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Forums - Sony Discussion - Sony Strategy Thread: Third Party Sony (PS NOW)

joeorc on 27 November 2009
nordlead said:
LordChris915 said:

I would like to know what Sony has in the Bank and how much of a hit they can afford to take this Gen, they must have loads of PS2 cash sitting around and some cash from the PS1 too I assume.

What money does the PS division get from Sony?

based on that we gould take a guess at how much PS3 development was, how much they can afford to lose, we could do with the definitive manufactuing costs, it may cost $800 to make a PS3, but if they buy in bulk they could have a much better deal than that.

I would also like to know what they are saving on the PS3 slim and what their profit margins are on software sales, without knowing this we cannot know what Sony real financial position is.

 

P.S. I wonder what MS lose on RRoD

They burnt every dime they ever earned on the PS1 and PS2 on the PS3.

nope...lol, not even close..you do know sony sold over 50 billion at retail on just counting the ps1 and ps2, that figure is not even counting the psp #'s 



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

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joeorc on 27 November 2009
LordChris915 said:

If they had 7 generations already planned, maybe it's time to replan given the business failure of the PS3.

 

 

The game isn't over yet and sales are picking up, plus I think that the PS3 has better year-for-year sales, so PS3 failure is a matter for debate.

To think that the 360 launched a year early and had a lead of 9 million consoles, the PS3 has clawed back 3 million in sales in one of the most competitive markets we have seen in a long while.

I'm not afraid to admit my bias, will you admit yours?

 I agree calling one product line in a whole product line a failure when it's still being produced and will keep being produced as a failure?

that's a little premature. to call the ps3 a failure.!



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

GameAnalyser on 27 November 2009

whatever, the next gen PS console shud come with ps1,2,3 backward compatibility and a much competitive price-tag.



joeorc on 27 November 2009
Tridrakious said:
theprof00 said:

Hello everyone,

This is just going to be a brief intro to the Sony strategy, so that people can understand the approach and use the ideas herein to better predict things like next gen capabilities, direction, and reasoning behind decisions.

 

The Intro:

A lot of members on this site talk about Nintendo's disruption strategy, as highlighted by Malstrom in several really great articles (for the most part he doesn't know much about video game business, but he knows a lot about business in general).

What a lot of people don't realize is that disruption is real, and has been going on for years, back to the NES days. When we look at the wii, as far as disruption goes, we can see a striking similarity. The wii sells similarly to the ps1 and ps2. This is because Sony, like Nintendo, uses disruption. So, "Why", you may ask, "is the ps3 not selling very well". It is because of the 360 and MS, and to a lesser extent, vastly cheaper computers/laptops.

The Sony strategy, of course, is to disrupt the PC market. Granted, the PC market is still thriving and growing, but the ps1 and ps2, were the first systems that allowed PC gamers to realize that console graphics and price difference could really rival PC systems. Back then, computers frequently ran over 1000$ and had a lot of restrictions. You needed specific requirements for each game, and parts pricing was nothing to laugh at, like they are today. Consoles, on the other hand, didn't need upgrades, except from one gen to another, and usually the cost of a system was the price of a new videocard. Quite a value, right?

You will begin to notice that Sony is in the practice of disruption from here onwards as you read about their decisions.

The evidence:

PS1 was one of the first consoles to allow for cd-music playing. This first move targeted stereo systems and gave users a way to start working with media.

PS2 began DVD playback. This targeted home DVD players.

While these seem more like Sony is targeting livingroom disruption, don't be confused. It may seem like these options actually bolstered the computer through cd and dvd burning. But these were only the first steps. Let's continue.

PSX came out shortly after the ps2, with CD and DVD burning capability! While the PSX didn't sell gangbusters, it is considered the basis for the future of Playstation. It introduced the XMB media crossbar, that would later appear on the PSP, PS3, and bravia tvs.

PS3 then released with several unique characteristics. It supported online and web browsing, required special programming, and played BluRay. You may ask, "where is the media-burning hardware, though". Well, while media burning is still important in the world, the general public doesn't use it like they used to. No longer are people burning cds for music, and while people do still burn dvds for movies and pictures, thumb drives and memory cards will replace it soon enough.

Going Forward:

After reading this, I hope you will see Sony in a new light, and I hope it will spark interest in critically analyzing everyone's favorite company .

In the future, Sony will be targeting the PC more and more, just as 360 will be reinforcing the PC.

Looking at the future, we can see some trends.

  • motion/touch control
  • Digital Distribution
  • streaming video
  • P2P
  • Social networking
  • internet use
  • Reusable/portable media
  • Huge harddrives

Expect the ps4/psp2 to use some, if not all of these.

 

If you enjoyed this thread, let me know. If you did not enjoy this thread, please do not post "fail" or any pictures, they will be reported. If you would like to debate or discuss, please do so appropriately.

Interesting article. Nice job.

Not many people know about the PSX. Which to the people who do know of it, see it as what it is. The lab rat of the PS3.

yup, its about "media centric Entertainment PC's" for the living room and Sony is in direct market with not only Microsoft but with Apple, and a few other's as well.



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

joeorc on 27 November 2009
CGI-Quality said:
^^ It was still, in a sense, a business failure when the product isn't raking in the kind of profit needed to call it a day. Are things looking up for Sony, no doubt, the PS3 in itself will go down as a very memorable piece of technology. However, so will the losses it generated and the bind it put Sony in, even though it very well may have just paved a more successful future for the PlayStation 4.

Just a thought.

but that is also based on what your plan is for the product off the start:

Sony states that all PLAYSTATION SYSTEMS ARE ON A 10 YEAR CYCLE PLAN!

how anyone could state that the PS3 is a failure when in some part's of the world the PLAYSTATION 3 is not even a year old yet, it was just released.

