PS3 price cut at TGS?

[Lost tears of Kain]

Magera said:

Lost tears of Kain said:

Borkachev said:
Do you really all agree with Dodece that Sony is going to go back to the $600 price point in NA? I have a lot of faith that they can pull the PS3 out of the gutter, but I think that's just about the only move they could make that would doom it beyond any hope.

Sony has screwed up a lot, but they're not that stupid.

Yes, of course in their best interest in pulling out the ps3 is to drop the price, but, sony also doesnt want to dig in its pockets to deep, like is stated above its almost pulling even on sales, would they want to lose 100 on every ps3 sold?

It comes down to how deep does sony want to go

It's a catch 22 really...  Sony needs to begin to break even with their consoles and they are/have almost reached that point however, if they keep the cost at it's current price, they risk selling so poorly that recouping their losses will take a very long time.

Their other option is to reduce the price further to increase sales thus loosing even more money which in turn will mean it will take a very longer to recoup their losses. (This is soley based on hardware sales loss vs software sales profit - although the more cosoles sold mean the more software sold).

However, one thing we all need to keep in mind is although it may now only cost $605 to produce a PS3, how long will it take until it actually sells these consoles?  I mean, don't forget that Sony produced 5.5 million units up until march this year, (which have still not sold) -  how much did each of those units cost to produce? It's those units that Sony is taking a huge loss on with this price reduction.  And also, Sony did not stop production of PS3's since then thus they would have been producing at least 600K - 800K units per month since then (an estimated 3 - 4 Million units so in total would be 8.5 - 9.5 million)  and all those units would have cost more then the current $605 units, although the cost wouldn't have been as much as the ones produced before March.

 One last thing to point out... Did anyone else find it strange for Sony, after so long of reporting Shipped to warehouse, suddenly changed to 'shipping to retailers'? - Of course it is a logical move but I think there was more to it.  I think they had realised they had more units is storage then they did at retailers and it would make them look incompitent to announce they had shipped 8+ million Units when only 3.5 million had sold. 

And on that note, does anyone actually know the current amount of Units produced by Sony?  I'm guessing anywhere in the range of 8.5 million - 10.5 million produced.  That would be a huge amount of $$ to be tied up in systems and I think that is mainly where this raised finances is going. 

Yes i agree, and i was thinking of that as well