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

Why is it so hard to see ?

BLU-RAY, format, royalties.

Get it trough your head, at their best profits from gaming pale in comparison to what they can make from owning the format of choice.

WTF is wrong with you ? u think they did not go through the numbers them selfs ? that a huge corp like Sony would just out of nowhere make such a dumbass mistake and screw them selfs over so badly ?

Cold harsh truth is Sony was damn near willing to sacrifice their gaming division for a victory in the format war.

While Br is a great benefit to PS3 capability it damn near ruined the PS3. Br was forced upon the PS3 by Sony corp and we all know this. SCE did not want or need BR. Br is responsible for PS3 launch delays and high cost.  Br is the reason 360 got such a huge head start.

They painfully know how much they lost by losing to vhs, they know damn well that profits frrm gaming even at their best are nothing to what they can make from BR.

Its all as simple as looking at the PS3 as something beyond just gaming and SCE.





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RedArmia said:
Why is it so hard to see ?

BLU-RAY, format, royalties.

Get it trough your head, at their best profits from gaming pale in comparison to what they can make from owning the format of choice.

WTF is wrong with you ? u think they did not go through the numbers them selfs ? that a huge corp like Sony would just out of nowhere make such a dumbass mistake and screw them selfs over so badly ?

Cold harsh truth is Sony was damn near willing to sacrifice their gaming division for a victory in the format war.

While Br is a great benefit to PS3 capability it damn near ruined the PS3. Br was forced upon the PS3 by Sony corp and we all know this. SCE did not want or need BR. Br is responsible for PS3 launch delays and high cost.

They painfully know how much they lost by losing to vhs, they know damn well that profits frrm gaming even at their best are nothing to what they can make from BR.

Its all as simple as looking at the PS3 as something beyond just gaming and SCE.





So they sacrificed their gaming dominance just for Blu-Ray... Now do you have any numbers of how much money they stand to make from Blu-Ray? Any data on how the profits are divided among the Blu-Ray association members?

I've been looking for that data for a long time, yet no one could ever show me anything even remotely indicative of that. 

If you have that data, I'll be thankful and I'll admit you may be right about those claims. Otherwise, I'll keep being skeptical that that's the strategy as they planned it out.

 



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

NJ5 said:

I know that this is pretty obvious for some of you, but I think it deserves to be discussed in its own thread:


In some ways, 2008 is proving to be a big year for the HD consoles... Third parties are giving them a lot of support, launching big games which are expected to be the climax of those consoles' success. The biggest such games for 2008 are obviously GTA4 and MGS4.

Given this, what do Sony and Microsoft do regarding those games?

- Microsoft does huge price cuts in Europe before GTA4 launches, positioning their console near Wii's price, which is obviously a much cheaper console to manufacture (thanks for that BTW, it enabled me to get their console for GTA4 and a few other interesting games). It's still unclear whether they'll do the same thing for USA, but it wouldn't surprise me if they did.

- Microsoft spends $50 million on downloadable content for GTA4, much of which they'll probably never gain back.

- Sony bundles MGS4 and GTA4 with zero added cost for the consumer vs the console's price. This negates any gain from royalties on those two games. They'll be losing money in two ways when someone buys one of those bundles:

  • Manufacturing cost vs retail price. They have gone on the record saying that they are still losing money on hardware, and that they only expect to start breaking even towards the end of the fiscal year.
  • The games themselves which they have to buy from Konami/Take 2, instead of taking royalties as it would be expected.

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.

 


 they get the games cheaper then the retail cost though.



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Main point of the OP "I'm a narrow minded wii fanboy and this is why i think 360 and PS3 are bad, pay attention to me." No facts, figures sources, a steaming pile of assumptions with little or no actual basis good job, you could have at least added some sources to at least make some sort of decent attempt.



Auron said:
Main point of the OP "I'm a narrow minded wii fanboy and this is why i think 360 and PS3 are bad, pay attention to me." No facts, figures sources, a steaming pile of assumptions with little or no actual basis good job, you could have at least added some sources to at least make some sort of decent attempt.

What do you want sources for? The $50 million spent/loaned on DLC? I believe you (as most) have seen that already. That Sony's still losing money on hardware? It's already a few posts above yours. What else do you want sources for?

Maybe it would be better if you contributed with something relevant to this thread, but as I've seen your posting habits I'm not counting on it.