Sony released the PS3 at one of the highest cost game system's ever, there is no way any company would expect the system at that price to outsell a lesser cost unit. that less cost unit has a large selling component vs' the much higher cost system. that would be very unreasonable to even think that , not even Sony would have expected that. that's like saying the town car is going to sell more unit's than a much cheaper car its just not going to happen.

we do not know what "business plan" sony has on the playstation brand on a per system basis, but even as it is selling over 25+
 million unit's world wide in some cases the PS3 was just released show's that in the short ammount of time the PS3 has been on the market Sony has sold a good amount  of system's.

and

not only that they have not only their own system's to compete with

you have Microsoft's and nintendo's, there is plenty of system's on the market , an for many consumer's not enough free time to play them all .



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

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theprof00 on 27 November 2009
NJ5 said:
What exactly is your point?


My point is that you're wrong in calling everything that happened with the PS3 a necessary sacrifice that Sony did on purpose.

Really? Because I thought your point was

NJ5 said:
@theprof00: When you call it a sacrifice, you make it look like Sony was planning to lose these billions even after 4 years of launching the PS3.


But when they launched it, did they expect to drop prices so fast that even after all these years, they're still unprofitable both on hardware and overall? No. I don't believe that. I hope you don't either, and that this argument is all based on a mutual misunderstanding.

So, you're saying they didn't expect to drop the price so quickly? I'm pretty sure that, as of the slim, they are now overall profitable (SWprofits-HWcost)

I think they didn't plan for the economy to be in this bad of a shape, specifically the exchange rate's influence which consistently chomps 20-30% worth of profit. In that case, yes, they didn't plan to be in this bad of shape. But then again, not many did.

Overall I think they expected to lose maybe 4-5B on playstation, which would be recouped later.

 



theprof00 on 27 November 2009
GameAnalyser said:
whatever, the next gen PS console shud come with ps1,2,3 backward compatibility and a much competitive price-tag.

I think it will be more price competitive, but as far as BC goes, even PCs lack most OS based BC.

One of the ongoing conflicts that exists with BC is the 10-plan that Sony touts so often. Making a console BC often kills off the older console, but Sony is keen on keeping their old consoles around for a long time afterwards.



joeorc on 27 November 2009
theprof00 said:
NJ5 said:
What exactly is your point?


My point is that you're wrong in calling everything that happened with the PS3 a necessary sacrifice that Sony did on purpose.

Really? Because I thought your point was

NJ5 said:
@theprof00: When you call it a sacrifice, you make it look like Sony was planning to lose these billions even after 4 years of launching the PS3.


But when they launched it, did they expect to drop prices so fast that even after all these years, they're still unprofitable both on hardware and overall? No. I don't believe that. I hope you don't either, and that this argument is all based on a mutual misunderstanding.

So, you're saying they didn't expect to drop the price so quickly? I'm pretty sure that, as of the slim, they are now overall profitable (SWprofits-HWcost)

I think they didn't plan for the economy to be in this bad of a shape, specifically the exchange rate's influence which consistently chomps 20-30% worth of profit. In that case, yes, they didn't plan to be in this bad of shape. But then again, not many did.

Overall I think they expected to lose maybe 4-5B on playstation, which would be recouped later.

 

what we do not know is Sony's

 

business plan!

we can guess , but when you launch a system with a guess cost of component's over $800.00+ per unit , there is no way any company would be expecting a quick turn around , Unless Sony does indeed have a 10 year plan.

10 million system's sold world wide a year/ year= 100 million sold system's

the PS1 DID IT

THE PS 2 DID IT

THE PS3 IS NOT EVEN A YEAR OLD IN THE MARKET IN SOME AREA'S OF THE WORLD,  and still not even 3 year's old in UK so

the fact that already the PS3 has sold over 25+million world wide.

 



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

NJ5 on 27 November 2009

When I said "these billions" I meant all of the money they've lost so far. Geez do I need to spell out everything? Isn't it obvious from several of my posts that I meant all of the losses so far?

I'm pretty sure that, as of the slim, they are now overall profitable (SWprofits-HWcost)


Let's wait and see... if I remember correctly, SCE's only planning to start making consistent profits in the next fiscal year (and that, btw, is also what they said last year).

Look, all I'm saying is those price cuts and their effect were way too radical to be planned. The best example is that Sony cut the EU price by 33% (200 €) before the PS3 even had its first holiday here. Surely you can't tell me with a straight face that that was all according to plan too.



My Mario Kart Wii friend code: 2707-1866-0957

joeorc on 27 November 2009
NJ5 said:
When I said "these billions" I meant all of the money they've lost so far. Geez do I need to spell out everything? Isn't it obvious from several of my posts that I meant all of the losses so far?

I'm pretty sure that, as of the slim, they are now overall profitable (SWprofits-HWcost)


Let's wait and see... if I remember correctly, SCE's only planning to start making consistent profits in the next fiscal year (and that, btw, is also what they said last year).

Look, all I'm saying is those price cuts and their effect were way too radical to be planned. The best example is that Sony cut the EU price by 33% (200 €) before the PS3 even had its first holiday here. Surely you can't tell me with a straight face that that was all according to plan too.

there is no doubt that there has been some problem's along the way. and there's alway's going to be some problem's no matter what, but to expect Sony to not see how High cost component's will not hinder their bottom line is pretty far fetched. that's why they have a :

 

business plan!

Sony keep's saying the Playstation system cycle is 10 year's.

do you not think that maybe, just maybe that is part of their business plan for each and every playstation system?

yes business plan's can change, but when the playstation 3 is not even in it's 4th year, and in some cases 1st year it's kind of far fetched to call it a failure.



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.