By using this site, you agree to our Privacy Policy and our Terms of Use. Close

Forums - Sony Discussion - Sony breaking even on PS3/making profit 40gb PS3

misterd on 13 January 2008
Jandre02 said:
weezy said:
End of story Rabidbunny, the PS3 was supposedly a $900 device and 12 month later and after many cost cutting moves, i dont think the ps3 costs 400 to make.

PS3/Sony are just trying to give you fanboys some much needed ammo in this "next gen" war. they dont want you guys running into a battle, your most likely gonna lose, w/o a little something to say ROFLROFLROFL.

Or maybe your just too emotional to see that Sony isnt stupid, and if the price point was going to stay at 900 per console they would have never released it. Sony has cut costs, mostly because of Blu-Ray diode. And what YOU THINK and what a trusted company such as Citigroup thinks are two completely different things.

If you dont understand how it is possible for Sony to do this, then I feel sorry for you. I think its more that your in denial, and your hate for Sony makes you WISH they cant do this. But they have, and regardless of how many times you say "OMG I DONT BELIEVE IT" its true. Deal with it sweetheart.

 

I don't think anyone is saying it STILL costs $900 to make,just that being able to drop the manufacturing costs by more than 50% in just over a year is highly unlikely.

 



Around the Network
misterd on 13 January 2008
Darc Requiem said:
If it cost them $400 to make a 40GB PS3 they are still losing money on each unit sold. With the MSRP being $399.99, retailers probably pay around $380 for each 40GB unit they stock. Thats assumming the $400 cost estimate includes the actual manufacturing and shipping cost. If its only component costs, then the losses would be much steeper. The quarterly report from Sony will give us an indication of what the costs of the 40GB model is.

Maybe it's different for consoles, but my understaning was that about 1/3 of retail price on consumer electronics was markup. If so, stores may be paying no more than $300 for 40g console.



Jandre02 on 13 January 2008

FOR EVERYONE SAYING THEY DONT BELIEVE THIS, HERE IS THE LINK FROM BUSINESS WEEK.

http://www.businessweek.com/globalbiz/content/jan2008/gb2008018_681920.htm?chan=search

Thats the original article, so whether or not you want to believe it, its true like I said. And its not Sony that released this, but Citigroup who is estimating costs. If you dont think its possible, you obviously dont know what your talking about.



Nidan on 13 January 2008
Jandre02 said:
FOR EVERYONE SAYING THEY DONT BELIEVE THIS, HERE IS THE LINK FROM BUSINESS WEEK.

http://www.businessweek.com/globalbiz/content/jan2008/gb2008018_681920.htm?chan=search

Thats the original article, so whether or not you want to believe it, its true like I said. And its not Sony that released this, but Citigroup who is estimating costs. If you dont think its possible, you obviously dont know what your talking about.

 

I think everyone believes the story exists and Citigroup has done an estimation which may be approximate, but its not including the accessories, shipping, packing and distribution cost.

 

Remember that there are a number of margins between the retail price and the manufactures price. Also it doesn't take into account royalties which may be needed to be paid on some of the technology.


 



Predictions JAN 08

2008 PS3-19.5M(actual 19.5) XBOX360-23M(actual 27.5) Wii - 37M(actual 45.8M)

End of 2009 PS3-27 25M XBOX360-30 35M Wii - 48 63M (revised DEC 08)

Price Point
Mid 2008 Wii $250 Xbox360$249 Xbox360(HDD)$299 PS3 $399

Mid 2009 Wii $189 Xbox360$199 Xbox360(HDD)$249 PS3 $339

Mid 2010 Wii $ 149 Xbox360$159 Xbox360(HDD)$199 PS3 $289

rocketpig on 13 January 2008
misterd said:
Darc Requiem said:
If it cost them $400 to make a 40GB PS3 they are still losing money on each unit sold. With the MSRP being $399.99, retailers probably pay around $380 for each 40GB unit they stock. Thats assumming the $400 cost estimate includes the actual manufacturing and shipping cost. If its only component costs, then the losses would be much steeper. The quarterly report from Sony will give us an indication of what the costs of the 40GB model is.

