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Retailers Demand PSP Price Drop

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MS technically makes a profit on hardware (at least the 400 SKU), but XBox as a whole is still in the red. There was speculation that all the losses of the division were from Zune at this point, but Peter Moore is still talking about acheiving profitability, and he has nothing to do with Zune. He's said something along the lines of "making a small profit on each console sold doesn't mean anything if we spend 100 dollars in advertising to get that sale." XBox should become profitable as a whole within 6 months, but there's a similar timeframe on a price cut. Hopefully, for their own sake, cost reduction goes off perfectly, because it'd be a shame to cut the price and create another 6 months of red ink. PSP appears to be doing okay, but look at the year over year sales. PSP launched in March of 05... In the Mar-Dec period of 05 and 06, the 06 sales were only higher in two months... In the key month of December, sales were about 150K lower in 06... For the DS, sales got better every month of 06 over the comparable month of 05, usually by a ton... To put the sales acceleration another way... DS launched 4 months before PSP, including a better launch and an Xmas season... Yet DS crossed the 4 million sold mark in NA in Dec 05 and PSP hit the mark the next month, nearly catching up... Today, PSP is yet to reach 8 million in sales, while DS just reached 11 million, and could blow by 12 million as soon as Pokemon hits. Looking WW, while PSP has sold 20 million in just over 2 years, its looking unlikely it will reach 30 million in another year, while DS could get to 60 million in the same time frame. So you can see why retailers might be irked. PSP appears to be losing steam, its being outperformed by several systems, and being smashed by its main competitor. Yet it costs as much to stock as it did when it was a hot item.



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kber81 said: Sintinel said: Actually, MS broke even on the 360 about 9 months ago, and have been making a profit on them since a little after that. "The PS2, meanwhile, long ago turned profitable as component prices have plunged and development costs have been written off. Even at $130 a pop, Sony earns about $8 on each PS2 it sells, compared with an estimated loss of $250 per PS3. (Nintendo is believed to break even on the Wii, while Microsoft takes a loss on the Xbox 360.)" - Source - December 28 2006
http://arstechnica.com/news.ars/post/20061116-8239.html
It's a gloomy picture, but there is light at the end of the tunnel. When iSuppli tore down an Xbox 360 around this time last year, the firm estimated that Microsoft was losing $126 on each 360 sold. Microsoft is whistling a much happier tune now. Revised component costs for the Xbox 360 indicate that costs have dropped to the point where each $399 Xbox 360 sold costs $323.30 to make—leaving Microsoft $75.70 in the black on each system, before marketing and other costs are figured into the equation.
November 16, 2006 This source is credible enough to be used for Wikipedia's article on the Xbox360.
The strategy of selling a console at a loss or near-loss is common in the console games industry, as console makers expect to make up the loss through game licensing. Since Microsoft owns the intellectual property rights to the hardware used in the Xbox 360, they can easily switch to new fabrication processes or change suppliers in the future to reduce costs. Thanks to streamlined processes and ample component supplies, a report from iSuppli released on November 16, 2006, estimates the total cost of components in the premium bundle is US$323.30.



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I think the point was the 360 was not profitable 9 months ago. Also Wiki is not a great source, they often aren't up to date.



Sintinel said: By the way ,seeing as it sells about as much as the X360 and it wastes much less shelves space do you think retailers will force Microsoft to price cut the X360 as well ?? I am a bit tired of all these fake news .... No because people actually buy games for the Xbox 360. Retailers don't make much money on hardware, they make it all on games and accessories. The Xbox 360 sells a helluva lot of both, the PSP, not so much.
360 2,080,750 30,652,750 PSP 1,023,000 29,861,000 Numbers from last month and lifetime in Units. Yeah they do move more, but I don't know about a helluva a lot more. PS2 still moves more than any other system including DS.



