The $800+ manufacturers price was true at launch. Costs come down over the lifespan of a console. The 360 was losing over $100 when it launched, but was close to making a profit a year later (the Core made profit, the Premium almost). We already know that Sony made hardware modifications to lower cost for the EU launch. I see no reason to believe that the cost of the PS3 isn't now closer to $700.
If that is the case Sony can still cut $100 and not lose any more than they were at launch. This is likely the minimum level of a price cut, to bring the PS3 in line with their cheapest BR player. The success of BR forced radical price cuts for HDDVD, which forced them in the BR players; this was likely not part of Sony's plan, and so, ironically, the success of BR may be indirectly hurting the PS3 by forcing them to cut prices before they intended (there was a quote from a Sony rep early in the year saying that they weren't cutting prices this year).
Even if a price cut causes them to lose $200 or more per console (again), I have to think it is a far more viable option than letting the PS3 and the "Home Entertainment Center" strategy go down the pipes. There's little question that Sony is underperforming now, and most agree that the competition will cut prices this fall. For Sony to hold off would essentially let Microsoft and Nintendo bury them this holiday season, and pretty well knock them out of any legitimate contention this generation.
Existing User Log In
New User Registration
Register for a free account to gain full access to the VGChartz Network and join our thriving community.