Maybe it's different for consoles, but my understaning was that about 1/3 of retail price on consumer electronics was markup. If so, stores may be paying no more than $300 for 40g console.


Retailers make virtually nothing on hardware. The reason they sell them is promises of revenue through software sales and accessories.

It's one of the reasons why so many retailers try to bundle software with hardware at launch. They want some money in the deal. 




Or check out my new webcomic: http://selfcentent.com/

Around the Network
jphuff on 15 January 2008
Jandre02 said:
weezy said:
End of story Rabidbunny, the PS3 was supposedly a $900 device and 12 month later and after many cost cutting moves, i dont think the ps3 costs 400 to make.

PS3/Sony are just trying to give you fanboys some much needed ammo in this "next gen" war. they dont want you guys running into a battle, your most likely gonna lose, w/o a little something to say ROFLROFLROFL.

Or maybe your just too emotional to see that Sony isnt stupid, and if the price point was going to stay at 900 per console they would have never released it. Sony has cut costs, mostly because of Blu-Ray diode. And what YOU THINK and what a trusted company such as Citigroup thinks are two completely different things.

If you dont understand how it is possible for Sony to do this, then I feel sorry for you. I think its more that your in denial, and your hate for Sony makes you WISH they cant do this. But they have, and regardless of how many times you say "OMG I DONT BELIEVE IT" its true. Deal with it sweetheart. 


 Good grief weezy....WHO is the fanboy here?  You don't understand how an electronics based technology can reduce dramatically in cost in a period of over two years?  And make no mistake, even though the PS3 has been out just over a year, the BD player was over 50% of it's initial cost.  With the way those players have reduced in cost and the general economic and manufacturing priciples involved, it's easy to see that Sony can EASILY be in a much better position today than they were last November.  What's the big deal, anyway?



Slimebeast on 15 January 2008
starcraft said:

misteromar makes an interesting point. Even if the component cost estimate is accurate (and somehow I doubt it), it doesn't appear to take into account assembly and transport, which could equate to another $50 or so. On the other hand, we know that Microsoft is making a profit overall on each unit sold (though whether it is a significant enough margin to remain after their next price drop is doubtful).

Edit: The article says production cost which I assume includes assembly.  That though, in my opinion, makes the $400 figure all the more unrealistic. 


Not that I doubt it, but how do we know the X360s are profitable now? Is it your guesstimate or did you get it from a reliable source?



Bodhesatva on 15 January 2008

http://kotaku.com/344097/ps3s-now-made-for-half-the-price

Okay, here's a brief summary of why I'm so confused by this. In this post, it mentions that Japanese analysts expect them to start making a profit in late 2009.Hirai was "hoping," but definitely not garaunteeing, they could do it sometime by next April, 15 months from now. 

How could Sony be breaking even on production now, but still be losing money for so long? Even though they're making money on every PS3 game sold, every PS2 machine, every PS2 game sold, and every PSP?

I'm not saying this is totally impossible -- I'm just saying something doesn't compute here.



http://i14.photobucket.com/albums/a324/Arkives/Disccopy.jpg%5B/IMG%5D">http://i14.photobucket.com/albums/a324/Arkives/Disccopy.jpg%5B/IMG%5D">

BLOODLINEZ on 15 January 2008

It does not matter because the companion cube is down with Sony. The companion cube will not try to stab you in the back. It wants everybody to sit down with a PS3 and eat cake.



PLAYSTATON NETWORK: BLOODLINEZ

BLOODLINEZ on 15 January 2008

It does not matter because the companion cube is down with Sony. The companion cube will not try to stab you in the back. It wants everybody to sit down with a PS3 and eat cake.



PLAYSTATON NETWORK: BLOODLINEZ