Did Sony Profit from the Walmart $100 Discount?

[Mifely]

(1) Selling a PS3 in-store sells more titles than MGS4, typically in the same sale. $$ profit.

(2) $100 gift-card is NOT -$100 profit... its more like -$50, since they aren't selling you items at-cost, just because you pay with a gift card.

(3) Giving away gift cards is a tax benefit. take that -$50 profit from above (in #2) and reduce it some more.

(4) Walmart is a rural retailer. Sure, you find them in big cities, but they don't dominate there like Target does. They have something of a "rural monopoly". In other words, they sell you a PS3... then who are you going to come back to for more games? ++profit again.

(5) Clearing shelf space for the more popular 80GB model bundle -- more PS3s sold in a shorter amount of time.. +profit.


...the list goes on. I don't see how anyone could think Wal-mart was losing money in this transaction, in the grand scheme.

Target offered a similar deal, btw, but theirs was not on blu-ray players -- it was on 40GB PS3s, and it was only a $50 gift card. The 40GB units flew off the shelves like jets... probably with a game or two with each console, and future profits expected. Target wins, just like Wal-mart.