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nightsurge on 20 August 2010
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superchunk said:
nightsurge said:
 

No, Sony could NOT match a 360 price cut and remain profitable.  They only profit by very slim margins (no pun intended) on the hardware.  Not even 10%.  The 360 on the other hand has racked up a laundry list of cost savings over the last 2 years (die shrinks, cpu/gpu merge, mobo shrink, cooling shrink, psu shrink, casing shrink, etc) and has yet to cut the price.  They could take quite possibly take a $100 cut on hardware if they really wished and break even or take only a very mild loss.  If they did a more realistic $50 cut, the PS3 would again be losing anywhere between $30-40 on hardware again.

Also, the 360, even if it had no staggered launch of the slim, would be nowhere NEAR PS3 or below numbers.  It was settling at 40k above PS3 weekly numbers in Americas and another 25-30k above PS3 numbers in Others.  After the Arcade S effect wears off it will still settle far above the PS3 numbers.  With Reach coming in a few weeks, and then the holiday sales picking up, the 360 is going to be staying above PS3 numbers for the rest of the year save for a week or 2 following GT5 launch.

Btw, the new 360S is still struggling to meet demand.  They are cleared out of shelves within a day or two of restocking.  That's pretty clear that the deman and production for these units has not quite been met yet.

The Arcade 360S has yet to show up in Others numbers.  With over 115k in Americas this week, Others is likely to be about the same for next week and the Americas numbers will likely be around 105k range still.  So for the last 2 weeks of the month the 360 will sell easily another 400k units pushing this month's total to ~900k units again.  There is no way that is going to drop by 400k units in just one month's time with Halo: Reach and the beginning of the holidays/Kinect hype effect taking place.

I'm sorry but I just don't see how you can be low balling it so much given all the evidence in front of you.

I think you really underestimate the core competency of Sony in miniturization and its ability to cut costs very quickly. Keep in mind that in 2006 the PS3 costs Sony over $800 to create, now it costs less than $300. Sony became profitable with the PS3 before it latest die shrinkage in February, 6 months later and I'm sure there is a decent margin.

I'm not udnerestimating, I think you are overestimating.  It took them 4 years to drop that amount.  The first year or 2 is where the most drastic drops occur and they get less and less significant as the price decreases.  By now the PS3 is approaching the point where it literally cannot cut much more cost from production because the dies cannot shrink much smaller and the other parts such as cooling, power, casing, have already been shrunk down as small as they will be able to get.

360 has NO game launching that hasn't had a predecessor that is exactly like it. Reach will sell very well, but, it isn't going to grow demand more than the natural holiday season will. GT5 on the other hand is a much larger name with no predecessor really as I don't think prelude really counts as its merely a large demo. A good portion of GT fans woudl have skipped it or not purchased a $300-$400 PS3 for it alone.

At this late in the generation, not many people would be holding out for one game.  Surely most if not all GT fans bought their PS2 and played other games on it as well.  Had GT5 launched a year or 2 ago it would have had a much larger affect imo.

How has 360S not shown up on Others numbers when it released there weeks ago? I said ARCADE 360S Also, I was just at three large retailers this last weekend and every console was in plentiful stock. So you'r hypothesis of 360S selling out can't be all that true across the board. I did not see any more older models of 360 though.

Guess we'll start to see whose right in a month.

And yes, I'm sure we will see who's right.