Yes, but I don't hear retailers complaining about the PS2. We're talking about the PSP. And I would be willing to bet that most of the PSP sales were from the first year it was out, while most of the 360 sales are from the last 8 months or so when it started actually getting some good games. Right now, at the present time, the PSP is not selling very well in the US. How is this even a point of contention? The retailers are saying as much, and I would expect them to know more about this than anyone else.



It is better to remain silent and be thought a fool than to open one's mouth and remove all doubt. -Mark Twain

2004 Lincoln LSV8 - ~$15,000

K&N Cold Air Intake - $300

Handheld ECU Reprogrammer - $400

The look on a ricer's face when they get their ass beat off the line by a Lincoln - Priceless

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Funny thing is DS hasnt received a single good game in all the year (except maybe Lunar Knights ) while the DS has received Burnout Dominator ,Ratchet & Clank Size Matters ,Sid Meier Pirates ,Call of Duty ,ISS 07 ,Gurumin ,Chili Con Carnage ,MLB 07 ,MLB The Show ,Afterburner Black Falcon ....yet still the DS wins because of the non-games as Nintendogs and Brain Training .I personally dont care wich sells more ,I would like the PSP to sell more but as it is is a perfectly viable plattform and with the kind of software it is receiving I am very happy with it and wouldnt change it for the DS with all its Nintendogs and Pokemons ...no matter if it sells more .



Diomedes1976 said: Funny thing is DS hasnt received a single good game in all the year (except maybe Lunar Knights ) while the DS has received Burnout Dominator ,Ratchet & Clank Size Matters ,Sid Meier Pirates ,Call of Duty ,ISS 07 ,Gurumin ,Chili Con Carnage ,MLB 07 ,MLB The Show ,Afterburner Black Falcon ....yet still the DS wins because of the non-games as Nintendogs and Brain Training .I personally dont care wich sells more ,I would like the PSP to sell more but as it is is a perfectly viable plattform and with the kind of software it is receiving I am very happy with it and wouldnt change it for the DS with all its Nintendogs and Pokemons ...no matter if it sells more .
Thanks for showing us whats up, namely no self respecting gamer buys a DS, it's all those foolish "casuals" who also own PS2's. Good thing the PSP wins in terms of quality because the faux hardcore know that sequels and "mature" games are the shit, and anything fun or innovative is crap. You're right, it doesn't matter which wins and you don't care. In fact, you don't care so much that you make a post claiming the PSP is superior despite it's poor sales. Good thing I don't care soo much that I make a post in response, just to show how much I don't care.



Leo-j said: If a dvd for a pc game holds what? Crysis at 3000p or something, why in the world cant a blu-ray disc do the same?

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sieanr said: Diomedes1976 said: Funny thing is DS hasnt received a single good game in all the year (except maybe Lunar Knights ) while the DS has received Burnout Dominator ,Ratchet & Clank Size Matters ,Sid Meier Pirates ,Call of Duty ,ISS 07 ,Gurumin ,Chili Con Carnage ,MLB 07 ,MLB The Show ,Afterburner Black Falcon ....yet still the DS wins because of the non-games as Nintendogs and Brain Training .I personally dont care wich sells more ,I would like the PSP to sell more but as it is is a perfectly viable plattform and with the kind of software it is receiving I am very happy with it and wouldnt change it for the DS with all its Nintendogs and Pokemons ...no matter if it sells more . Thanks for showing us whats up, namely no self respecting gamer buys a DS, it's all those foolish "casuals" who also own PS2's. Good thing the PSP wins in terms of quality because the faux hardcore know that sequels and "mature" games are the shit, and anything fun or innovative is crap. You're right, it doesn't matter which wins and you don't care. In fact, you don't care so much that you make a post claiming the PSP is superior despite it's poor sales. Good thing I don't care soo much that I make a post in response, just to show how much I don't care.
I said "I dont care while it is a viable plattform " .It is ,and in the software front it seriously smokes the DS .I have been following the game reviews and release schedule of both handhelds and the amount and quality of the PSP software is a lot higher .



