So how is the money made?

By hoping that the customers find other things while going through the market and all it's sections. Preferably PCs/notebooks, TVs or washing machines and other stuff. Oh and by horribly overpricing any kind of accessory like cables.

But it doesn't work very well lol. Pretty much ever store is posting huge losses and the one he's working in lost about 50k € last year and was among the most profitable stores in Germany.

well, after the adjustments i noticed that the PS3 sold 1 million units more than the Xbox360 since the start of 2012 worldwide which is impressive to say the least:)

^^^
i think Japan not giving a shit about Msoft has a lot to do with that...

the Xbox360 is in dying need of a price cut before this holiday season to give it some life until its successor arrive next year since microsoft can easily afford one. also it won't hurt to cut the PlayStation 3's price by 50$ just to keep the competition active for one more holiday;)

I don't have the figures for Europe, but the most interesting thing about the recent data is that you can no longer argue Wii users are buying other consoles in the US. The console figures in the US for May were the lowest since May 2000 (by NPD), and comparable to 1997 / 1998, during the height of the N64 / PS1 days when selling 350,000-400,000 consoles in the US market was considered amazing.

This has been true in other months as well, but less dramatically.

May 2012 - 355,000 consoles sold in the US - lowest May figure since 200,000 consoles sold in May 2000.

April 2012 - 500,000 consoles sold in the US - lowest April since April 2002 (421,000 consoles sold in April 2002)

March 2012 - 888,000 consoles sold in the US - lowest March since March 2006 (although March 2007 was 890,000)

February 2012 - 1.02m consoles sold in the US - lowest since February 2007 (1.01m in Feb 2007)

January 2012 - 620,000 consoles sold in the US - lowest since January 2000 (537,000 in January 2000, although 630,000 in January 2002 was close to 2012)

January - May US Consoles sold

2012: 3.38m             2011: 4.23m

2010: 5.16m             2009: 5.63m

2008: 6.22m             2007: 4.80m

2006: 3.01m             2005: 3.54m

2004: 3.43m             2003: 3.57m

2002: 3.50m             2001: 3.60m

2000: 2.20m             1999:  2.57m

1998: 2.85m             1997:  2.11m

Basically, figures have been abysmal in January, April, and May - and bad from January - May. We're heading for a 2004-2005 like year in the USA...which is not good.

December was also weak too for consoles in the US -

Dec 2011 was just under December 2006 and well under December 2007-December 2010, and weaker than peak PS2 era Decembers a decade, and Dec 1999...

While I know that both consoles are handhelds are selling "weak" right now, I wonder why people are comparing the numbers to 2008-2010? Obviously that pace is gone, we're way past a normal gen cycle already...

@Troll_Whisperer

My point isn't that Sony would necessarily lose money by selling the Vita. That isn't really the problem. The problem is can retailers make money by selling the Vita. Retailers have to cover overhead costs. They need to pay utilities, taxes, employees, upkeep, and their investors. That means that every square meter of retail space must generate a certain amount of money. Retailers cannot stay in business by just selling. They need to sell enough to cover their costs. Otherwise they go out of business.

Lets say that a retailer gives the Vita, and its associated products thirty six square feet of retail space, and since it is a new product that space is probably their prime real estate. The place on their shelves that sell the most, and the place where their expectations are highest. That retailer may need to clear five hundred dollars in sales weekly in that space to break even. However the Vita isn't doing that kind of business, and is only averaging sales of half of that. Now the retailer has a problem to deal with. Those sales aren't wants at all. It needs those sales to cover all of those costs.

No retailer is going to want to lose money, or tolerate losing money if that can be avoided. So that retailer will in fact do the most logical thing. That retailer will decrease the space they are giving the product to a point where it thinks the product will meet the sales target. The newly free space will be given to another product which might do better with that space. So now the Vita has half the space to sell out of on the sales floor. You might at this point be saying hurray for the Vita. It is after all going to be able to meet the retailers expectations.

Hold that thought for a minute. The Vita was only selling half of what it needed to in the space it started out with. What happens if that trend continues into the smaller space. What if now having half the space means it will have half the sales that it had before. This shouldn't come to a shock to you, but when a product gets less shelf space it also gets less attention, and it doesn't look at attractive to consumers. So if the trend continues the retailer may take the next logical step.

The retailer decides to shuffle the order, and give the prime real estate to a product line that is meeting or even beating their expectations. Now the Vita is somewhere near the back of the game section. Where the retailer has very low expectations. Now you might be saying well it is in a section where it only has to sell one hundred bucks per week to break even for the retailer. The problem obviously being that the Vita is now somewhere that most of the customers at that retailer aren't likely to go looking for devices or games.

Worse then that other products even the one just ahead of the Vita in the lineup might start muscling the Vita for what little space it now has. Not only does it not have the good shelf space anymore, but it may even lose some of the eighteen square feet of space it has left. It might get pushed down to eight square feet, followed by four square feet, and then well retailers don't carry products that don't have a market anymore.

I know your probably saying to yourself pure melodrama, and to that not trying to be a dick mind you. That is just plain bullshit. This is the exact way every platform finds its way out of the market place. Whether it lasts for many years, or just a few months. This is how all of the current generation of consoles are going to vanish from those same shelves. Their sales are going to slow down, and retailers are going to cut their space, move them to the back, put them on clearance, and be done with them.

The problem for the Vita isn't just that the sales are low. The platform does have a grace period, but it doesn't by virtue of being have a indefinite one. The platform isn't going to get the better part of a year to just slink its way forward. Hardware sales are supposed to make up for software sales upfront. Without strong hardware sales it is obvious that software sales aren't doing much better if at all. So based on these sales figures.

The Vita is not selling at all in some locations, and it obviously follows that the software isn't selling either. There are more retailers in these regions than units being sold. Sure Sony isn't losing money, but I guarantee you that the middle man is the one taking it in the wallet. The product doesn't even have enough critical mass to maintain any prolonged demand. It isn't as if there are fifteen million units out there, and fifteen million users that will need games for it for years to come.

I only have my personal knowledge with contracts made with Sony and Microsoft through two retailers I worked at. I worked at a local store whose contracts were far less favorable than most stores. How much they made varied heavily (60% on a shovelware title, but they only brought home $2 on each copy of Madden on Ps3 and 360), but the hardware margins were very similar to when I worked at Circuit City.

Circuit City was a big box retailer, and they still couldn't get anything more than $5 off any piece of hardware at full MSRP. That said, they still didn't have as much power as Wal Mart or GameStop, so the prices may vary once again.