 



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

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NJ5,

1/ are u sur Sony lost ALL their PS/PS2 money on the PS3 ???

they get +5Billions from PS+PS2

I thought they lost -3Billions from PS3

They are in the red, but they still dont have lost everything they get during the PS/PS2 area.

2/ Actually, I doubt making some bundle with GTA4 or MGS4 can be compared to a 50$ invest in 2 add-on.

I m NOT going to say Sony has not invested (lost...) a lot of money in the PS3 but bundling games kill maybe 10% of the sales AT MAX.

3/ Overall, I agree Sony and MS are directly fighting each other and putting all their effort on the hardcore market. But remember the Xbox360 is old when the PS3 is still new. The problem is not that the PS3 is targetting hardcore (MGS) and slowly targetting core gamer (GT5). The problem is MS that fail to make their transition from hardcore to casual because of the Wii

Again, MS is competing versus 2 guys : Sony and Ninty.

(Here comes my Sandwitch Theory)

MS played well at the beginning versus Sony (and Sony played very bad)
but now Sony is awaking.

The big problem is in fact the Wii that dont allow MS to use their cheaper entry price as they wanted to use it.
Ninty is tarhetting casual as the Xbox360 arcade.
But Arcade Xbox360 <<<<<<< Wii and that is the BIG problem.

Since 1 year, Ninty is killing MS more than Sony.



Time to Work !

please excuse me sir, did you say that the losses that they've taken thus far will be hard to recoup?

Umm say.... 10million console at 200$ loss= 2 billion dollars lost.

At 1.5-2 games per console, they make another 50 dollars per console (not sure the actual numbers for production vs margin) so far 11.5 million consoles = 575 million from games.

development of BR, not an issue, the BR association is headed by Sony, by it is separate. Soooo, they only have another 100 million games to sell to break even, that's not bad... considering GT5 will be out later on, MGS4, GTAIV, LittleBigPlanet, ff13, killzone, and lots of others will be out soon.

End of year estimates are to sell 18 million units total. Most systems so far were bought so that they will be able to buy at least two of these games. Plus, i believe that probably 30-40 percent of people who own a ps3 own it for BR only. One of these games must appeal to them. I estimate that attach rate will go up a game this year.  I feel that by the end of the year it will be 3 games per system sold, or more which is more than halfway to getting losses back.

These are all very rough estimates so the numbers might be off by a little or a lot. All i know is that ps3 is not doing as bad as everyone thinks it is. 

 



libellule said:
NJ5,

1/ are u sur Sony lost ALL their PS/PS2 money on the PS3 ???

they get +5Billions from PS+PS2

I thought they lost -3Billions from PS3

They are in the red, but they still dont have lost everything they get during the PS/PS2 area.

2/ Actually, I doubt making some bundle with GTA4 or MGS4 can be compared to a 50$ invest in 2 add-on.

I m going to say Sony has not invested (lost...) a lot of money in the PS3 but bundling games kill maybe 10% of the sales AT MAX.

3/ Overall, I agree Sony and MS are directly fighting each other and putting all their effort on the hardcore market. But remember the Xbox360 is old when the PS3 is still new. The problem is not that the PS3 is targetting hardcore (MGS) and slowly targetting core gamer (GT5). The problem is MS that fail to make their transition from hardcore to casual because of the Wii

Again, MS is competing versus 2 guys : Sony and Ninty.

(Here comes my Sandwitch Theory)

MS played well at the beginning versus Sony (and Sony played very bad)
but now Sony is awaking.

The big problem is in fact the Wii that dont allow MS to use their cheaper entry price as they wanted to use it.
Ninty is tarhetting casual as the Xbox360 arcade.
But Arcade Xbox360 <<<<<<< Wii and that is the BIG problem.

Since 1 year, Ninty is killing MS more than Sony.

1- They didn't make 5 billions off the PS2. You've seen this table before (numbers can be checked on their fiscal reports):

2- Maybe not directly comparable, I'm not saying Sony and Microsoft are in the exact same situation.

 



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

@theprof00
""Plus, i believe that probably 30-40 percent of people who own a ps3 own it for BR only.""

==> U lost me here.

Just check some multiplateform games sales and u will attach rate is FAR from being ridiculous.



Time to Work !

NJ5,

YEAH YEAH, I know it

but it doesn't count the total PS sales, does it ?

whatever, let's say they made 3 billions (at very best) on the PS/PS2, so it is obvious they have lost everything.



Time to Work !