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Forums - Sales Discussion - Sony loses $18 per console in US, possible profit in UK

Slimebeast on 06 February 2010
Alby_da_Wolf said:

We know, or at least we are told, that MS profits on XB360 HW. But is it overall or on each SKU? Does it profit only on Elites or on Arcades too?

Edit @Slimebeast: Obviously digging at Sony (or MS or Nintendo) with sense of humour is always welcome, we all know that hateboys aren't really able to use it

Dude, what's that supposed to mean? I was serious.



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Alby_da_Wolf on 06 February 2010
Slimebeast said:
Alby_da_Wolf said:

We know, or at least we are told, that MS profits on XB360 HW. But is it overall or on each SKU? Does it profit only on Elites or on Arcades too?

Edit @Slimebeast: Obviously digging at Sony (or MS or Nintendo) with sense of humour is always welcome, we all know that hateboys aren't really able to use it

Dude, what's that supposed to mean? I was serious.

Irony can be used in serious speeches and you did it, nothing wrong about it and much better than hateful rants.



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letsdance on 06 February 2010
Attoyou said:
Told ya so (you know who you are)


im still waiting for my apology. those people are just trying to wipe the egg off their face by spinning their words



letsdance on 06 February 2010
Scruff7 said:
I hope this puts the bed the argument over how much Sony is losing per console and ends all these crazy fan-boy rants about sony still losing $$$ on each sale.


funny thing is i said they were losing about 30 when everyone was saying 100.



gamefreak4ever on 06 February 2010
Siko1989 said:
so does this mean Sony is doomed?

Not necessarily since they are doing really well with the software.  See that's the thing.  These stats have to be discussed for stock reason, but its all good.



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letsdance on 06 February 2010
heruamon said:
And what about the staff to support the PSN and the console? There's more to the equation than just console sales and software sales...


lol... seriously? grasping at straws now arent we. they get millions in advertising from home. They sell lots of games on the ps store. I assume thats self sustaining.



Slimebeast on 06 February 2010
Alby_da_Wolf said:
Slimebeast said:
Alby_da_Wolf said:

We know, or at least we are told, that MS profits on XB360 HW. But is it overall or on each SKU? Does it profit only on Elites or on Arcades too?

Edit @Slimebeast: Obviously digging at Sony (or MS or Nintendo) with sense of humour is always welcome, we all know that hateboys aren't really able to use it

Dude, what's that supposed to mean? I was serious.

Irony can be used in serious speeches and you did it, nothing wrong about it and much better than hateful rants.

Sony managed to drop a $600 console down to $300 in less than three years, and still lose only $18.

Meanwhile MS has dropped his console only from $400 to $300 in four years. Yes, with a little profit per console sold, but that's negilible in the big picture because an X360 with HDD should cost only $200 by now.

No irony is hidden lol. It's the dry serious truth.



ChichiriMuyo on 06 February 2010

Funny how absolutely no math is done on that 17.5% VAT to find out even remotely how much of the cost it makes up. It's almost as if people are talking out of their asses because they've made stupid claims about things they don't understand very well. The math on how much it takes to make the things is questionable enough, but to make claims that the device is profitable one place and not the other without even trying to do some math is sloppy and should be ignored. 

And hey, let's compare what the average worker (not exec) makes in the UK compared to the US.  That's something that can affect the cost, too.  Oh wait, you're talling me that labor basically isn't calculated into the cost yet?  Nor is shipping?  I'll be damned.



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letsdance on 06 February 2010
Johann said:
nightsurge said:
Johann said:
nightsurge said:
ethomaz said:
Sony has already said that from March they won't have more losses on PS3 sells for $ 299.

After that the company will begin to seek the profit per console, at least until the next price cut.

"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.

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.

Its the same in the US. I've ran my own business here and we factored all that in for the cost too.



ChichiriMuyo on 06 February 2010
letsdance said:
Johann said:
nightsurge said:
Johann said:
nightsurge said:
ethomaz said:
Sony has already said that from March they won't have more losses on PS3 sells for $ 299.

After that the company will begin to seek the profit per console, at least until the next price cut.

"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.

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.

Its the same in the US. I've ran my own business here and we factored all that in for the cost too.

The thing Johann really seems to be missing here is that iSupply and WSJ released estimates.  Sony themselves haven't released exact numbers on it and never will because they aren't legally required to get that detailed about their oppoerations.



You do not have the right to never be offended.