albionus said:
Other threads have dealt with this issue so I'll be brief, Sony does not have heaps of cash to throw at the PS3. The company's total profit is only $1 billion, they have about $4 billion cash on hand, and have over $11 billion in debt (up from $9 billion a year ago). They've put themselves in a no win situation because it is becoming clearer with each passing week that the PS3 is not selling at the rate it needs to for Sony to have any hope of recouping its investment. Their latest loss estimate for 2007 is now $2-2.2 billion (250billion yen) which is up from 100 billion yen last year. Given this trend and the fact that PS3 sales are still not what they expected it'll probably end up worse. Everyone says Sony needs to cut the price, they lose $100-200 a system, are they supposed to cut $100, $200? They finally were able to sell the PSP at cost but they've been forced to eat $30 a unit there to spur sales. At some point (sooner than I think most of you realize) Sony will run out of either shareholder patience or money. The fact is that Nintendo has far more money to throw around than Sony ($1.5 billion profit, $10 billion cash, no debt) and doesn't have battery recalls and TV R&D to worry about. Even if Sony did have enough money it's stupid of them to have put themselves in this position, they are the market leader they shouldn't be blowing money like this. I agree it's still too early to write off Sony, and usually the first year is too early to write off any video game company. Then again usually video game companies don't lose up to $3 billion their first year and go from 20 million units a year to maybe 6-7 million. All we can say about the sales is that 3 weeks in and the PS3's Euro sales are conforming to the trend elsewhere, sells out to the few rabbid Sony fanboys with too much money in their pockets and then drops. Forget the AAA titles, 3rd party support (which will only decline faster with the latest sales figures), and all the other usual video game indicators, it's money that matters most because without it nothing else matters. Sony is getting dangerously close to discovering that. |
I know I didn't list any reason. I usually do, I'm just tired of listing them, sorry. I agree wholeheartedly with the highlighted portion of your statement. I don't think the console's success rides on Sony's profit margin at this point except for potential price drops. I hope that Sony has enough business sense to drop their prices as rumored.
I just think all the parts are there. Most non-microsoft studio games seem to go to the PS3, and Sony has better in-house exclusives. DMC4 and GTA4 wouldn't worry me if games like Bioshock also went to the PS3. Why Take-2 chose 1 and not the other is beyond me. Capcom also hasn't announced Dead Rising for the PS3 which also worried me a little. Still, though, I think the games will be there. Sure, I wish they would hurry even though I personally have plenty to play with Elder Scrolls because that game is ridiculously long (and Motorstorm when I need a break), but I understand for the success of Sony's console they need fewer delays and to get games out. I think Home has great potential, little big planet as well. The Home beta needs to come out soon because I'm tired of checking that page.
I think the PS3 is a great example of what a launch console should be. Everything you need is included (even free games/demos on the PSN, better than demo disks, worse than Wii Sports).
Very important third party exclusives are still there, and I hate continually naming them, but MGS4 and FF13. Now, if those go multi-platform maybe it will spell the end. There are others that are multi-platform but not on the Wii, which I think is key to differenting the 2 HD consoles from the Wii. I believe if not all , then at least are going to succeed by default, so I'm not so worried about the Wii's success. I'll be getting one as I think a lot of PS3/360 owners will do or have done.
Microsoft not performing at all in Japan is a key. If all the Japanese developers go to the Wii it won't matter, but I think some will still favor the PS3 over Microsoft. Europe is Sony's strongest market considering they developed it, and I think there is potential there to catch microsoft as soon as early next year.
But, as I've said, the price is still the issue. Although I think, and most people at least agree on this, the PS3 is the better value as a piece of electronics but most people aren't willing to spend more money to play what they think are mostly the same games. I think Sony will differentiate themselves later this year with games and Home, but a price drop that is not countered would catch them up very quickly I think. Now, obviously, if M$ follows with a price dro, it'll be interesting.
I just think people are overreacting to sales dropping after a launch. This is not the first time I've said the reports of the demise are greatly exaggerated, and it probably won't be the last.
