Anybody think 8 gb of GDDR5 is a mistake for PS4

[ironmanDX]

Chark said:

ironmanDX said:

GamersAreTrash said:

Well, assuming Sony sells approximately 10 mill PS4 in the first year, that would be more than a $1 billion loss from just the hardware. The loss will probably be offset by software & accesory sales.  

Not likely. It is the beginning of the gen, a 10 million install base isn't enough for them or anyone else. The offset from software and accessories wouldn't be enough. It could take years like the ps3 did.

The PS3 sold for a $240-$300 loss on every console at first and that doesn't even include the expensive R&D Sony did. Not only will the PS4 cost Sony a lot less behind the scenes in R&D but a $100 loss is nothing and can be easily off set by software and accessories. Those who buy consoles at launch tend to be the consumers who purchase the most software as they tend to be core consumers and will have the system the longest. Depending on what they buy I'd guess anywhere above 5 items/games will already be profit for Sony for that customer.

Look at the Vita, it seems most of the members here are in or around the double digits in software just after its first year in the market. You can look at the software ratio on VGC which is 2.5 but software is hard to track and according to Ubisoft Vita digital sales are above 15% on their titles.

Selling at a loss initially can really help Sony create a stronger demand for their hardware and increase their install base which will transfer to profits for them down the line. Eventually they will be able to cut costs and sell break even or better and can utilize price cuts when needed. Any damage from selling at a loss of only $100 will easily be offset, whereas it took the PS3 at least 2 years even to reach the break even point.

That's a good point. Now we just have to wait for the price to be announced at E3 or whenever they decide to do it.

As I said before though, the initial install base will not be enough to offset the losses. Say it costs $500 at launch (parts alone cost this not including r&d, shipping, adverts etc, so I thought it a good figure as an estimate.) To offset the loss per customer they'd have to spend another $100-150 and that's if it doesn't come bundled with a game already which would put the price up again slightly higher.

It now costs around the same as the ps3 at launch for everyone if they buy enough to make Sony break even at launch. (please read that carefully people, I'm not saying the ps4 will launch at $599.)