PS3 a faster money sink than the Xbox? I can see why no price cuts soon.

[NJ5]

drkohler said:

NJ5 said:

@drkohler: You still haven't explained why your numbers look like BS considering Sony's declarations and financial results.

You came up with a $350 manufacturing cost, which would make the PS3 profitable even at a $400 price, going against Sony's CFO's declarations. You have also failed to account for such simple things as taxes in Europe's case, and repeatedly ignored all the hard evidence which was presented.

Oh my god, there comes another one... do you know the difference between manufacturing costs and production costs? Do you know how large companies project the manufacturing and distribution of mass goods (hint: I do). Do you even realize that with manufacturing costs now around $350 (-10%/+5%), a selling price of $399 _in a shop_ is obviously not generating profit (for the producer). However, selling it around $600 in Europe obviously does make a profit (no matter how high the tax is). For the 100 millionth time, Sony in last fiscal year was still selling machines from the remainder of its first generation (approx $840 manufacturing costs) and a sizable amount of its second generation (approx $620 manufacturing costs). It does _not_ take a rocket scientist to see that when shops sold those machines at $499, somebody was taking a heavy hit for every unit sold.

 

Well since you're so smart, why don't you explain instead of just saying "oh god you guys are so stupid and don't understand...". At least some of us are putting some evidence behind your claims, and basing them on the best available sources.

Here are four things you could explain:

1- Explain what you mean with the difference between "manufacturing" and "production" costs. Explain why one of them matters and the other one doesn't.

2- Explain why we should believe a number written on a internet forum by some random poster who claims to know $350 is the manufacturing cost. Do you have the bill of materials for a PS3, the list of suppliers, the contracts Sony has with those suppliers? How do you come up with that approximation, when analysts have come up with others? Why are you more qualified than everyone else? Extraordinary claims require extraordinary proof, and from what I've seen you haven't provided even the slightest bit of evidence.

3- Explain why you keep quoting European prices with included taxes, when it would be much more significant to quote prices before taxes (often more than 20%) which are the maximum Sony can receive. Explain why you, being so qualified, can't correct this easy mistake even after being told about it twice?

4- Explain why, if you are right, Sony has stated multiple times that they're losing money on hardware (oh right, is it because you claim to know that all the machines recently sold were produced long ago, a claim which you haven't proved?). In that case, explain why they think they're only going to start breaking even at the end of the fiscal year, or early next fiscal year?