Forums - Sales Discussion - Sony may have been "overly ambitious", warns Pachter

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Sony may have been "overly ambitious", warns Pachter

Ellie Gibson 14:06 (BST) 18/05/2007

"Most consumers are balking at the price of PS3"

Wedbush Morgan analyst Michael Pachter has warned that Sony will have to make difficult decisions regarding the PS3's price point if sales of the console are to improve.

Speaking to GamesIndustry.biz Pachter said, "I think Sony's strategy of including a Blu-ray drive and a microprocessor that will stand up to ten more years of technological advances may have been overly ambitious - given that they have so far asked consumers to pay for the high definition movie option and to help finance development of the Cell."

Pachter's comments came after NPD released US sales figures for April, revealing that although PS2 and PSP are selling well the Game Boy Advance is proving more popular than PlayStation 3.

"It's not good news for Sony that most consumers are balking at paying the prices asked for PS3s," Pachter said.

"Sony has to make a choice between subsidising the Blu-ray and cell costs, or waiting until their production costs drop. It's more likely than not that they will break with tradition and cut prices below manufacturing costs."

So far Sony has offered no hint as to when a price cut for PlayStation 3 might be announced. Pachter offered, "My guess is that this will happen at E3 in July, but one never knows with Sony."



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Meh...it's been said before. I don't know if it's ideal for Sony to make a price cut this summer though...they'll be losing so much money...money they could make when their big hits come out after the holidays. But I suppose if they don't cut the price this summer, they may lose too many potential buyers.



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"Most consumers are balking at the price of PS3", wow talk about working hard for your money. Wasn't this the guy who last month predicted Sony would the console race? I wonder if he has any other timely analysis, perhaps that Wii Sports is a hit with casuals and expanding the market. Or maybe that Nintendo will earn a ton of profit due to its business strategy. I'd have a lot more respect for these "analysts" if they were trying to get game developers to realize consumers won't pay $600 for a video game system a year ago (something I said at the time) instead of predicting a continuation of Sony's reign of the top.



Stringer's already promised a 5% profit margin for '07. A big price cut on the PS3 will make that goal very difficult. If he doesn't deliver on on that promise, shareholders will be very unhappy.



Pachter needs to shut up already. All the guy does is jump from one opinion to another so that he can always claim to be right down the road.




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BenKenobi88 said:
Meh...it's been said before. I don't know if it's ideal for Sony to make a price cut this summer though...they'll be losing so much money...money they could make when their big hits come out after the holidays. But I suppose if they don't cut the price this summer, they may lose too many potential buyers.

And as we saw from Gamecube pricecuts aren't necessarily saviors.

Most people won't even smell what the PS3 is cookin' until it gets down to the $300 range.

A $100 for each digit that makes up the 3 in the PS3.

PS3 is on Rock Boulevard and Hardplace Drive stranded with its thumb out looking to hitch.

Oh & agreed, rocketpig, about Pachter. Who IS this A-hole running his mouth all over gaming events? We're better analysts than these clowns! 

John Lucas



Words from the Official VGChartz Idiot

WE ARE THE NATION...OF DOMINATION!

 

The first price drop for the PS3 would have to be at least 200$, because a price of 500$ only led to a discontinued 20GB SKU.

However, as soon as Sony drops the price Microsoft will lower their price, so to be competitive and stay in the race for #2 Sony would need to drop the price by 300$ before the end of this year. That won't happen. 

Sony has priced themselves into a lose-lose situation and all they can do for the rest of this generation is damage control. They will stay in #3 for this entire gen. 



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Gamers Club

Gee, thanks Pachter!!! Welcome to a year ago!!! Sony needs to cut the price by $400 right now. A traditional console, which is not offering a new experience, likely has less value with consumers than something like Wii. So in order to get back into the competition, Sony needs to undercut Wii's price. A $200 pricecut is only going to get them to 360's level of pathetic. And of course they need to be outselling 360 in order to beat it in total sales. So at a bare minimum, to at least compete for second place, they need to cut the price to $300. Of course Pachter won't say that, because he's only just waking from his dream world where Sony will magically take 40%+ of the Japanese market, and doesn't know just how f***ed Sony are.



"[Our former customers] are unable to find software which they WANT to play."
"The way to solve this problem lies in how to communicate what kind of games [they CAN play]."

Satoru Iwata, Nintendo President. Only slightly paraphrased.

A price cut to $200 is sheer insanity. Definitely could use a price cut to $400, though, not that the theory is anything new.



Imagine for a moment that right now, at this instant, the PS3 is priced the exact same as the 360 Elite.

The game situation is the same.

Who would sell more?

The 360.

Why? Not JUST the game selection, but word of mouth. Everytime I go into a game store and hear someone ask about the PS3, the store employees are bashing it left and right. It's no wonder it's doing bad at retail. I hear this all the time. "For 200 bucks less, you get better games that look just as good on the 360."

And don't bother asking for a Wii. They usually laugh and tell you the next time a shipment comes in and to show up before the store opens.

A price cut won't do the whole job this time.