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theprof00 on 03 February 2012
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Alby_da_Wolf said:
theprof00 said:
Alby_da_Wolf said:

Not games, if he meant HW, but memory cards actually are HW, so he could have meant profit including them. Anyhow, PS3 taht was initially a blood bath, stopped losing money on HW in May-June 2010, that is little more than three years and a half after launch, if initial costs aren't as horrible as PS3 ones it shouldn't be impossible.

Maybe Sony is just learning another lesson, this time from MS and how its marketing did wonders. The first lesson, learned from its own errors, was that too much arrogance is bad, this second one is that too low profile is bad too, once the worst problems are solved and there is good SW, a company should advertise and, yes, brag, a little more, it's a noisy world, and you don't need just a good product, you must be a little bit loud to make people know it, without exaggerating to avoid annoying them.

And how does he decide the cost and profit of something which has a sliding level of revenue? ie; 4GB vs 32GB. He's not profitable on any size? Just on one size? An average size?

Yep, ps3 stopped losing money 3 and a half years in. That would be remarkably similar to what he is saying here, which would reinforce that it includes price drops. So, they plan on being profitable after at least one price drop.

I'd have rather heard from kowen, but he only responds to irrational responses. I dunno.

I'm quite sure those premium priced memory schticks are profitable on any size, they're not very different from standard memory cards, and the latter are profitable even at dirt cheap prices.

My point is that the profit on vita hardware cannot feasibly include the memory cards because there is no distinct point of reference. If you say, "aim to be profitable in 3 years" and yet don't actually know how much you're making, well, then that's a pretty dumb remark not just because it's uninformed, but because it looks bad to investors to say three years (a long time) when factoring in memory cards would make it a lot lower. Being that as the case, I believe he's speaking specifically about profit margin from the vita itself, not mem cards, not games. It was probably directly in response to "are you losing money on each vita sold", or "is the vita itself sold for profit" ala razorblade strategy vs Nintendo strategy.

Given the components cost we saw from isupply (or whoever it was) being 150, manufacturing costs and shipping and exchange rate most likely make it unprofitable, adding over 100$ to the equation. Manufacturing and shipping probably adds 40-50$ per vita, so at 200 with a sour exchange rate, its probably costing them 300, with the majority problem being exchange rate, since cost of manufacturing goes down exponentially over the course of production at scale. Given that it take usually 1 year to decrease manufacturing by 50%, it will probably be 1.5 to 2 years in before it is profitable, wherein there might be a price drop, or at least an added feature. So, I could expect a price drop, or phone version either sometime spring, fall, winter, 2013.  At which point a new model might take another year to hit profit, so xmas 2014 profit on vita? Sounds right given a price drop or new model, or combination 200$ "touch", 249$ phone.

That's what I'm guessing.