CNET: Why Sony needs to (but can't) drop the price of the PS3

[TheBigFatJ]

gavind5uk said:

TheBigFatJ said:

gavind5uk said:
revenue doesnt imply profits, revenue implys revenue, i.e. excluding expenses, and all companies tout their revenue numbers because its always the largest number on their books lol

 

Agreed -- my wording was poor. High revenues /suggest/ profits for many people. However, as Microsoft has shown before, if you have a business plan that executed poorly you can have the highest revenues and negative profits.

Right now Nintendo has the most revenues and the most profits, so you don't hear Sony or Microsoft talking about revenues. Sony used to talk about revenues or sales numbers for the Playstation family but didn't compare them to the Nintendo family.

 

Do you think with N64 & Game Cube being lambs to the slaughter attributed to Sony getting caught off guard somewhat? I.e. Not thinking the Wii would compete possibly?

 

I think both Microsoft and Sony ruled Nintendo out.  This worked against Nintendo as well because third parties didn't give the Wii the lineup they would have if they would have properly estimated its success.

The Wii was a wild card this generation.  Microsoft and Sony follow similar business models and considered each other the big competition before the generation started.  As this article points out, Sony's problem is price (and cost). Unfortunately, this is Ken Kutagari destroying Sony's games division single handedly: he kept progress and prices secret from other Sony management, he had disregard for their requirements, and he felt that Sony should be able to make the PS3 a reasonable price no matter how much the initial costs were.  He also felt like he built an infallible brand with the Playstation.

At this point, it's not the Cell's fault that the PS3 is so expensive. It's not Blu-Ray's fault either.  It's just an overengineered console with too many pricey components.