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

Forums - Sales - Microsoft and Sony are destroying their (and each other's) gaming business

DMeisterJ on 07 April 2008
NJ5 said:
DMeisterJ said:
The MS thing you have a point with, since they are paying out money for price drops, and for the content, but you lost me with Sony.

You act as if Metal Gear Solid 4 and Gran Turismo 5: Prologue aren't bought on their own.

GT5: P has already sold 250k in Japan, w/out being bundled, and I guess if every copy of GT5: P sold in Others last week was bundled you'd make sense, but most, if not all of them weren't bundled, looking at sales. And GT5: P isn't even bundled in the US, so US sales will all help.

And again, with MGS4, Not every game being bought will be the bundle, some won't be bundled. You act as if the eleven million PS3 owners will not buy either of these games, when it's been said that MGS4 "isn't a system seller", and the same has been said about GT5: P. So if it isn't a system seller, then the games must be selling to the people who already own the system.


You're right that I didn't explicitly discuss the games being bought on their own. However, if you look at the othet stuff happening behind the scenes, it's not hard to see them eliminating most or all of the profit they could get from the royalties on those games: Microsoft's $50 million for Take 2, and Sony's likely financing of MGS4 as an exclusive (although this is not for sure), and their aggressive bundling of both games together with hardware that they weren't making a profit on in the first place.

I just don't see Microsoft and Sony making much (if any) money from those games. Given that the loss-leading business model is about losing money on hardware to make it back on software, I think they may be getting a bit late in the "making it back" part.

You can of course disagree and discuss, which is what this forum and this thread exists for.

 


Again.  Under the assumption that the games sold w/out bundles = Games sold w/bundles, then you have a point, but as we can see in Japan, the game (GT5: P) sold 250k w/out bundling, so the game sells minus bundling, and we'll never know how much systems sold were bundled with games and not.

It's too much grey area to have a definite stance.  



Around the Network
SlorgNet on 07 April 2008

Sony is doing fine. Microsoft has destroyed itself. They skimped on testing and build quality, made it impossible to add hard drives to the 360, and ignored next-gen DVD. Worse, they lied through their teeth about every single one of these problems. RRoD? "Stuff breaks". Tiny hard drive? "Customers don't need all that space". No next-gen DVD? "In the future, everyone will download their movies."

Microsoft will be lucky to retain 15% of market share for this generation.



CaptainPrefrences on 07 April 2008

so true slorgnet



akuma587 on 07 April 2008

I definitely agree that Sony and MS are poisoning each other's wells while Nintendo snuck up behind them to capture the casual market. Without real third-party support, the Wii might never be the savior people are making it out to be, however.



We had two bags of grass, seventy-five pellets of mescaline, five sheets of high-powered blotter acid, a salt shaker half full of cocaine, a whole galaxy of multi-colored uppers, downers, screamers, laughers…Also a quart of tequila, a quart of rum, a case of beer, a pint of raw ether and two dozen amyls.  The only thing that really worried me was the ether.  There is nothing in the world more helpless and irresponsible and depraved than a man in the depths of an ether binge. –Raoul Duke

It is hard to shed anything but crocodile tears over White House speechwriter Patrick Buchanan's tragic analysis of the Nixon debacle. "It's like Sisyphus," he said. "We rolled the rock all the way up the mountain...and it rolled right back down on us...."  Neither Sisyphus nor the commander of the Light Brigade nor Pat Buchanan had the time or any real inclination to question what they were doing...a martyr, to the bitter end, to a "flawed" cause and a narrow, atavistic concept of conservative politics that has done more damage to itself and the country in less than six years than its liberal enemies could have done in two or three decades. -Hunter S. Thompson

Bitmap Frogs on 07 April 2008

Competition is good my friend!

Right now, the 360 retails for 200€ and sony is gonna bundle just released AAA games with no extra price on top of the insane drop to 400€. Just a year ago the core was 350€ and the ps3 599€. Let the shareholders worry about the numbers and just enjoy the games.





Current-gen game collection uploaded on the profile, full of win and good games; also most of my PC games. Lucasfilm Games/LucasArts 1982-2008 (Requiescat In Pace).

Around the Network
outlawauron on 07 April 2008

@ neos

I don't see how you can disagree. A one console market would be absolutely horrific.

And I thought it was only a rumor that they were bundling GTA4.



"We'll toss the dice however they fall,
And snuggle the girls be they short or tall,
Then follow young Mat whenever he calls,
To dance with Jak o' the Shadows."

Check out MyAnimeList and my Game Collection. Owner of the 5 millionth post.

RedArmia on 07 April 2008

NJ5 said:

 

When I put that together with the losses that they have sustained before this point (especially Sony in terms of the current-gen), I get this picture:

This is a like battle between irate giants, who keep pounding each other (and themselves) to the ground at every step, even when they're getting near the climax of their product's life.

They're not just competing, they're competing so fiercely that the only winners in the business seem to be the consumers and a few lucky third parties.

 



Its hilarious how many of you are arrogant enought to think you know more then these corps, as if your a analysts not that they are of any value making this even more hilarious. 

You don't even even understand the basics of it.

