Actually, reading the article and the original source it seems the "six cent per dollar" is most likely for overall hardware (meaning both the $299 120GB and $349 250GB are factored in) and that the "$18 loss" is PSU's fuzzy math.   So really, it's likely a greater loss than that at $299, but until we have a SKU allotment breakdown (lol on ever getting that) we can't figure out by how much.

That's $18 on PS3 hardware alone (most likely along the lines of what jarrod said). Does not take into account marketing, inventory, shipping, etc. to my knowledge.

"Sony loses about six cents for every dollar of PS3 hardware sales."

Also, as others said, only 15% reduction in costs by March 2011 means the PS3 will still cost ~$270 to make... The likely hood of a price cut before Fall 2011 is looking pretty slim to none unless they want to take another substantial loss on hardware.

"They're hoping to cut production costs by 15 percent by March 2011."

So if it costs ~$318 to produce now (not factoring in marketing, shipping, packaging, stock, etc), I don't think they will be profitable on hardware for another 6 months or so.

Did they say in the US?

I thought it was just an in general 6 cents lost for every dollar.


Meaning that the overall average that they lost this quarter was 6 cents for every dollar.

How do you know it doesn't factor that? A lot of those costs are usually included.

Based on how they worded it.  They didn't say "6 cents per every dollar of PS3 revenue/PS3 sales."  They said they are losing 6 cents for every dollar of PS3 hardware sold.  That to me means they are not factoring in costs outside of the hardware alone.  I don't know this for sure, obviously, but it's a pretty common business deception tactic so it wouldn't surprise me.

So you assume they're using a deceptive tactic?

Of course I've only studied cost accounting here in my country, but here you're supposed to include stuff like stocking, packaging and even things like the electricity bill from the warehouse in the cost of manufacturing. The law actually requires it.

Of course I could be wrong and it could all be a spin. But you jump right to the assumption that it was and I think that shows your bias.

Which implies that as the PSP and PS2 are profitable, and likely VAIO computers (thanks to Microsoft, oh how ironic) that the overall PS3 enterprise taken by itself is still unprofitable considering their first party focus on this platform, software royalties, advertising, online costs, management, research and development, shipping, etc. It implies that the PS3 itself will be unprofitable for 4 financial years at the very least, financial year ending 2010. I think to their credit its one financial year less than the Xbox 1.

I'd say "six cents on the dollar" is probably for total assembly, boxing and retailer markup. It might include transport/warehousing, but that's iffy and who knows how Sony's internal inventory system works. It plainly wouldn't include marketing or whatever though, that's not a "hardware" cost.

Anyone have a WSJ subscription, I'd like to read the original source and not just PSU's slanted take...

Yeah, though in fairness Xbox 1 only had 4 FY cycles before 360 hit, and Microsoft pretty much abandoned it asap.