A couple of interviews with Sony execs have come to light implying Sony will either be selling Vita at a break even price point, or at a small loss. If it's sold at a loss, the loss will be relatively far less than that of the ps3 at launch. They also say that the Vita enterprise as a whole should be profitable from the outset.
First is a quote from Shuhei Yoshida, the head of SCEWWS:
| IGN: Most everyone was surprised by the $249.99 price announcement, including a lot of third-party publishers. How important was it for Sony to get to that point and will the company make a profit on the console sold out of the gate? Yoshida: At the very start of this project a bunch of us core members went to Japan and spent a day discussing what it is that we wanted to achieve with the new PlayStation portable device. One of the goals was to hit the right price point, which was actually $250. So at the very beginning we agreed that we're going to hit $250. But during that time we were still recovering from the difficultly we had with the high cost of goods with PlayStation 3 where the company lost a lot of money. We asked consumers to spend a lot of money to purchase what, at that time, was bleeding-edge technology. That was great from a technical standpoint but the technology has to mature enough so that a reasonable price can be put on the performance. For Vita, the price on performance was something we definitely wanted to hit, although we all agreed because we are PlayStation, people expect better graphics and prettier pictures, so we have all those things we wanted to achieve in terms of capabilities, but we capped our ambitions with a cost of goods target that we can profitably sell the hardware for $250. To answer your question, we set out a goal: Yes, we're going to hit the $250 price, and no, we don't want to sell the hardware with a deficit. That's a goal we set out to do and I'm very happy we are achieving that. IGN: So you're going to be profitable with each Vita sold? Yoshida: We haven't completed the hardware development. It's like 98-percent done in terms of hardware, and on the system software side and network code, we have a few more months to work on that. We don't have the final-final answer to that question, but the way we are projecting it seems like we're going to do pretty well. |
Second are some quotes from SCEE's Andrew House from Eurogamer and GamesIndustry.biz:
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Eurogamer: Kaz Hirai was quoted as saying it'll be sold as a loss with a view to making a profit in three years. Is that just the way it has to be these days in order to build an installed base? Andrew House: We have operated by and large very successfully around a model that works on what we call a blended margin. We have very low margins or possibly negative margins on the hardware, offset by a much more attractive margin structure on software and peripherals. We'll manage the business very much in that same way for Vita. |
| Q: The PS Vita price was a nice surprise at E3. But at that price is the system going to be sold at a loss form day one? Andrew House: I think as a business it will definitely be profitable from day one. In terms of hardware specifically, it's really not something we tend to comment on, but I would say it will be a significantly better situation than for example, the PlayStation 3. This is in a much, much healthier place from a profitability stand point. |