Sony ate the PS3 losses for BR and time has show them to have done the right thing, somehting a hell of alot more valueble the gaming was to them even at PS2s height of market dominance.

MS are losing ground fast in softwre, they are desperatly looking for a market that will be a big part of their future business.  They are going for broke trying to gain a significance marlet share, to bad for them their comp is so damn good.

In reality this is a battle where Sony took a beating but survivded and now is kicking MS ass.  Its only matter of time beofre MS falls and Sony eats up their marlet share.

Given sales and the price of PS3 360 hardware, its not hard to see that MS actions now have little affect on Sony.  



NJ5 on 07 April 2008
RedArmia said:

NJ5 said:

 

When I put that together with the losses that they have sustained before this point (especially Sony in terms of the current-gen), I get this picture:

This is a like battle between irate giants, who keep pounding each other (and themselves) to the ground at every step, even when they're getting near the climax of their product's life.

They're not just competing, they're competing so fiercely that the only winners in the business seem to be the consumers and a few lucky third parties.

 



Its hilarious how many of you are arrogant enought to think you know more then these corps, as if your a analysts not that they are of any value making this even more hilarious.

You don't even even understand the basics of it.

Sony ate the PS3 losses for BR and time has show them to have done the right thing, somehting a hell of alot more valueble the gaming was to them even at PS2s height of market dominance.

MS are losing ground fast in softwre, they are desperatly looking for a market that will be a big part of their future business. They are going for broke trying to gain a significance marlet share, to bad for them their comp is so damn good.

In reality this is a battle where Sony took a beating but survivded and now is kicking MS ass. Its only matter of time beofre MS falls and Sony eats up their marlet share.

Given sales and the price of PS3 360 hardware, its not hard to see that MS actions now have little affect on Sony.


If you know as much as you're trying to appear to, tell me how Sony is going to make back the losses they had with the PS3 (which are bigger than the profits they did during the PS2 period... there's financial data around to prove that, in the form of a table made from fiscal reports which has been appearing everywhere in this and other forums lately). That means that even a PS2-like success wouldn't be enough to get the PS3 back from the red.

Sony obviously wasn't expecting to lower their prices so fast, and that's taking its toll in their finances.

I don't think I'm an analyst, but I do think that I'm raising a valid point for debate. Replying with "they're corporations, they know what they're doing" doesn't cut it. Countless corporations have failed.

 



My Mario Kart Wii friend code: 2707-1866-0957

theprof00 on 07 April 2008

Just for future reference poster,

1) How much of any of the facts do you know are true.

2) Realize that opinion of yourself is just a very small part of the equation

3) Try to think about reasons why even factual evidence may be false.

 

XBox is shooting itself in the foot because of their payment for extra material. That material matters not to buyers of consoles, or even multiple console owners. The decision to buy one format game over the other is preference, and most gamers do not download additional content, or infact use it as a reinforcement to buy a game. I didn't buy COD4 because I wanted to buy the map packs further down the road. In fact I haven't even thought about it until i read about it here, and 360 got the pack first (Darn I should've bought it for 360).

Also, how much do you know for absolute sure, not what people have said, but actual figures, the concrete evidence and facts stating the actual loss per part? I've been under the assumption that ps3 hasn't dropped below 400 because of the agreement between the blu ray association not to drop below that mark. A lot of companies are involved in BR, and none of them want to see Sony control it. They want equal chances to compete, and being altogether founders of the format, they have a strong say. See more in the future about ps3 staying at 400$ and simply adding more games/more controllers/smaller casing/smaller components/better parts and cooling/ quieter. Yet still holding to 400$... I think this will be the way things go until BR stand alone players make their way down past the 400$ mark consistently. 

UPON REREAD:

 What numbers and who are you quoting when you say they are still losing money. I've read about 3 sources that say so, and 100 that say they already have started making profit. BTW: fiscal year just ended. The reports I'VE been reading have been saying that they profitted since January-February, which is a month away from the fiscal year-end, so...



NJ5 on 07 April 2008
theprof00 said:

Also, how much do you know for absolute sure, not what people have said, but actual figures, the concrete evidence and facts stating the actual loss per part?


It's as true as we can possibly know it... It's part of Sony's execs declarations at their last financial report and conference. It's not just PR, they're legally obligated to provide correct information at those events. There's a transcript here:

http://seekingalpha.com/article/62529-sony-corp-f3q07-9qtr-end-12-31-07-earnings-call-transcript?page=-1

If you search for the phrase "catch up" in that page, you'll see the part where they make it very clear that they're only hoping to break even on each hardware unit towards the end of the current fiscal year.

theprof00 said:

UPON REREAD:

What numbers and who are you quoting when you say they are still losing money. I've read about 3 sources that say so, and 100 that say they already have started making profit. BTW: fiscal year just ended. The reports I'VE been reading have been saying that they profitted since January-February, which is a month away from the fiscal year-end, so...


What you're seeing is that their gaming division made a profit, not that PS3 hardware itself did (that would contradict the declarations I pointed to in the first part of this post).

 



My Mario Kart Wii friend code: 2707-1866-0957