games would suffer if their budget was cut in half.

Why are you being a complete troll?

It's flaming just when someone makes tragical predictions without foundantions as I said before. All we are concerned about the financial situation of Sony, but a 16 years old gamer is not the right person to speak about it.

It's my opinion if you don't agree I'm ok with that.

no, Microsot hasn't announced any layoffs.  I'm sure Microsoft is being hit by the recession but not nearly as much as Japanese companies that rely on exports.  The yen is just way to strong right now for Japanese companies to compete with the prices of companies from other countries.

When a publically traded company makes a profit, the money is split in two ways: either it is kept inside the company for reinvestment, which boosts the company's value, and therefore the shareholders' stock value goes up; or it is paid directly to the shareholders as a dividend.  Usually companies will keep some of the money and pay out the rest.

There's no question that if MS actually wanted to it could sell every xbox360 for $100. However, they are under extreme pressure as well to increase margins. So the question becomes, how high a priority do you think the xbox division is at MS? From ex-Managers at MS I've talked to, their financial organisation is very similar to that of the Soviet economies complete with their own fake currency to facilitate the meeting of planning targets.

I can see buyers for some of their Intellectual Property. However who wil buy their factories for more than peanuts in an economy where most companies are trying to save cash and decrease production rather than increasing it?

Sony is a huge company so that question is too complicated to examine quickly, we'll just have to wait and see what they can do.

One big problem for them is that restructuring takes about a year to pay off (as the FT article says, for every fired employee, severance pay is usually needed). One can't imagine the complexity of restructuring a company in a short period, I think we're going to read things we can't even imagine right now.

You could easily argue that Microsoft will never have a better chance then they do now to put the dagger in Sony.  They have an unfair advantage right now because they are not as affected as Sony by the exchange rates and they have far more resources.

Yea, its a complicated time at the moment. We should all hope Sony gets it together.

On top of all this ive just heard that:

Boeing is cutting 4,500 jobs, Land of Leather- a british furniture retailler has gone into administration and JCB is cutting more jobs.

I really dont like the look of what this world will be like once this recessions over