Avinash_Tyagi said: Played_Out said: Given that the PS2 sold more in the last year than either the 360 or the PS3, I would say it is far from being a poor business plan. By covering both high and low-end markets, Sony actually managed to sell more home consoles last year than super-mega-hit-makers Nintendo, yet there are people who still prophesise doom for Sony and fail to understand the logic of their strategy. BOTTOM LINE: They are better at business than you are. And yet Nintendo managed to post big profits while they posted losses, they aren't so good at buisness it sounds

The words you responded to, Avinash_Tyagi, are CERTAINLY not the words of a businessman.

There's a flash/java game called Lemonade Stand that teaches it.

How much did it take you to make your drink, how much did you sell it for, and how much did you get in the end?

Sony's NOT better in business than Nintendo or they wouldn't have blown through over half of their 13 years of Playstation success in 1 year. And furthermore that record-setting 13 years of Playstation success should have yielded corresponding record-setting profits.

Sony's a vastly larger and more diversified corporation than Nintendo is. Nintendo you might as well say is a rinky-dink mom-and-pop type of corporation in comparison. But BECAUSE they are JUST THAT DAMN GOOD-AH (Triple H) in business they can go toe to toe with giants like Sony and Microsoft...and WIN.

You can sell all daggone day. But if your expenses exceed or match your returns then you have done absolutely nothing.

The core rule in business is to PROFIT.

I can sell just one item, not one set of item, simply one item like say a rare coin. And if I sell it for higher than what I paid for it then I've done good business. Whether I sell millions or just one of anything if my outgo is less than my income then I have done good business.

I have done BETTER business if my income to outgo ratio is better than another's income to outgo ratio.

If I got 5 in for every 2 out and someone else get 3 in for every 2 out, then I've done better business than the other guy.

I may only put 2 out getting 5 in while another puts 10 out getting 8 in but while one puts out more than me how much am I getting back in return compared to the other?

5/2 = 2.5

3/2 = 1.5

8/10 = .8

Who's doing better business?

John Lucas 

Ahh, finally. The Wisdom of John Lucas on P&L. Unfortunately Sony Fanboys refuse to see it in the common sense Business 101 way.

BTW John, I think when Japan sales come in this week the......ahem, "fad" console (LOL) will have sold (not shipped) 20 million PROFITABLE units :)

Sony better get the PS2 stock ready! Cause you know they know what they are doing.......

@ johnlucas

Yes, but there are long term and short term aspects. I am sure R&D, promotions, production costs for Blu-Ray and PS3s are still far away from being fully earned back, however Sony's long term perspective may be a lot better.

Sometimes you will have to make significant investments early on in the game to generate huge profits later on. If they wouldn't have done these investments their current bank balance could have been much better, but 10 years down the road be significantly worse compared to what could have been.

Also do note Sony is an important HDTV producer, this devision has done excellent business last christmas, so from a wider perspective HDTVs are great but without much HD content there's far less reason to buy them.

Focusing your effort on a system which users are moving away from (and new users are not buying into in real force anymore) to try to compete with a system which is attracting users at record levels is not a good move ...

Can't Sony come up with something new instead of copying Nintendo

HappySqurriel said: Focusing your effort on a system which users are moving away from (and new users are not buying into in real force anymore) to try to compete with a system which is attracting users at record levels is not a good move ...

We are talking about a console which by far sold the most units globally in 2006, even during christmas 2006.

We are talking about a console which still beats global 360 hardware sales the past few weeks according the website.

It's a console that's already profitable, cheap to sell and will drop in price even more this year. Games shops around the world are stuffed with a huge varierty of easily affordable PS2 games.

I say keeping the PS2 alive for as long as it makes sense benefits not only Sony, but also consumers.

From a business standpoint, if you wanted to keep pumping out games for the PS2, why in the DEVIL did you 1. remove backwards compatibilty and 2. want folks to focus on buying the PS3? That's really wounding your market. Think about it - you want PS2 gamers to buy your PS3, with your best-selling model having the ability to play PS1 games but not your most popular system. So, you realize you need some serious cash, so you decide to revive your cash cow of a system. The problem with that is ... how are you gonna shaft your current customers - the ones who endured ridicule for buying a console on brand-name alone? Why would Sony consider it? They are losing money - and they know they can get a quick buck off PS2 owners. I know a few folks who traded in their PS2 to get a PS3. If it doesn't have BC, forget it.

Sony proves how much they love their customers by pulling stunts like this. And what's even funnier - folks will STILL support PS brand. Count me out of this foolishness.

Sony = Tools

Lastly, what's sad is - how SOny will willing focus efforts on making new games for a dying system when you have tons of buyers - close to 9 million - that are begging you for games. Give me RROD, $50 Live, $100 wifi adapters over this crap ...

MikeB said: HappySqurriel said: Focusing your effort on a system which users are moving away from (and new users are not buying into in real force anymore) to try to compete with a system which is attracting users at record levels is not a good move ... We are talking about a console which by far sold the most units globally in 2006, even during christmas 2006. We are talking about a console which still beats global 360 hardware sales the past few weeks according the website. It's a console that's already profitable, cheap to sell and will drop in price even more this year. Games shops around the world are stuffed with a huge varierty of easily affordable PS2 games. I say keeping the PS2 alive for as long as it makes sense benefits not only Sony, but also consumers.

VGChartz Hardware data for the period 08th Jan 2006 to 31st Dec 2006:

Console	PS2
Total	11,741,063

VGChartz Hardware data for the period 07th Jan 2007 to 30th Dec 2007:

Console	PS2
Total	8,868,374

 

In 2007 the PS2 sold 75% of what it sold in 2006, it is likely going to sell between 50% and 75% of its 2007 total in 2008 ... At the same time, so far 45 Million people have already moved from the previous generation to the current generation with (likely) 40 Million upgrading this year; the vast majority of these gamers will have owned a PS2 and are not (likely) going to be impacted by a half-assed effort to lure "casual" gamers towards the PS2.

 

This sends a very confusing message to PS2 casual owners: "Don't buy a PS3 or a Wii. Tide yourself over with these games until the Wii gets oversupplied or the PS3 hits $200, whichever comes first!"

Shouldn't the message be "Don't buy a Wii, buy a PS3 NOW!" Splitting your market against 2 major products doesn't sound that great to me, but meh.

@ HappySqurriel

Even if so selling multiple million consoles this year equals quite a bit of profit. If interest drops significantly this year they can always still discontinue the product. As long as there is significant demand why would they?



No, there are people who own multiple new consoles (PS3/Wii, PS3/360, Wii/360, Wii/PS3/360), I think maybe even up to 20% of current users/families own 2 or more of the new consoles (some may even own more than one of the same console). However according to research the PS2 is currently still *by far* the most played on console, I also imagine PS2s aren't thrown away with the trash when buying a new system, more likely the unit is either still in use, sold second hand or given away to friends or family members to enjoy.