PS3 price cut hot potato passed again.

[DarkNight_DS]

sanderz1 said:
All of those PS3s sitting in warehouses are NOT money already spent. Those things have to be inventoried and taken into account whenever Sony releases a fiscal report. It's the same thing with every business.

At the beginning of a period, you have to count your beginning inventory and it is listed as an asset. Since they are listed as an asset, it's NOT money already spent. All those consoles were inventoried at either their $800+ cost or their $600 sell through worth.

Either way, if Sony drops the price, then they have to take a loss on that amount on each console and it will make their beginning inventory inflated, which means that it won't actually be as high as they think.

If they have 2 Million consoles sitting in warehouses, and they drop the price by $100, then that's a $200,000,000 hit that their profits are gonna take all at once that they cannot possibly recoup.

 Most likely they were inventoried at 800$ which would mean that they are sitting at either 400,000,000$ in the hole or possibly 600,000,000$ if they drop the price by 100$.  Also, warehouse's and shut down production lines still cost money.  If sony isn't stockpiling more PS3's.  Then they are losing even more money on the shut down lines as they'd still be obligated to pay out a percentage of their contract with the manufacturer.  Someone recently said (from Sony) that if they dropped the PS3 price by 88$, they'd lose 900,000,000$.