Diomedes1976 said: sieanr said: Diomedes1976 said: Funny thing is DS hasnt received a single good game in all the year (except maybe Lunar Knights ) while the DS has received Burnout Dominator ,Ratchet & Clank Size Matters ,Sid Meier Pirates ,Call of Duty ,ISS 07 ,Gurumin ,Chili Con Carnage ,MLB 07 ,MLB The Show ,Afterburner Black Falcon ....yet still the DS wins because of the non-games as Nintendogs and Brain Training .I personally dont care wich sells more ,I would like the PSP to sell more but as it is is a perfectly viable plattform and with the kind of software it is receiving I am very happy with it and wouldnt change it for the DS with all its Nintendogs and Pokemons ...no matter if it sells more . Thanks for showing us whats up, namely no self respecting gamer buys a DS, it's all those foolish "casuals" who also own PS2's. Good thing the PSP wins in terms of quality because the faux hardcore know that sequels and "mature" games are the shit, and anything fun or innovative is crap. You're right, it doesn't matter which wins and you don't care. In fact, you don't care so much that you make a post claiming the PSP is superior despite it's poor sales. Good thing I don't care soo much that I make a post in response, just to show how much I don't care. I said "I dont care while it is a viable plattform " .It is ,and in the software front it seriously smokes the DS .I have been following the game reviews and release schedule of both handhelds and the amount and quality of the PSP software is a lot higher .
Diomedes, let's all agree that your right, that PSP software is much better then the DS software. The reason why it's losing would be because of price.. which is why the retailers are asking for a price drop.



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gebx said: Diomedes1976 said: sieanr said: Diomedes1976 said: Funny thing is DS hasnt received a single good game in all the year (except maybe Lunar Knights ) while the DS has received Burnout Dominator ,Ratchet & Clank Size Matters ,Sid Meier Pirates ,Call of Duty ,ISS 07 ,Gurumin ,Chili Con Carnage ,MLB 07 ,MLB The Show ,Afterburner Black Falcon ....yet still the DS wins because of the non-games as Nintendogs and Brain Training .I personally dont care wich sells more ,I would like the PSP to sell more but as it is is a perfectly viable plattform and with the kind of software it is receiving I am very happy with it and wouldnt change it for the DS with all its Nintendogs and Pokemons ...no matter if it sells more . Thanks for showing us whats up, namely no self respecting gamer buys a DS, it's all those foolish "casuals" who also own PS2's. Good thing the PSP wins in terms of quality because the faux hardcore know that sequels and "mature" games are the shit, and anything fun or innovative is crap. You're right, it doesn't matter which wins and you don't care. In fact, you don't care so much that you make a post claiming the PSP is superior despite it's poor sales. Good thing I don't care soo much that I make a post in response, just to show how much I don't care. I said "I dont care while it is a viable plattform " .It is ,and in the software front it seriously smokes the DS .I have been following the game reviews and release schedule of both handhelds and the amount and quality of the PSP software is a lot higher . Diomedes, let's all agree that your right, that PSP software is much better then the DS software. The reason why it's losing would be because of price.. which is why the retailers are asking for a price drop.
For God's sake it's not only the price!! 110m+ ppl in the world have a PS2! Why bother buying a PSP which just offers ports or sequels? (some exceptions also like FFVII) It's not even like a portable, HUGE loading times, shitty analog stick, and games that you need a lot of time to play. On the other hand the DS has better controls thanks to the touch screen and better buttons, tiny loading times, easy to pick up games, (I never played casual games, i like games like God of War, FF, MGS etc.) and you can't even imagine how many hours i spent playing Cooking Mama and Brain Training! The DS has lower-quality addictive games (with the exceptions of FFIII, the upcoming DQIX and FFXII:RW and some others), while the PSP has better quality PORTS and SEQUELS and games not easy to pick up. (with some exceptions like LocoRoco).