Console Profitability Since November 2006 - Who's Making What?

[TheBigFatJ]

FreeTalkLive said:

TheBigFatJ said:
If Sony isn't losing any money on each PS3 sold, then how did it lose so much money last year when the PS2 and PSP were almost certainly generating significant profits.

I guess if you factor in the money the stores make for selling the console, shipping costs, and the huge marketing budget, Sony would still be losing a lot of money. Sony may even be losing money on games because it costs more to develop games like GT 5 than Sony is making by selling games like Lair and Heavenly Sword.

 

Sony makes money on PS3 games sold by third parties because they charge a fairly heafty royalty.  The thing here is that the PS2 sells a lot of units and each unit has a very wide margin.  The PS2 also sells a lot of software, and that's pure profit for Sony, as are third party PS3 games.  The PSP is even doing well and selling some software, generating even more profit.

For them to lose as much money as they did last year, the PS3 must have a very significant per-unit loss associated with it. There's no way it's zero.